hankyoreh

Forging a free trade agreement with North Korea would be a daunting task, but it's not impossible, South Korea's trade minister said Thursday, amid media reports the two Koreas may discuss a commercial pact in their second summit.

South Korean President Roh Moo-hyun will meet North Korean leader Kim Jong-il on Oct. 2 in Pyongyang, the first such meeting in more than seven years after Kim met Roh's predecessor in June 2000. Both sides had originally planned to meet this week, but the North delayed the summit, citing major damage from heavy rains.

The postponement will allow the two sides more time to debate the specific agenda for the October summit. Government officials and experts say the summit is expected to focus on economic cooperation rather than efforts to dismantle the North's nuclear weapons program.

Kim Jong-hoon, the South Korean Trade Minister, said the potential free trade deal between the two Koreas has created uncertainty because North Korea isn't a member of the World Trade Organization (WTO).

"However, there is no problem for North Korea to have an FTA with South Korea even though the North isn't a member of the WTO," Kim told a KBS radio. "There are some examples of some non-WTO members signing FTAs." "What's more important is how to reduce the North's systematic barriers in trade," said Kim.

In a speech on Aug. 15, President Roh said he will discuss the formation of an "inter-Korean economic community" with the North Korean leader.

South Korea is already one of the North's major economic partners.

Sixteen South Korean firms operate factories at an industrial park in the North Korean city of Kaesong, just 70 kilometers north of Seoul. More than 1,000 plants are expected to operate in the Kaesong industrial zone by 2012.

South Korea cherishes the economic enclave as a symbol of reconciliation and cooperation launched after the breakthrough summit in 2000.

Two-way trade between South and North Korea has reached US$1.3

billion a year and South Korea has invested a total of $1 billion in North Korea, Kim said.

"We need to cope with the possibility of a further rise in inter-Korean trade," Kim said.

The second summit comes as North Korea has made progress in dismantling its nuclear weapons program.

Under a February agreement with South Korea, China, the United States, Russia and Japan, North Korea shut down its only plutonium-producing nuclear plant in Yongbyon in return for energy aid.

The shutdown of the North's reactor, verified by United Nations nuclear inspectors, is the first step toward dismantling the North's nuclear program.

SEOUL, Aug. 30 (Yonhap)