A Study On China Korea FTA’s Trade Effect On Korea’s Agricultural Products

There are deep relations between South Korea and China in culture and geography, so the trade between the two countries has existed since ancient times. In 1992, South Korea and China established diplomatic relations formally, then the bilateral trade between the two countries developed rapidly because of this, each making up what the other lacks, and the increase in trade with China is more faster than other countries. But the problem is that the trading volume of agricultural products is much less than other products, and the speed of increasing is too slow compared with other products. Which results from the conservative attitude of South Korea in agricultural products, In order to avoid the concussion to native agricultural production, they are strict in controlling for agricultural products trading, both in category and volume. But the agricultural structures of South Korea and China are very similar because of geographical position and cultural habit, people’s demand of agricultural products in the two countries is also similar. In addition, the distance between the two countries is shorter compared with other countries, so the transportation expenses in international trade will be very low, so for South Korea, the cost of trade with China is lower than with other countries. We can say that there are many potentialities in agricultural products trading which need to be excavated.Scholars in both China and South Korea have done a lot of studies on agricultural products trading between the two countries, they pointed out the complementarity in the structure of agricultural products between China and South Korea, appealed the support of policies, but the governments paid little attention to this, there is little improvement for opening the market of agricultural products in South Korea. In recent years, compelled by WTO and native customers, Korean government started to face the problem of opening the market of agricultural products to other countries, especially to China. So the Free Trade Area agreement(FTA) aiming at convenience of regional trade came out, which based on the FTA among China, Japan and South Korea. Predictably, the trading situation of agricultural products between the two countries will improve a lot, there may be many problems at the same time. This paper will analyze these effects produced by the FTA, then we can take measures to solve these problems, it’s not only conducive to the development of economic and trading relations between China and South Korea, which can push the agricultural products trading, in the long run, is also conducive to further the FTA between the two countries.This paper consists of six parts. Firstly, depict the background, use the analysis methods and the innovation of the paper, which gives a research idea and an analytical frame. Secondly, collect, analyze and give a summary of the research achievements by adopting literature analysis method, which provides a theoretical basis for the paper. Thirdly, review the development of agricultural products of China and South Korea FTA. Fourthly, the current Korean agricultural trade development status and influence factors will be analyzed. Fifthly, summarize the data and effect of agricultural products trading, find the troubles and obstructive factors, bedding for the quotation of gravity model. Finally, based on the gravity model of China-South Korea FTA for South Korea agricultural products trade effect measurement, give corresponding development Suggestions.