Korea Customs Service: "Targeted Support by Item and Region... Securing FTA Export Momentum"

The government is set to identify export items, regions, and regional groups with low utilization of Free Trade Agreements (FTAs) and provide focused support to secure new export growth engines.

On the 12th, the Korea Customs Service announced the "Customs Administration Promotion Strategy for Supporting FTA Utilization" at the National Policy Issue Ministers' Meeting, which also served as the Economic Relations Ministers' Meeting and the Industrial Competitiveness Enhancement Ministers' Meeting.

The promotion strategy focuses on ▲ securing new export growth engines through pinpoint support by item ▲ improving conditions for FTA utilization to enhance corporate benefits ▲ resolving non-tariff barriers through strengthened international cooperation.

Currently, Korea has 22 FTAs in effect with 59 countries, accounting for 77% of total trade volume. The Customs Service assesses that the FTA utilization rate has entered a "stable utilization phase," with 86.3% for exports and 85.4% for imports.

However, opportunities to utilize FTAs with the United States and the European Union still exist, and there is a need to increase the utilization rate of new FTAs in regions such as ASEAN and Central America. Additionally, differences in FTA utilization by item and region remain challenges to be addressed.

For example, household goods (69.2%) and textiles (58.1%) have relatively low FTA utilization rates compared to other items, and regional differences are significant, with Gyeonggi-do at 72.0% and Chungbuk at 79.6%, compared to the national average of 86.3%.

Accordingly, the Customs Service plans to select 12 items with annual export values exceeding $100 million but with less than 30% FTA utilization, and 13 items with annual exports over $10 million that do not utilize FTAs, to provide cause-specific consulting and support FTA utilization enhancement through cooperation with relevant ministries.

First, to strengthen FTA utilization in the central region, the establishment of the Pyeongtaek Customs Export-Import Enterprise Support Center is underway. Through this, dedicated customs offices will operate by industry: cosmetics and used cars in Incheon, food, bio, and cosmetics in Seoul, seafood in Busan, and textiles in Daegu, to reinforce FTA utilization support.

Support for promising export items linked to the Korean Wave will also be expanded. When issuing certificates of origin for items such as K-beauty and K-food, the required supporting documents will be drastically simplified from the current eight types to one, reducing the burden of origin verification. This is interpreted as a strong commitment to expanding export scope through the Korean Wave.

Efforts will also be intensified to improve conditions for FTA utilization and enhance corporate benefits. The Customs Service plans to provide customized consulting for SMEs in high-risk groups for origin violations and strengthen post-management of certified exporters.

Additionally, in collaboration with the Financial Services Commission, Industrial Bank of Korea, and Korea Trade Insurance Corporation, financial support will be provided to export companies utilizing FTAs, and participation in the Ministry of SMEs and Startups' export voucher collaboration project will further improve corporate convenience.

The Customs Service will also focus its institutional capabilities on resolving non-tariff barriers through strengthened international cooperation. To this end, Korea-led electronic certificate of origin (e-C/O) international standards will be established by building an EODES with countries such as the Philippines, completing the e-C/O chain between Korea and ASEAN. EODES electronically exchanges certificate of origin information with the customs authorities of the counterpart country in real time, shortening import clearance times and reducing logistics and other corporate costs.

Furthermore, the Customs Service plans to dispatch local support teams to countries where large-scale customs clearance disputes occur and, if necessary, hold high-level meetings such as Customs Commissioners' meetings to help resolve customs clearance disputes.