Paradigm Shift of the EU’s Preference of Trade Relations: The Case of the EU-South Korea FTA

Abstract

The EU’s trade preference plays an important role in shaping the world economy, as the EU is a highly formidable trade power worldwide. In shaping the global trade environment, two competing mainstream strategies exist: multilateralism led by WTO negotiation; and bilateralism, in which actors settle trade-related issues between themselves. Due to the EU’s significance in global trade, the EU’s choices and actions will have a great influence on the success of these two forces. This study explores the paradigm shift of the EU’s preference on a global trade arrangement in the mid-2000s. The EU-South Korea FTA is taken as an example, because the EU-South Korea FTA is considered to be the EU’s first new-generation free trade agreement. The EU asserts that its changing attitude towards bilateralism will not endanger the multilateralism that it has long supported. It also states that bilateralism constitutes a supporter of multilateralism. The EU’s paradigm shift of trade preference would have an enormous influence on global trade. Whether this shift will contribute to multilateralism, as it states, or whether the change will be deleterious to multilateralism, remains to be determined.