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South Korea's Industry Minister Sung Yun-mo inked the comprehensive economic partnership agreement (CEPA) with his Indonesian counterpart Agus Suparmanto to pave the way for local exporters to penetrate deeper into the Southeast Asian market.
The Seoul-Jakarta CEPA, which marks the country's third individual trade pact with a Southeast Asian nation, now needs parliamentary approval.
Negotiations between the two countries resumed in 2019 after a five-year hiatus.
It is expected to grant South Korean exporters wider access to Indonesia, which has the largest population among Southeast Asian nations.
The CEPA is equivalent to a free trade agreement but focuses on a broader scope of economic cooperation.
South Korea is awaiting the official launch of the Regional Comprehensive Economic Partnership (RCEP), which would bolster dialogue with the ASEAN, China, Japan, Australia, and New Zealand.
South Korea expects the CEPA to supplement multilateral systems, such as the RCEP, and further advance trade networks in Southeast Asia. The country has been eyeing separate deals with other Southeast Asian nations on top of the existing FTA with the ASEAN, to bolster strategic and economic relations with Asian partners, and reducing its heavy dependence on the US and China.
South Korea implemented FTAs with Singapore in 2006 and Vietnam in 2015 and is negotiating with Malaysia, the Philippines, and Cambodia.
