South Korea has Final Talks with EU

In working to come to an agreement on a free trade arrangement, both the European Union and South Korea said that their talks on Monday would be final. Any agreement reached would then have to be approved by both South Korea and the governments that comprise the European Union.

South Korea Flags (Image: Flickr)

At the heart of these talks is protectionism. By definition, protectionism occurs when a country attempts to protect its own industries by blocking investments and exports from foreign countries. With the current global economic mess, countries that practice protectionism could make the current mess even worse. Additionally, history shows that hostility is quick to arise when protectionism is enacted.

The fact that South Korea exports more than 400,000 automobiles to Europe while only importing approximately 35,000 European automobiles per year has some nations fearing that South Korea may be headed to protectionism.

The free trade agreement that is being worked on would hypothetically cut taxes, tariffs and any other barrier between South Korea and its trade partners in Europe. Currently, South Korea does about $100 billion in annual business with Europe. Only China does more business with South Korea.