Korea (Rep.) and Paraguay signed a memorandum of understanding (MoU) on the Trade and Investment Promotion Framework (TIPF) on 23 August 2024.
According to the Ministry of Trade, Industry and Energy, Minister for Trade Cheong In-kyo and his Paraguayan counterpart, Javier Gimenez, signed the TIPF in a ceremony in Seoul.
“The cooperation channel established with Paraguay’s trade ministry is crucial, as it lays the foundation for comprehensive bilateral cooperation in trade, industry, and energy,” said Cheong.
The ministry highlighted that Paraguay is an appealing trade partner, being one of the fastest-growing countries in the region with its economy expanding by 4.6% year-on-year in 2023.
The ministry also noted that Paraguay has the potential to become a key manufacturing hub for Korean businesses in the region. Additionally, it highlighted that Korean cars comprised eight of the top 20 best-selling vehicles in Paraguay last year.
The framework aims to enhance mutually beneficial economic cooperation and tackle emerging trade issues such as supply chains, green energy, the digital sector, and biotechnology. Unlike a free trade agreement, it does not involve tariff negotiations but focuses on strengthening practical industrial relations.
A TIPF is a non-binding agreement that aims to strengthen economic ties and promote cooperative exchanges across various sectors. Unlike a traditional free trade agreement (FTA), it does not include provisions for tariff-free terms.
