According to Yonhap News,

(BUSAN=Yonhap News) South Korea and Vietnam announced Wednesday a substantial conclusion of a free trade deal meant to boost bilateral trade by removing barriers, but excluded rice from the agreement.

South Korean President Park Geun-hye and Vietnamese Prime Minister Nguyen Tan Dung made the announcement during their meeting at a hotel in Busan ahead of a special summit to be hosted by Park for leaders of the 10-member Association of Southeast Asian Nations (ASEAN).

The two-day summit, set to begin on Thursday, is designed to boost the strategic partnership with ASEAN on the occasion of the 25th anniversary of the establishment of dialogue between South Korea and ASEAN, according to Park's office.

South Korea said a substantial conclusion of a free trade deal after nearly two and a half years of tough negotiations will help its companies expand their presence in Vietnam in such areas as automobiles, electronic appliances and cosmetics.

The agreement covers 17 areas, including products, service and investment, but the two sides agreed to exclude rice, a key staple food for Koreans, according to Park's office.

The agreement will also allow South Korean goods to compete in Vietnam, an emerging market, on a more equal footing with their Japanese competitors. A free trade pact between Japan and Vietnam went into effect in 2009.

The deal needs to go through legal reviews in Seoul and Hanoi in the first half of next year before parliamentary ratification in both capitals.

South Korea already has a free trade pact with ASEAN, to which Vietnam is a member.

Vietnam is South Korea's ninth-largest trading partner, with about US$21.09 billion worth of products shipped to the Southeast Asian country in 2013.

It is also the world's fourth-largest destination for South Korean investment that attracted some $1.46 billion from South Korea last year, according to South Korean data.

The deal with Vietnam is the latest in a series of free trade agreements that South Korea has clinched in recent years as part of its efforts to boost growth in the country's export-driven economy.

In November, Park and her Chinese counterpart, Xi Jinping, announced a substantial conclusion of a free trade deal on the sidelines of an annual summit of Asia-Pacific leaders in Beijing.

ASEAN comprises Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Thailand, Singapore and Vietnam.

entropy@yna.co.kr

Copyrights Yonhap News. All Rights Reserved.