South Korea Reaches Digital Agreement with Singapore... Also Requests Support for CPTPP Membership

Our Country's First Digital Trade Agreement... A Bridgehead for ASEAN Market Entry

[Sejong=Asia Economy Reporter Kwon Haeyoung] The Digital Partnership Agreement (DPA) between Korea and Singapore has been finalized.

Yeo Hangoo, Director-General for Trade Negotiations at the Ministry of Trade, Industry and Energy, and Tan See Leng, Second Minister for Trade and Industry of Singapore, declared the conclusion of the Korea-Singapore Digital Partnership Agreement (KSDPA) in Singapore on the 15th and signed a joint statement. Korea’s first digital trade agreement, the Korea-Singapore DPA, was concluded after one year and six months since the negotiation commencement was announced in June last year.

The digital trade agreement is a trade norm for cross-border trade conducted electronically, such as via the internet. Its main contents include facilitating e-commerce, activating digital business, tariff-free and non-discriminatory treatment of digital products, consumer protection, and cybersecurity.

With the spread of digital transformation and contactless economy due to COVID-19, discussions on digital trade norms are actively progressing, especially in the Asia-Pacific region. Not only has the first plurilateral digital trade agreement, the Singapore-New Zealand-Chile Digital Economy Partnership Agreement (DEPA), been launched, but digital trade is also cited as a core area in the United States’ Indo-Pacific Economic Framework initiative.

An official from the Ministry of Trade, Industry and Energy stated, "The Korea-Singapore DPA will strengthen bilateral digital trade cooperation, including in new digital technology fields such as artificial intelligence (AI) and fintech."

Singapore is Korea’s 11th largest trading partner, and with the conclusion of the DPA in addition to the bilateral Free Trade Agreement (FTA), an environment conducive to more active digital trade has been created. Furthermore, digital trade cooperation with New Southern countries is expected to expand.

Additionally, through Singapore’s largest ASEAN e-commerce platforms such as Lazada and Shopee, exports of Korean products like K-Food and K-Beauty to ASEAN are expected to increase. Exports of digital products and services based on Hallyu content such as K-dramas and K-movies are also expected to gain further momentum. In particular, the use of e-commerce platforms and the digitization of trade processes will reduce transaction costs, making it easier for small and startup companies to participate in trade, and expanding opportunities to enter the ASEAN market using Singapore as a foothold, according to the government’s explanation.

Moreover, the Korea-Singapore DPA is expected to serve as a stepping stone for Korea to play a leading role in establishing digital trade norms in the Asia-Pacific region and on the global stage. Also, as Singapore takes a leading role in concluding digital trade agreements based on its high digital competitiveness, the ongoing DEPA negotiations, which Korea is currently seeking to join, are expected to accelerate.

Director-General Yeo said, "I hope this will be an opportunity to strengthen cooperation with Singapore, a key partner in the Korean government’s New Southern Policy, in the digital new industry sector and to create new export momentum through digital methods in the ASEAN market."

Meanwhile, Director-General Yeo also met with Gan Kim Yong, Minister for Trade and Industry of Singapore, on the same day to discuss ways to strengthen trade cooperation, including the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). He explained that Korea will begin social discussions such as public opinion gathering to actively pursue CPTPP membership and requested Singapore, the CPTPP chair country next year, to actively support Korea’s efforts to join the CPTPP.

This content was produced with the assistance of AI translation services.