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South Korea and China announced Wednesday the start of free trade negotiations,
setting in motion a process to tear down trade barriers between two of Asia's
South Korean Trade Minister Bark Tae-ho said in a press briefing held in Beijing that the first round of talks on a bilateral free trade agreement (FTA) will be held later this month.
Earlier on Wednesday, Bark held a meeting with his Chinese counterpart Chen Deming in Beijing, exchanging views over the possible agreement between the neighboring countries.
China is South Korea's largest trading partner, with bilateral trade expected to reach US$300 billion by 2015.
The announcement came four months after the leaders of the two trading partners agreed to kick off free trade talks at an early date.
Since 2008, South Korea and China had held a series of joint feasibility studies on a possible free trade deal and exchanged views on sensitive issues.
Agriculture and fisheries are considered to be the most sensitive sectors of the South Korean economy, while China categorizes its manufacturing industries, which include the automobile, machinery and oil sectors, as sensitive.
The two sides have not set a timeline for striking the deal, South Korean officials said.
However, Chen, the Chinese minister of commerce, said he hopes a bilateral deal will be finalized within two years.
South Korean officials added that South Korea and China have agreed to consider allowing preferential tariffs on goods produced in designated outward processing zones. South Korea has an outside industrial complex in the North Korean city of Kaesong, across the border.
South Korea has major free trade pacts with the U.S. and the European Union (EU). It also has similar pacts with Chile, Singapore, the Association of Southeast Asian Nations and India.