Korea, Paraguay sign economic partnership agreement on trade and investment

Korea and Paraguay have signed an economic partnership agreement on trade and investment, marking the second country in South America's Mercosur bloc to clinch such a deal, officials said Friday.

Trade Minister Cheong In-kyo speaks during a briefing in the central city of Sejong on Aug. 22, 2023. [YONHAP]

Korea and Paraguay have signed an economic partnership agreement on trade and investment, marking the second country in South America's Mercosur bloc to clinch such a deal, officials said Friday.

Trade Minister Cheong In-kyo signed the Trade and Investment Promotion Framework (TIPF) with Paraguay during a meeting with his Paraguayan counterpart, Javier Gimenez, in Seoul, according to the Ministry of Trade, Industry and Energy.

A TIPF is a nonbinding agreement that calls for enhancing economic ties and facilitating cooperative exchanges in various areas. The agreement, however, does not include tariff-free terms like a traditional FTA.

"The cooperation channel established with Paraguay's trade ministry is significant as it sets the stage for full-fledged bilateral cooperation in trade, industry and energy," Cheong said.

The ministry noted that Paraguay is an attractive trade partner, being one of the fastest-growing countries in the region, with its economy expanding 4.6 percent on year in 2023.

Paraguay also has the potential to become a significant manufacturing hub for Korean businesses in the region, the ministry added.

The ministry also pointed out that Korean cars accounted for eight of the top 20 best-selling automobiles in Paraguay last year.

Yonhap