LG Energy Solution anticipates growing ties on 20th anniversary of Chile FTA

By Kim Joo-heon Posted : April 1, 2024, 17:40 Updated : April 1, 2024, 21:18
Courtesy of LG Energy Solution
[Courtesy of LG Energy Solution]

SEOUL, April 01 (AJU PRESS) - LG Energy Solution, the battery-making affiliate of South Korea's LG Group, is seeking to strengthen collaboration with Chile, which is integral to the firm's global battery supply chain. The battery maker highlighted Chile's pivotal role as a key partner in the lithium industry on the 20th anniversary of the free trade agreement that took effect on April 1, 2004, between Chile and South Korea. 

Since becoming South Korea's inaugural FTA partner, Chile has experienced a substantial surge in exports to South Korea. Data from the Korea International Trade Association (KITA) reveals that Chilean exports to South Korea, which amounted to $1.06 billion in 2003 before the FTA's implementation, surged past $4 billion in 2007. The export amount exceeded $7.5 billion in 2023, firmly establishing South Korea as Chile's fourth-largest export destination. South Korea's main import items from Chile include lithium and copper. 

"Chile ranks first in terms of lithium reserves and second in production in the world. It is our crucial partner as we strive to establish a global supply chain," LGES' global external affairs and ESG department head Chun Dong-wook said on Monday. "In March 2024, the Chilean government unveiled its plan to increase lithium production by 70 percent through expanding private sector participation in lithium salt development," he said, adding that LGES anticipates strengthened collaboration in the battery supply chain sector.  

"In July last year, we signed the world's largest lithium purchase agreement with Chile's SQM," Chun said. Under the contract, the Chilean supplier of lithium will supply 100,000 tons of lithium for seven years, which is enough to produce batteries for more than two million high-performance EVs.
This screenshot image was captured from the official Facebook page of the Chilean Embassy in Seoul
[This screenshot image was captured from the official Facebook page of the Chilean Embassy in Seoul]
Mathias Francke, the Chilean Ambassador to South Korea, has expressed satisfaction about growing economic ties between the two countries. The envoy highlighted the visits of five Chilean ministers to South Korea to attract more businesses to Chile's green hydrogen and lithium projects. Francke said: "We need to boost South Korea's investment in Chile, particularly in areas that are key for the economic security of both countries and their objective to become carbon-neutral."

Francke emphasized South Korea's position as Chile's 5th trading partner and expressed hope for an enhanced partnership. He expressed his willingness to cooperate with South Korea in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) if South Korea joins the Trans-Pacific partnership. The trade partnership currently involves 11 countries: Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, and Viet Nam.
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