As the first decade of the twenty-first century nears an end, distinct patterns are emerging in the global trading system. The Doha Development Round remains stalled and has begun to raise questions about countries’ ability to reach meaningful trade liberalization under the current multilateral structure. At the same time there has been a quickening of the pace in the development of bilateral trade deals, especially in Asia.
While economists rightfully argue that the multilateral system yields the most gains for all countries, that position tends to underplay the political reality that for each country the greatest gains in trade liberalization come from realizable yields and through agreements that a country can realistically expect to conclude. Before 2003, Korea had no free trade agreements (FTAs) and was committed to the multilateral system. Today it is negotiating or considering negotiating FTAs with the European Union, China, Japan, Australia, India, and the Gulf Cooperation Council (GCC), among a wide range of states and regional groupings.
Although Korea is still committed to negotiating multilaterally, it has undergone a significant shift toward complementing that strategy on the bilateral level. This paper will explore the changes in Korea’s FTA policy under President Roh Moo-hyun and its likely prospects under the administration of President Lee Myung-bak.