Minister for Trade Yeo Han-koo (right) and his British counterpart Chris Bryant on Dec. 15 shake hands at the signing ceremony for negotiations on improving their bilateral free trade agreement in London. (Ministry of Trade, Industry and Resources)

By Lee Dasom

Two years of negotiations have produced a breakthrough to improve the country's free trade agreement (FTA) with the U.K.

The Ministry of Trade, Industry and Resources on Dec. 16 said Minister for Trade Yeo Han-koo and his British counterpart Chris Bryant concluded negotiations on improvement of their FTA and signed a joint declaration.

The declaration said both sides relaxed the once stringent rules of origin standards applied to Korea's main exports, allowing Korean companies to more easily receive preferential tariffs under the deal.

Korean cars previously needed to generate at least 55% of their added value in either Korea or the U.K. to qualify for tariff-free access, but this was slashed to 25%.

The country of origin standards for leading exports such as Korean beauty and food were also eased, creating opportunities for their expanded sale in the U.K.

The visa system was also improved. Korean engineers and machinery and equipment maintenance and repair specialists can enter and temporarily stay in the U.K. in the early stages of plant construction for Korean companies operating there.

On the public procurement market, the British markets for high-speed rail and online gaming, two sectors where Korean companies are highly competitive, will be opened.

Given the changing trade environment, both sides adopted new trade norms by setting digital trade rules and forming a comprehensive cooperative system in areas like supply chains and innovation.

Minister Yeo said, "The conclusion of negotiations to improve the Korea-U.K. FTA is an opportunity to solidify the free market order in a trade environment of rising uncertainty due to growing protectionism and raise economic cooperation with the U.K., a major European partner."

dlektha0319@korea.kr