South Korea aims for a comprehensive economic partnership agreement with Morocco before mid-2027.

Written by: Ayman Ragab

South Korea is looking to conclude a comprehensive economic partnership agreement with Morocco before mid-2027, with the aim of boosting trade and investment, and creating a more competitive environment for Korean companies in the Moroccan market.

South Korean Trade Minister Yoo Han-koo said that Korean companies are facing difficulties competing in Morocco under the current conditions, explaining that the customs duties imposed on Korean components limit the ability of these companies to use Morocco as a base for manufacturing cars, batteries and other products destined for European markets, while companies from other countries benefit from customs exemptions under free trade agreements.

Ensuring equal opportunities for investors

The minister explained that the Comprehensive Economic Partnership Agreement, which includes customs duties, investment and public procurement, represents the ideal framework for achieving equal opportunities for investors, noting that the absence of such an agreement weakens the competitiveness of Korean companies in Morocco.

He pointed out that China has strengthened its investments in the battery sector in Morocco in recent years, while the volume of trade between Beijing and Rabat is about nine times that of Seoul and Morocco. India and Japan are ahead of South Korea in terms of industrial and commercial presence, which makes Seoul’s position “below the required level.”.

He stressed that his country is not adequately benefiting from the opportunities available in the Moroccan market, noting that the Korean government is seeking to reduce this gap, especially with Morocco preparing to implement major infrastructure projects in preparation for hosting the 2030 World Cup.

Yoo Han-koo revealed that Hyundai Rotem won a $1.5 billion contract in 2025 to supply the National Railway Office with trains, considering this project a model of the great opportunities that Korean companies can achieve in Morocco, with other investment opportunities that may reach hundreds.

He added that Korean companies are characterized by speed of execution and the ability to bear risks, as well as their commitment to completing projects on schedule and within budgets.

Regarding future investments, the minister explained that LG Energy Solution is in advanced talks to establish a lithium refinery in Morocco, describing the Kingdom as a strategic location for serving European, American, and regional markets. However, he noted that high costs, coupled with customs duties that can reach 301 TP3T on equipment and components imported from Korea, represent the most significant obstacles to the expansion of Korean companies, while competing companies benefit from customs exemptions thanks to free trade agreements.

Public procurement challenge

He added that public procurement poses an additional challenge for companies coming from countries that do not have trade agreements with Morocco, which widens the competitiveness gap, stressing that current Korean investments, despite their increase, do not achieve the required commercial viability in the absence of a comprehensive agreement.

He revealed that the trade ministers of the two countries, along with the Moroccan Minister of Investment, agreed to form a working group and launch formal negotiations before the end of this year, paving the way for a broad agreement within a short period.
The minister pointed out that South Korea had previously concluded similar agreements with countries such as Serbia and the United States within short periods of time, expressing his confidence that a similar agreement could be reached with Morocco.

He stressed that his country’s interest in Morocco is also linked to the possibility of turning it into a production and export platform towards African markets, in light of the absence of a free trade agreement between South Korea and African countries, considering that the anticipated agreement will make the Kingdom a regional industrial center for Korean companies.

He added that the agreement would also benefit Morocco, by enhancing its openness to Asian markets and Korean supply chains, as both countries seek to diversify their trade partners.

According to United Nations trade data, Morocco's exports to South Korea amounted to $61 million in 2024, compared to imports of $908 million, resulting in a trade deficit of $847 million in favor of Seoul, while electronics, machinery and vehicles accounted for the largest share of Korean exports to Morocco.

The South Korean trade minister concluded his remarks by emphasizing that the agreement, if signed, would begin to yield results within two to three years, through increased trade volume, higher investments, and enhanced economic relations and exchange between the two countries… as reported by Hespress English.