KOREAN FREE TRADE AGREEMENT NEGOTIATIONS IN GOVERNMENT PROCUREMENT: RESULTS AND POLICY SUGGESTIONS

The government procurement market is one of the few markets where substantial trade barriers still exist. Many countries, including Korea, have been trying to reduce these market barriers through the World trade Organization (WTO) plurilateral government procurement agreement (GPA) and foreign trade agreement (FTA) negotiations. The actual results have been somewhat disappointing. This paper argues that one factor behind the disappointing results may be Korea's negotiating text, heavily influenced by the GPA, that includes several provisions which may hinder efficiency and add to procurement costs. The paper offers a policy option for Korean FTA negotiators - a "half track" approach where Korea can offer mutual national treatment to the suppliers of the FTA partner with no (or very little) additional procedural or transparency requirements such as those associated with the GPA -type provisions.