Shandong Province is the nearest province to Korea and the most active one to have economic exchanges with Korea. After the China-Korea Free Trade Agreement formally goes into effect, Shandong is allowed to further its cooperation with Korean FTA in the field of Finance, Investment, E-commerce and Economy, etc.

“In total, the China-Korea FTA will further expand the import & export scale of Shandong. Over 4000 local enterprises are estimated to be benefited from this cooperation.” said Jia Jiqing, Section Chief of Asia Affair Office, a Department of Commerce of Shandong. “However, the opening of market will introduce advanced Korean products into Shandong market, which will bring a huge strike to the industries with relatively weak advantages in Shandong, such as middle- and high- end machines and equipments, chemical engineering, and auto parts, etc. Transformation process in these industries will undoubtedly be accelerated.”

Based on the schedule of concessions in China-Korea FTA, parts of the tax items will gradually reduce to zero tariffs with the next 5 to 20 years, while within the next 10 years, most of the China-Korea zero-duty products will simply eliminate the duty. It was said that 71% of Chinese products will eliminate the tariff within 10 years, covering 66% of the gross import from Korea and 79% of Korean products will eliminate the duty in the next 10 years, taking 77% of the total import value from China. Parts of the tax items which were agreed to a tax reduction will basically reduce to the agreed tax level. And the products with tariff quota will have their tariff rate reduce to zero after the FTA goes into effect.