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The 2nd WTO Trade Policy Review of the Kingdom of Saudi Arabia (4 and 6 April 2016)
Statement by the Republic of Korea
1. Opening Remarks Thank you, Madam Chair,
I would like to extend a warm welcome to the delegation of the Kingdom of Saudi Arabia for its 2nd trade policy review, and especially would like to thank Ambassador Abdolazeez Al Otaibi for his comprehensive presentation. My special thanks go as well to Ambassador MOLINARI of Costa Rica for his contribution as a discussant and to the Secretariat for its informative report.
2. Bilateral Economic Relationship
Saudi Arabia became the fourth largest trading partner of Korea in 2014. As the Korea’s largest petroleum supplier, Saudi Arabia has played a key role in Korea’s economic growth. Korea has also contributed to the economic development of Saudi Arabia by participating in building infrastructure such as highways, harbors and plants.
Although bilateral trade decreased in 2015 due to the decline of oil prices, I believe that both countries will continue to strengthen the comprehensive economic partnership based on close economic relations developed so far.
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3. Korea’s Comment on the Trade Policies of Saudi Arabia
Turning to the report on the trade policies of Saudi Arabia, it is noted that Saudi Arabia continues to rely on its oil production despite its seeking to diversify its economy. The current macroeconomic indicators of Saudi Arabia also show how its economy and fiscal situation are vulnerable to the price of oil.
In this regard, Korea would like to encourage Saudi Arabia to continue its effort to diversify its economy geographically, vertically in sectors linked to oil, and into new industry sectors under its 10th Development Plan.
Korea, as a close economic partner, would like to join Saudi Arabia in this effort. I believe that both countries can expand economic cooperation into promising sectors such as nuclear and renewable energy, and the service industry including health and medical care.
4. Korea’s Concern on the Trade Policies of Saudi Arabia
Madam Chair, I would like to take this opportunity to express a concern on the trade measures of Saudi Arabia.
In last December, the GCC Secretariat in Saudi Arabia decided to initiate anti-dumping investigations on five Korean companies exporting automobile batteries. Although the investigations are currently underway, we hope Saudi Arabia conducts its investigation in careful consideration of the following facts.
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First, there is no cause-and-effect relationship between the import of Korean products and actual damages to domestic manufacturers in Saudi Arabia. Second, battery manufacturers in Saudi Arabia do not have sufficient production capacity to meet the domestic demand, and therefore the imposition of countervailing duties is likely to cause a contraction of the battery market and infringe on consumers' rights.
5. Closing Remarks Madam Chair,
It is our hope that Saudi Arabia will continue to constructively participate in strengthening the WTO multilateral trading system. In this context, we encourage Saudi Arabia to facilitate its domestic procedure for the acceptance of the Trade Facilitation Agreement. We also hope that favorable consideration could be given to Saudi Arabia for joining GPA and ITA expansion.
With this, I would like to conclude by expressing our appreciation to the delegation of Saudi Arabia for its hard work and wishing the delegation every success in its TPR. Thank you.
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