| SEOUL, July 4
SEOUL, July 4 China and South Korea's vow to
wrap up talks on a trade deal by year-end may prove optimistic,
as differences over opening markets for petrochemicals, steel
and agriculture could delay a deal, a senior South Korean trade
ministry source said on Friday.
Trade between the two countries totalled $230 billion last
year and Chinese President Xi Jinping and Korean President Park
Geun-hye pledged at Thursday's summit in Seoul to work towards
concluding free trade talks by the end of the
However, the senior ministry source familiar with the matter
told Reuters that substantial differences remained.
"If the wide opinion gaps don't narrow down, it is possible
to be pushed to next year," the source said on condition of
anonymity, given the sensitivity of the matter.
China's Ministry of Commerce could not be reached
immediately for comment.
China is the world's largest exporter and South Korea the
seventh. A trade deal would remove or significantly lower
tariffs on exports between the two.
Beijing wants to boost exports of labour-intensive produce
such as fruits and vegetable to South Korea, where farmers say
they have already been battered by a U.S. trade deal that took
effect in March 2013. Producers say they now face pressure to
open up the country's rice market under the World Trade
China also wants more South Korean market access for cars,
electronics and steel.
"We are well aware of big concerns in agricultural sectors,
along with rice issues," the source said.
South Korea is one of the few developed countries that has a
trade surplus with China, its biggest export market. China
accounts for more than 60 percent of South Korea's petrochemical
Some Chinese sectors that South Korea's industrial giants
covet, such as autos, steel and petrochemicals, are reluctant to
"Chinese across manufacturing sectors are also very
concerned about a deal although the degree of the concern varies
depending on sectors," the source added.
China and South Korea launched free trade talks in 2012.
"Some Chinese industries are not willing to open further,
such as chemicals, shipbuilding, steel, and auto. Some are
complaining about Korea's protection, like agriculture," said Tu
Xinquan of the University of International Business and
Economics in Beijing.
"But the two governments need something meaningful to show
friendship, so I believe the negotiation will finish as
Beijing and Seoul have been strengthening trade and
diplomatic ties - this week's summit meeting between Xi and Park
was their fifth since both took office last year.
(Additional reporting by Hyunjoo Jin in SEOUL and Niu Shuping
and Michael Martina in BEIJING; Editing by Tony Munroe and Ron