France slams 'unfair competition' by Korean carmakers
(PARIS) - France's industry minister on Wednesday slammed what he called "acts of unfair competition" by carmakers from South Korea, who have boosted their market share in Europe following a 2010 free trade deal.
Within the framework of this deal, "we are justified in demanding monitoring measures which may enable us to request a safeguard clause," Minister for Industrial Renewal Arnaud Montebourg told reporters.
The European Union and South Korea signed the free trade deal in October 2010 and the agreement, the first such deal linking Asia and the world's largest economic bloc, will eventually do away with 98.7 percent of duties.
EU states insisted during negotiations on a "safeguard" clause to protect the industries from "sudden surges of imports" in sensitive sectors, including small cars, by allowing a return to some tariffs.
French carmakers PSA Peugeot Citroen and Renault are facing increasing competition from Korean automakers including Hyundai and Kia. Hyundai's sales grew 12 percent last year in Europe while Kia's sales jumped 11 percent.
Montebourg made the comments as the French government presented a rescue plan for the country's struggling auto industry, whose plight was highlighted by Peugeot's results Wednesday showing a first half net loss of 819 million euros ($989 million).
The European Union is negotiating a similar free trade pact with Japan, which has also raised concerns in the auto industry.