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South Korea and the European Union kicked off their second round of negotiations Monday aimed at framing an ambitious free trade agreement that could provide South Korea with a crucial commercial bridge into Europe.

The chief negotiators, Deputy Trade Minister of South Korea Kim Han-soo and his counterpart Ignacio Garcia Bercero, director of trade relations at the European Commission, began the talks by shaking hands and exchanging greetings at the Charlemagne Building near the EU headquarters in Brussels.

"As both sides have fully discussed pending issues before the second round, I would like the talks to proceed with a forward-looking attitude," Kim told reporters.

Garcia Bercero, echoing remarks by Kim, said that both sides will put all the issues on the negotiating table that they want to proceed ahead with this week.

"I think we will have a number of difficulties, but I hope we will tackle those issues in a constructive manner," said the EU's chief negotiator, declining to give information about what those difficult issues are.

About 180 negotiators from the two sides will try to thrash out complex tariff offers and other nontariff issues at the five-day meeting in this European city.

The first round was held in May in Seoul after South Korea reached a free trade agreement with the United States in early April.

After the "opening plenary" on Monday, four negotiating groups -- on trade in goods, services and investment, regulations and sustainable development and dispute settlement --are getting down to bargain, said Han Dong-man, a spokesman for the South Korean delegation.

Both sides already exchanged initial tariff proposals. The EU has offered to eliminate or phase out all its import tariffs on South Korean goods within seven years after a deal comes into force, while South Korea has proposed to do so for about 80 percent of tariffs on European goods within five years.

South Korean negotiators said the EU's tariff proposal is "higher than expected" and hinted they may use nontariff issues such as services and investment as a bargaining chip to meet the EU's demands on tariff reduction.

Potential sticking points are automobiles, pharmaceuticals and cosmetics.

Noting the difficulties ahead, the chief South Korean negotiator Kim said earlier, "This week's negotiations are aimed at establishing a common understanding for further discussions, rather than a real give-and-take bargaining." "Given the complexity and size of trading relationship between the two sides, the negotiations will not be easy," Kim said.

Compared with free trade negotiations with the U.S., experts said, South Korean negotiators may feel less pressure, as both Seoul and Brussels will probably reach an agreement to exclude some sensitive agricultural items, including rice. The EU also needs to made concessions on agriculture, where its barriers and subsidies are huge.

The EU is South Korea's second-largest trading partner after China, with bilateral trade reaching US$79 billion a year. The EU is also the largest foreign investor in South Korea with $40.4 billion invested at the end of 2006, according to the South Korean government.

Though no particular deadline was set to conclude the talks with the EU, South Korean officials say they hope to wrap up the negotiations by the end of this year.
BRUSSELS, July 16 (Yonhap News)