UK automobile makers are celebrating a two-year extension to guidelines which assist British corporations to entry decrease or zero tariffs when promoting items to South Korea.

The extension has been secured underneath the UK-South Korea free commerce settlement and comes as welcome information for companies who can proceed to keep away from the excessive tariffs imposed by South Korea on merchandise getting into the nation. 

South Korea is the thirteenth largest economic system on the planet and set to develop quickly with an import market anticipated to develop 45% by 2035. The UK’s commerce with Korea has greater than doubled for the reason that unique FTA was negotiated. 

Items make up nearly all of UK exports to South Korea, with £7.3 billion value exported final 12 months. A broad vary of British manufacturing sectors are anticipated to learn from the extension, together with food and drinks and automotive, which is the second largest British export to South Korea. 

Minister for Worldwide Commerce Nigel Huddleston stated that when the UK negotiated the unique commerce settlement with South Korea, rolled over from our membership of the EU, time-restricted clauses had been agreed to permit for using EU content material in UK merchandise in assembly the EU-South Korea guidelines of origin and on delivery items by way of the EU. Each clauses had been set to run out on 1 January 2024. 

“The extensions will apply for an extra two years whereas the UK and South Korea work on new, everlasting guidelines as a part of an enhanced free commerce settlement. At present’s settlement permits for each events to increase this era additional, if wanted, “ he stated. 

Society of Motor Producers and Merchants chief government Mike Hawes stated: “We welcome this announcement because it avoids the re-imposition of duties from January 2024. Within the first half of the 12 months, South Korea was our seventh greatest automobile export market and the third greatest provider of latest passenger automobiles for UK patrons – so responsibility liabilities would have been dangerous for each side. 

“We stay up for the beginning of negotiations and swift conclusion of a modernised commerce deal that delivers extra advantages to our respective automotive sectors, specifically boosting commerce in EVs and associated applied sciences.”