The free trade accord, signed in October last year and ratified by lawmakers, is the most ambitious deal that South Korea has ever finalized, and is the first of its kind between an East Asian country and the EU.
The EU is the second-largest trading partner for South Korea after China and buys around 20 per cent of Korean exports annually. Last year, trade between the 27-member economic bloc and South Korea totaled USD 92.2 billion, up around 17 per cent from 2009. South Korea's exports to the eurozone reached USD 53.5 billion last year, with Asia's fourth-largest economy reporting a trade surplus of USD14.8 billion.
Experts say that the free trade deal will pave the way for South Korean companies to tap deeper into the world's single largest economic bloc with a population of 500 million people and a gross domestic product of USd 16.3 trillion as of 2010.
"On the back of the free trade deal, the trade surplus from relatively competitive sectors will increase, and our economy will be upgraded," said Choe Nak-kyun, a researcher at the Korea Institute for International Economic Policy (KIEP).
Overall, the deal is expected to boost bilateral trade between South Korea and the EU by as much as 20 percent in the long term, according to earlier estimates by the KIEP.
The KIEP said the free trade accord with the EU would help boost South Korea's exports by USD 11 billion and its economic growth by 5.6 per cent while creating up to 253,000 jobs over the long haul.
"The FTA with the EU will boost bilateral investment and trade, and help solidify a strategic partnership as well," Seoul's trade ministry said earlier.
"Also, the free trade deal will improve the South Korean economy's transparency and credibility, and boost our economy's productivity and economic growth," it said.
In a ceremony to mark the implementation of the free trade accord, South Korean Trade Minister Kim Jong-hoon said the Korea-EU free trade deal will boost the flow of goods, investment and ideas for both sides.
"The free trade deal will bring South Korea and the EU closer than before and contribute to prosperity in both economies," Kim said.
Under the deal, Seoul and Brussels would eliminate or phase out tariffs on 96 per cent of EU goods and 99 per cent of South Korean goods within three years after the accord takes effect. They have also agreed to abolish tariffs on most industrial goods within five years of the deal taking effect.