KUALA LUMPUR: The urge for both Malaysia and South Korea to establish the bilateral free trade agreement (FTA) has become imperative in order to further deepen the existing economic ties shared by the two nations, South Korean Ambassador to Malaysia Lee Chi Beom said.

He said with the Regional Comprehensive Economic Partnership (RCEP) Agreement entering into force early this year and other regional arrangements such as the Indo-Pacific Economic Framework (IPEF) being discussed by governments these days, the bilateral FTA is getting relatively lower attention and the momentum has been slightly weakened as well.

"As the scope of our economic exchange gets broader, it is anticipated that the need for a bilateral FTA, that covers country-specific characteristics which are often overlooked by FTAs like RCEP, will become greater.

"That is why it is crucial for both our governments to maintain the momentum of the bilateral FTA negotiations and I hope to see greater commitments made by our governments to actualise it," he told Bernama in an exclusive interview recently in conjunction with Korea's National Foundation Day observed on October 3.

Lee said although South Korea already has a separate FTA with the ASEAN, the country has yet to conclude one with Malaysia ever since both nations commenced negotiations on the bilateral FTA in 2019.

He said notwithstanding the pandemic situation over the past two years, bilateral relations have registered remarkable progress alongside the two countries' economic growth ever since diplomatic ties were established in February 1960.

"Most notably, our bilateral trade volume has grown 7,200 times over the past 60 years and the trade flows continued to increase even during the COVID-19 pandemic.

"Although the pandemic has slowed down the growth, our people-to-people exchange has breached the one-million mark for the first time in 2019. Fortunately, the numbers are slowly picking up again ever since the reopening of borders," he said.

According to the South Korean embassy in Malaysia, the bilateral trade volume was recorded at US$20.6 billion last year as compared to the previous year's US$28.2 billion.

Back in 1965, it was just around US$2.83 million.

Asked on how economic relations could further bloom, he said there is always room for potential cooperation to be continuously expanded and strengthened.

Lee said he is optimistic that this year's bilateral trade volume could reach higher than the last year's figure as bilateral trade and investment continue to increase despite the pandemic.

"In terms of economic cooperation, I think the increase was possible because of the solid economic foundation built over the years between South Korea and Malaysia," he said.

He said many other companies are also looking for business opportunities in Malaysia in response to the global supply chain restructuring, climate crisis and energy transition.

"I expect such a trend to continue with the RCEP that came into effect early this year," he said.

He added that the embassy here is also planning to establish a Consulate General office in Kota Kinabalu soon.

In the past two years, South Korean companies which opened up branches in Malaysia included the Korean Education Centre and KOTRA's Korea Business Centre Korea Water Resources Corporation and Korea Agro-Fisheries and Food Trade Corporation.

Most recently, the Korea Environment Corporation opened its Southeast Asia Regional Office in Kuala Lumpur this month.

Malaysia is the third-largest trade partner of South Korea in Southeast Asia.

-- BERNAMA