Seoul: South Korea and Ecuador are set to sign a formal bilateral Strategic Economic Cooperation Agreement (SECA) on Tuesday, aimed at expanding ties amid global trade uncertainties, according to Seoul's industry ministry. The agreement will be signed during a meeting between Korean Trade Minister Yeo Han-koo and his Ecuadorian counterpart, Luis Alberto Jaramillo, in Seoul.
According to Yonhap News Agency, SECA is an economic cooperation agreement that covers broader areas than a traditional free trade agreement. It extends beyond trade in goods and services to include investment, technology transfer, energy and supply chain security, and infrastructure development. The two countries agreed to establish a SECA in October 2023 after nine rounds of negotiations that began in 2016. The deal requires legislative approvals from both countries to take effect.
"We hope the SECA will help Korean and Ecuadorian companies expand exports and diversify their markets, and the two countries will form partnerships in supply chains in times of crises, as well as in the IT sector," said Yeo. Under the envisioned SECA, South Korea has agreed to eliminate 96.4 percent of tariffs on Ecuadorian goods, while Ecuador will remove 92.8 percent of tariffs on Korean goods.
Ecuador will gradually eliminate the current 35 to 40 percent tariffs on Korean-made passenger cars and trucks within 15 years of the agreement's entry into force. For hybrid models, South Korean cars will face zero tariffs in Ecuador within five years, aligning with Ecuador's policy to promote eco-friendly vehicles.
Additionally, Ecuador will lift the 20 and 30 percent duties on Korean cosmetics and instant noodles within 10 years, 5 percent duties on Korean seaweed products within five years, and 20 percent duties on health drinks within seven years. For Korean pears, Ecuador agreed to instantly abolish the 15 percent tariffs when the SECA takes effect.
The ministry stated that these measures will help South Korea expand its presence in Ecuador, a market enriched with energy and mineral resources, as well as in the broader Latin American region. In 2024, South Korea traded US$802 million worth of goods with Ecuador, exporting diesel, engines, and auto parts, while importing crude oil, fruit, and shrimp.
The envisioned SECA will also facilitate Korea's export of financial, communications, and digital services, including media content, to Ecuador and help break into the country's public procurement market, the ministry added.