Will the UK's Path to '탈 EU' Become an Opportunity for Our Export Industry?

FTA Improvement Negotiations Between Korea and UK Planned This Year
Need to Expand and Strengthen Supply Chains Amid UK’s Brexit
Acceleration of Brexit Expected Following CPTPP Accession

The government announced that ahead of this year's push to improve the Korea-United Kingdom Free Trade Agreement (FTA), it will "do its utmost to enable Korean companies to enter the UK market more extensively amid the UK's? (?) European Union (EU) transition."

On the 27th, the Ministry of Trade, Industry and Energy held a 'Major Exporters to the UK Meeting' with UK-exporting companies, related associations, and affiliated organizations, conveying this message. This meeting was organized to discuss strategies for Korean companies to secure a foothold in the UK market amid the reorganization of the UK's supply chain following Brexit (the UK's withdrawal from the European Union). According to the Korea-UK FTA agreement, which came into effect in 2021, negotiations for improvements must begin within two years of its enforcement.

According to the Ministry, the UK's trade supply chain has begun to?EU following Brexit. While the UK's imports from the EU are decreasing, imports from non-EU countries such as China and India are on the rise. From 2018 to 2021, the UK's imports from the EU decreased by an average of 3.1% annually, whereas imports from non-EU countries increased by 4.6% annually during the same period. In particular, major items exported and imported by the UK, such as automobiles, auto parts, and wireless communication devices, have seen decreases in both exports to and imports from the EU, indicating ongoing supply chain substitution, according to the Ministry.

Potential for Increased UK Eco-Friendly Vehicle Exports... Strengthening Supply Chains Essential

At the meeting, participants agreed on the need to expand and strengthen supply chains for major Korean exports to the UK, including automobiles and auto parts, where?EU trends are clearly progressing, as well as chemical products and electrical equipment. Especially, with the UK banning the sale of new internal combustion engine vehicles after 2030, the export potential for eco-friendly vehicles such as electric and hybrid cars is significant, making supply chain strengthening essential.

Looking at the trends in Korea's eco-friendly vehicle exports to the UK, electric vehicle exports increased from 1,461 units in 2018 to 31,262 units last year, while hybrid vehicle exports rose from 13,309 units in 2018 to 32,558 units last year. Accordingly, companies expressed the opinion that it is important to quickly resolve difficulties faced by the industry during the export process and to utilize and improve the supply chains established under the Korea-UK FTA's rules of origin in a manner favorable to Korean industries.

The UK's?EU process is expected to accelerate following its recent accession to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), a free trade agreement among Asia-Pacific countries. A Ministry official stated, "It is urgent to maintain close trade relations with the UK and to strengthen Korea-UK supply chains so that the UK's?EU transition can become an opportunity for our export industries."

Presiding over the meeting, Noh Geon-gi, Director General for Trade Negotiations at the Ministry, said, "We will actively resolve corporate difficulties and, with the upcoming Korea-UK FTA improvement negotiations, reflect strategic utilization of supply chains through the FTA in the negotiations to contribute to Korean companies' exports to the UK." He emphasized, "The government will continue to communicate with domestic industries and do its best to build FTA supply chains that contribute to export expansion."

On the 5th, Colin James Crooks, the British Ambassador to Korea, is speaking with Kim Ki-hyun, the leader of the People Power Party, at the National Assembly in Yeouido, Seoul. Photo by Kim Hyun-min kimhyun81@

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