The Impact of Preferential Rules of Origin on Trade Defletion in the Regional Trading Bloc

At the early stage of the promotion of Korea-Chile FTA, more disputes related to reducing tariff might appear; however, with the consultation going on, the trade union possibly might pay more attention to the rule of origin. The purpose of this research is to emphasize the significance of the special preference of rules of origin which aims at reduce the trade difficulties in FTA, and bring forward the way to reduce the twisted effect of trade by using rules of origin. According to the result of this successful study, the prediction of the economic effect which comes with the decline of tariff between Korea and Japan under the framework of FTA might be different according to whether the rules of origin are considered. The enlightenment of this study is that in order to maximize the economic effect of concluding FTA, a close consultation between the trade union with different preference of origin rule and the leaders of the government is very important.