Korea’s Free Trade Agreement with five Central American countries recently entered into force, creating substantial expectation that the Agreement would help both Parties facilitate and expand trade and investment, and thereby strengthening bilateral economic partnership. The Agreement has a comprehensive coverage from goods trade to services liberalization and investment to intellectual property rights, and even includes access to government procurement markets and a wide range of cooperation priorities. Especially, its conclusion drew substantial attentions because the Agreement marks fourth of its kind for Korea to create a free trade network with Parties from Latin American, next to Chile, Peru, and Colombia, among the 16 FTAs that the country has concluded.
   Against the backdrop, this study explores Korea-Central America FTA’s trade and investment implications. Especially, it analyzes prospective products and sectors in which bilateral trade and investment opportunities would increase, and suggests that Korean exporters and policymakers have to make stronger and continued efforts to realize the potential benefits accruing from the Agreement in those analyzed sectors and areas.
   To this end, the study is composed of three main analyses that incorporate implications for trade in goods, trade in services, and investment, respectively. Since the five Central American parties of the FTA, i.e. Costa Rica, El Salvadore, Honduras, Nicaragua, and Panama, act individually, not collectively as a group or a customs union, the study includes a separate analysis for each of them.
   Chapter 2 examines recent trade and industrial developments and trends of the Central American parties. It also discusses their trade and FTA policies, including implementation of special economic zone or free trade zones. Major findings suggest that the Central American parties generally pursue trade liberalization, and have already concluded FTAs with various partners like US, EU, Mexico, Chile and other countries in the Latin American region as well as Taiwan, Singapore and China in Asia. Also, they show that some of the Parties - specially, Costa Rica and Panama – actively sought to attract foreign investments and participate in regional values chains, through which they have fostered open and relatively conclusive environment for investments. Nevertheless, Korea’s trade with the Parties prior to the FTA was relatively small, compared with its trade in other parts of the globe, and was even increasingly pushed away in local markets by growing competition with other suppliers like China and Japan.
   Chapter 3 analyzes prospective products in which Korea’s trade with the Central American parties would increase. To identify most relevant variables that would positively affect post-FTA trade growth, the analysis first examines cases of Korea’s FTA with Chile, Peru and Colombia. As a result, it finds that size and growth rate of the import market, and Korea’s export competitiveness generally led to trade increase in intensive margin in those previous cases. In addition, it finds that level of competition also plays important role for FTA’s trade effect, especially for trade expansion in extensive margin. Based on the clarification of relevant variables, the analysis further suggests most likely and desirable export items to each Central American market.
   Chapter 4 analyzes prospective sectors in which Korea’s services trade with the Central American parties would increase. To this end, it examines recent trends of services trade in each parties, compares levels of service market liberalization before and after the FTA, and explains important government policies for major services market liberalization. Based on the analysis of overall conditions and policy directions in major services market, the study further suggests that Korea has relative competence in public services, construction, AI education, digital government and online distribution services, among others.
   Chapter 5 analyzes investment opportunities in the Central American parties. The study explores recent trends of foreign direct investment in the five countries and discusses business environment, overall business capacity and development of investment protection under trade agreements. The analysis also finds that Korea’s investment in the region has been substantially low, which is likely to remain unchanged in the near future. Nevertheless, the FTA can help create better investment conditions in the long term, and Korea’s recent build-ups for investment and value chain formation in other parts of Latin American can positively contribute to fostering its extended investment in the Central American region.
   Overall, this study provides statistical and regulatory information of the five Central American parties of the Korea-Central America FTA. It also provides a longer-term perspective that exporters and policy-makers can consider in utilizing and implementing the FTA that recently entered into force. 

국문요약

제1장 서론
1. 연구배경
2. 연구목적
3. 연구방법

제2장 중미 5개국의 무역과 산업
1. 중미 5개국의 무역과 경제 통합
2. 중미 5개국의 산업과 자유무역지대
3. 한·중미 5개국의 교역 현황
4. 소결: 중미시장 현황과 시사점

제3장 FTA를 통한 상품무역 확대방안
1. 한·중남미 FTA 기체결국 상품교역 분석
2. 한·중미 5개국 상품교역 분석
3. 소결

제4장 FTA를 통한 서비스무역 확대방안
1. 중미 5개국의 서비스무역 분석
2. 중미 5개국의 서비스무역 개방 분석
3. 한·중미 FTA의 서비스무역 개방 분석
4. 한국의 대중미 서비스무역 확대방안 분석
5. 소결

제5장 FTA를 통한 투자 확대방안
1. 중미 5개국 외국인직접투자 분석
2. 한국의 중남미투자 분석과 시사점
3. 한·중미 FTA 투자규범 분석
4. 소결

제6장 결론

참고문헌

Executive Summary