March 9, 2014 / 2:17 PM / 5 years ago

Canada, South Korea close to free trade deal: Canadian PM

TORONTO (Reuters) - Canada Prime Minister Stephen Harper said on Sunday he hopes to finalize a free trade agreement with South Korea during a trip there this week.

Canada's Prime Minister Stephen Harper listens to a speech during an award presentation at Rideau Hall in Ottawa March 6, 2014. REUTERS/Blair Gable

Sources familiar with the negotiations had said last week that the two sides were very close to signing a long-delayed free trade deal after years of talks.

Harper confirmed a deal is close in a video posted on his website as his office released details of the March 9 to 11 trip.

“We will be hoping to finalize a Canada-Korea free trade agreement,” he said.

Canada, seeking to diversify its exports away from the United States, has long targeted the rapidly expanding economies of Asia.

Canada’s Trade Ministry said exports to South Korea in 2012 were worth C$3.7 billion ($3.34 billion) while imports from South Korea hit C$6.4 billion.

Talks with South Korea began in 2005, but later stalled over disputes about auto exports and a delay by Seoul in scrapping its ban on Canadian beef. South Korea lifted its nine-year-old ban in 2012.

Some Canada-based auto firms worry about a free-trade deal on the grounds it would cut an existing 6.1 percent tariff on imports of vehicles made by Kia Motors Corp and Hyundai Corp.

But a free trade deal would be particularly welcome news for Canadian beef and pork shippers, who fear shipments to South Korea will shrink once Seoul’s free trade deal with the United States takes full effect in 2016.

The Canadian Council of Chief Executives last month sent a letter to Trade Minister Ed Fast urging the deal be completed, saying the United States, the European Union and Australia had already concluded agreements with South Korea.

($1 = 1.1074 Canadian Dollars)

Reporting by Jeffrey Hodgson; With additional reporting by David Ljunggren in Ottawa; Editing by Rosalind Russell

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