According to Yonhap News,

(SEJONG = Yonhap News) South Korea and Australia have initialed their bilateral free trade agreement (FTA) while agreeing to formally sign the trade pact within the next four months, the South Korean government said Thursday.

"(South Korea's) Assistant Minister Woo Tae-hee and Deputy Secretary Jan Adams initialed the Korea-Australia FTA in Canberra, Australia, on Feb. 10," the Ministry of Trade, Industry and Energy said in a press release.

South Korea's Deputy Trade Minister Choi Kyong-lim earlier said initialing an agreement means all negotiations for the agreement have been concluded and that the agreement will be signed as is.

Seoul and Canberra announced the conclusion of their FTA late last year after seven rounds of negotiations since 2009. The talks had hit a deadlock for 41 months over Australia's opposition to the so-called investor-state dispute settlement system, which is included in the proposed agreement.

According to a joint statement by the two countries, they have also agreed to formally sign the FTA within the first half the year.

"Both sides agree to work towards signing the 'Korea-Australia Free Trade Agreement' in the first half of 2014, after expeditiously completing their respective domestic procedures for signature, with the mutual intention that the Agreement will enter into force as soon as possible," it said.

Domestic procedures before official signing include translation of the agreement into Korean, followed by legal reviews, according to Choi.

Under the proposed FTA, Australia will remove its import tariffs on most of products from South Korea, and South Korea removes its tariffs on 92.4 percent of products from Australia in terms of their monetary value, the ministry has said.

Currently, Australia is South Korea's seventh-largest trade partner with the countries' bilateral trade volume coming to US$30.33 billion in 2013.

South Korea posted a $11.2 billion trade deficit with Australia last year despite a 9.7-percent on-year drop in its imports.