South Korean and Chinese businesses and institutions signed several agreements Friday aimed at expanding commerce and trade on the sidelines of the bilateral summit meeting in Seoul.
The Korea Exchange (KRX) and Bank of China said they will develop financial products based on the Chinese yuan, after South Korean Park Geun-hye and her Chinese counterpart, Xi Jinping, agreed Thursday to launch a new two-way foreign exchange market that can fuel trade and reduce losses caused by using the U.S. dollar as the medium of trade.
The KRX-Bank of China agreement will allow the latter to act as the organization responsible for settling accounts. The two sides also agreed to work together when yuan-based financial products are traded on the South Korean exchange, and take cooperative measures to explain Seoul's market conditions to Chinese companies and potential investors.
POSCO, the world's fourth-largest steelmaker, signed a memorandum of understanding (MOU) with China's Chongqing Iron & Steel Co. on building a steel mill in the world's second-largest economy.
The mill will use FINEX technology that can make high-quality steel at significantly less cost. It is also more environmentally friendly because it greatly reduces the amount of sulfur and nitrogen than conventional blast furnaces do. The two sides also agreed to cooperate in cold-rolled steel plating and the development of mineral mines.
LG Chem, the world's largest manufacturer of the batteries used in electric vehicles (EV), signed an investment pact with Chinese authorities to build a new factory in Nanjing, giving it an advantage in the expected boom in EVs in China and around the world.
Besides these agreements, SK Telecom and SKC inked deals with Chinese companies to increase business tie-ups.
SK Telecom, South Korea's No. 1 wireless service provider, reached a strategic partnership with Zhengwe Group that centers on information, communication and telecommunication. The MOU between SKC and TCL explores ways to work together in the parts and service sector for upper-end LCD TVs and smartphones.