The long-awaited implementation of the Free Trade Pact between the Republic of Korea, or South Korea, and the U.S. (KORUS) is scheduled to go into effect on March 15. The date will see the conclusion of negotiations that began in 2006, and will, according to proponents, significantly increase trade between the two nations.
The overall goal of the agreement is to eliminate around 95 percent of the previously existing trade tariffs within five years. More significantly for the financial services industry, including insurance, it projects a number of regulations and protective measures to facilitate new business opportunities in these sectors.
The American Insurance Association’s vice president and associate general counsel, David F. Snyder, issued a statement on KORUS’ implementation date, stating that it is “particularly significant for insurers as Korea is one of the top 10 insurance markets in the world.
“This agreement sets a new and higher standard for insurance provisions in other free trade agreements currently being negotiated, he added. “KORUS creates an excellent model that assures good regulation while encouraging full and open competition.”
Snyder described free trade agreements as a “vital component” for maintaining “American competitiveness internationally. he observed that “granting U.S. insurers greater access to foreign markets is an essential component to maintaining a robust insurance marketplace. Free trade agreements like KORUS not only help the U.S. economy but promote the economic growth of our trade partners as well.”
The AIA also noted that “U.S. and Korean negotiators have just completed their review of each nation’s respective laws and regulations as necessary for KORUS to enter into force. In addition to the favorable tariff-related measures that will go into effect, enhanced regulatory transparency and access to Korea’s $580 billion services market will also become effective on March 15.”
The trade pact is by far the largest and most far reaching agreement to go into effect since the adoption of NAFTA.
Source: American Insurance Association
Was this article valuable?
Here are more articles you may enjoy.