EU/Korea Free Trading Agreement comes into force
Opportunities in the Korean market could encourage UK companies to make a business money transfer to the Asian nation.
The EU/Korea Free Trade Agreement has now come into force and will see tariffs on 97 per cent of all goods and services reduced.
Exporters keen to move into the Korean market are expected to benefit from the deal, while Korean companies may also find investing in the UK more attractive.
The deal, which is the first of its kind between the EU and an Asian market, is expected to result in savings worth £16 billion for European companies.
UK prime minister David Cameron said it marks a "significant development" in the UK's bilateral relationship with Korea.
"This agreement gives British business, large and small, an unparalleled opportunity to boost exports to one of Asia's fastest growing economies, and I hope that they will rise to the challenge," he remarked.
"Having attracted some £2.25 billion of Korean investment in 2010 - more than double that of any other European country - I hope that this agreement will result in even more Korean businesses choosing the UK as a platform to grow."
Business secretary Vince Cable said he has already met many British businesses who are successfully exporting to the Korean market.
"Korea is set to make the tenth largest contribution to world growth over the next five years, and will become one of the most attractive export destinations globally," he stated.
"British companies that are serious about growing their business internationally should seize the opportunities that have been created by the Free Trade Agreement."
Bilateral trade between Korea and the UK is worth around £10 billion a year. In 2010 the UK was the number three destination for Korean overseas investment.
More than 200 Korean firms are currently doing business in the UK, including Samsung and LG Electronics, and there are 15 listed on the London Stock Exchange.