South Korea has asked India, one of its top five naphtha suppliers, to expand naphtha exports as the blockade of the Strait of Hormuz disrupts crude oil supply. The government said it plans to launch detailed working-level consultations soon.
Yeo Han-koo, chief trade negotiator at the Ministry of Trade, Industry and Energy (MOTIE), told reporters at the Sejong Government Complex on the 31st that he had "requested an urgent expansion of naphtha supply from Indian Commerce and Industry Minister Piyush Goyal."
The move aims to increase imports of Indian naphtha as supplies from major naphtha-exporting countries such as the United Arab Emirates and Qatar face disruptions due to the war between the United States and Iran. According to the Korea International Trade Association, Korea imported approximately $1.3 billion worth of Indian naphtha (about 2.11 million tons) last year, accounting for 7.8% of the country's total naphtha imports.
"We see this in terms of responding to the immediate Middle East crisis and rebalancing the trade structure between the two countries," Yeo said. "Since I met with the Indian commerce minister in Cameroon and exchanged ideas, we will now proceed with concrete working-level consultations in earnest." Yeo had previously visited Cameroon from the 26th to 29th (local time) to attend the 14th World Trade Organization (WTO) Ministerial Conference.
Yeo also said he held a meeting with Jamieson Greer, the U.S. Trade Representative (USTR), on the sidelines of the WTO ministerial conference to discuss Korea-U.S. trade issues. "We agreed to continue close consultations to stabilize and promote digital trade in the e-commerce sector," Yeo said. "There is no need to rush the Korea-U.S. Free Trade Agreement (FTA) Joint Committee, but I think we can hold it soon once working-level progress is made."
Regarding the National Trade Estimate (NTE) report on foreign trade barriers that the USTR is expected to release soon, Yeo stressed, "Korea's risks, meaning non-tariff barriers, are on a declining trend." He added, "Even if issues arise, we will resolve areas prone to mutual misunderstanding and consult with the U.S. side in a direction that benefits Korean companies."
Meanwhile, Yeo said he plans to accelerate both multilateral and bilateral trade negotiations. "I met with member countries of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), including Singapore and Chile, to inquire about key developments," he said. "CPTPP is at a stage where we are cautiously reviewing it, taking various factors into account."
The government also agreed to discuss resuming FTA negotiations between Korea and Mexico and plans to hold a bilateral business forum soon. It will discuss ways to pursue trade agreements with Argentina and Uruguay respectively. Korea agreed with Turkey to hold an FTA Joint Committee meeting for the first time in four years, and plans to hold a Korea-EU next-generation strategic meeting between trade ministers of the two sides next month with the European Union.
