UK–South Korea trade deal set to boost Welsh exports and services growth
UK–South Korea trade deal set to boost Welsh exports and services growth
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A newly finalised free trade agreement between the UK and South Korea is expected to deliver a significant boost to the Welsh economy, supporting exporters, securing jobs and opening up new opportunities for services firms and manufacturers.
The agreement, announced by Trade Minister Chris Bryant and South Korea’s Minister Yeo Han-koo at Samsung KX in London on Monday (December 15), is the fourth major trade deal concluded by the UK government this year, following agreements with India, the European Union and the United States and follows a round of high-level talks between the two governments last week.
Ministers say the deal will lock in tariff-free access across 98% of tariff lines, protecting existing trade flows while creating new export opportunities across goods and services.
For Wales, where exports to South Korea already exceed £280 million, the agreement is expected to support further growth in key sectors including machinery, automotive manufacturing and advanced services.
Wales currently exports more than £227 million worth of machinery to South Korea, with power-generating machinery exports increasing by more than 50% since 2023.
The automotive sector is also positioned to benefit, with Welsh exports of road vehicles reaching £3.7 million in 2024, representing a 57% increase on the previous year.
Across the UK as a whole, the government estimates the deal could increase services exports to South Korea by £400 million.
South Korea is already the UK’s second-largest services export market after the United States, and the agreement secures improved access to its expanding financial and professional services sector.
Some £2 billion worth of UK exports were weeks away from facing higher tariffs, according to the government, but will now benefit from permanent preferential access to one of Asia’s most advanced economies.
Prime Minister Keir Starmer said: “This is a huge win for British business and working people and marks our 4th major agreement in 2025 after the EU, India and US.
“From food to TV, music and more, Korean culture is already influential here in the UK. This deal making trade even easier between us will help boost the economy – supporting jobs and growth which will be felt all over the country.”
Trade Minister Chris Bryant MP said: “Korean culture has taken off in the UK, with millions of Brits already binge watching great Korean TV like Squid Game and streaming K-pop artists like Blackpink – but this trade deal will take our relationship to the next level and turbo-charge it for businesses who will have hundreds of millions in opportunities unlocked.
“Today’s agreement secures the UK as a global leader in digital trade and innovation while boosting our world class services sector, supporting iconic brands, and giving cast-iron protections to our key industries to speed up economic growth as part of our Plan for Change.”
Secretary of State for Wales Jo Stevens said: “This is a landmark deal that will enable Welsh exporters to South Korea to grow their businesses and create new jobs.
“It further unlocks the immense potential for growth across Wales’s key industries, including machinery businesses, by providing them with better access to a growing market.
“Following recent trade deals with India, the EU and the US, this is real boost for the UK economy and will put more money back in the pockets of businesses and consumers across Wales.”
Improved access to South Korea’s financial market is another key component of the deal, building on £1.1 billion in UK financial and insurance exports recorded in 2024.
The government says these provisions will strengthen the UK’s position as a global services hub while supporting long-term growth in high-value sectors.
William Bain, Head of Trade Policy at the British Chambers of Commerce (BCC), said: “This looks to be a well-tailored deal that will suit the commercial interests of both our countries. Around £15bn worth of goods and services is already flowing between our nations annually, which puts South Korea in the top 25 of UK trading partners.
“Businesses had a number of priorities for these negotiations which look to have all been met. These included long-term clarity on rules of origin, which will benefit the automotive industry.
“Alongside this were additional agreements on market access in services, and quicker, cheaper and simpler goods trade through effective customs reforms and better use of electronic trade documentation.
“We now have the potential to boost trade and investment levels ever higher, with the world’s 12th biggest economy at the heart of a fast-growing economic region.”
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