Bridging the Gap between the Ideal and Reality: Services Liberalisation in the China - Japan - South Korea Free Trade Agreement

This paper argues that services sectors cannot be overlooked in the ongoing negotiations of the China-Japan-South Korea free trade agreement (CJK FTA) given the ever-increasing significance of services liberalisation, both in global and in regional trade. The present paper maintains that in order to avoid the benefits generated by the CJK FTA from being diluted by other FTA initiatives that involve Asia-Pacific countries, particularly the Trans-Pacific Partnership (TPP) with the United States (US) in the lead, CJK FTA negotiators should strive to design a high-quality framework for services liberalisation. This paper first analyses the reality of the services industry and trade in these three countries. Then, it discusses why the three sides should pursue high-quality services liberalisation in the CJK FTA. Thereafter, the paper focuses on the key aspects of services negotiations such as market access, scheduling method, regulatory disciplines and reform, and then puts forward suggestions for bridging the gap between the ideal state of services liberalisation and the reality faced by the three parties. The TPP, TTIP, TiSA, US-South Korea FTA, and other recent developments are also given due consideration in proposing possible solutions.