New Trade Relations with the U.S. Could Help South Korea and Its ETF

In the recent circuit through Asia, President Barack Obama met up with South Korea’s President in order to further trade negotiations between the two countries. South Korea’s economy and ETF, may have made a full recovery and normal growth could likely resume.

Obama and South Korea President Lee Myung-Bak both expressed their desire to complete a long-stalled trade agreement between their two respective countries, reports Edmund L. Andrews for The New York Times. Obama is pushing for open access to South Korean markets.

The trade agreement has been previously stalled because of criticism that the flood of imports would come at the expense of American jobs. Critics in the United States also complain that the agreement doesn’t address South Korea’s regulatory and tax barriers imposed on imported products.

South Korea has already negotiated a trade agreement with the European Union.

Japanese Finance Minister Yoon Jeung-hyun stated that South Korea’s growth for the next year “will likely be better than the government’s earlier forecast of a 4% expansion,” according to Express India. The country’s economy has returned to pre-crisis levels, but a tightened labor market and rising commodity prices could impede future growth.

• iShares MSCI South Korea (NYSEArca: EWY): up 68.5% year-to-date

Max Chen contributed to this article.