December 14, 2020 by eklose
The peru-South Korea Free Trade Agreement came into force in 2011. South Korea is the third Asian country to sign a free trade agreement with Peru. This free trade agreement has a 10-year validity period and its main objective is trade: to make trade tax-free in order to stimulate trade in goods and services. This agreement gave Peru access to a huge market for fresh agricultural products. The peru-South Korea Free Trade Agreement was signed on March 21, 2011 in Seoul, Korea, and came into force on August 1, 2011. In line with Peru`s strategy to strengthen trade with Asia, South Korea was the third Asian country with which Peru signed a free trade agreement. Among the other features of the Peru-Korea Free Trade Agreement, a ten-year period has been set, as is the case with a trade agreement, to remove tariffs on products that the two countries share. However, there may be other measures that can be applied in the form of import duties to certain agricultural products defined in the agreement. In addition, these trade agreements are a valuable tool for attracting foreign direct investment and increasing business productivity and encouraging technology transfer by reducing the cost of imports of investment goods and quality intermediate consumption.
Trade agreements encourage the convergence of international standards, which has allowed more Peruvian companies to improve their management and logistics practices. Nearly 95% of Peru`s exports are covered by the free trade agreements currently in force. This allows Peruvian products, subject to the rules of origin of any trade agreement, to enter 53 countries under preferential conditions, including Canada, Chile, China, European Union Member States, Japan, Singapore, South Korea, Thailand and the United States, among others. In addition, agreements are still in place with the Pacific Alliance (Colombia, Chile, Mexico) and ongoing negotiations with the Trans-Pacific Partnership (Brunei Darussalam, Chile, New Zealand, Singapore, Australia, the United States, Malaysia, Vietnam, Canada, Mexico and Japan) – “Image by EY.” The agreement provides tariff concessions for processed agricultural products (Chapter 3 and Appendix III). Tariff concessions for agricultural commodities are covered by bilateral agricultural agreements, which are part of the instruments for creating a free trade area between the contracting parties. We will now give an overview of the current trade agreements and organizations in which Peru is participating today. The most recent is the Australia-Peru Free Trade Agreement, which has opened up even more opportunities for the country. The latest information on this new agreement can be found in the Biz Latin Hub.
We will look at the largest trade agreement, the WTO (World Trade Organization), and then look at the small unilateral trade agreements that Peru has. Peru was allowed to participate in this process on 10 February 2009. Since then, 18 rounds of negotiations have taken place between March 2010 and December 2013 to discuss issues related to regional integration, legislative coherence, economic development, SME access to markets, competitiveness and transparency, in addition to commitments to liberalise trade in goods and services that correspond to the latest generation of free trade agreements. It is the largest trade forum in the world, where trade rules are discussed in almost every country in the world. Peru has been a member of the WTO since its inception in 1995 and all trade agreements with the WTO have been ratified by national legislation. Peru`s development strategy is based on an economy that is open to the world, competitive in its export offer. It was a successful strategy that enabled the country to consolidate its foreign trade with goods and services as an instrument of economic development and poverty reduction.