South Korea and China have signed a bilateral free trade agreement. South Korea feels this would boost the country's clothing exports if China opens its clothing market at zero duty. China is South Korea's biggest export market, accounting for 26 per cent of its exports and around 11 per cent of GDP. Given that scale, an acceleration in export growth to China could deliver a large boost to South Korea's economy.

But in case Korea offers zero duty to Chinese apparel, the impact would not be very significant since an existing Korea-Asean free trade agreement already grants zero duties to apparel imports from Southeast Asia. Chinese import duties for South Korean apparel currently average 15.9 per cent.

The agreement should be effective in 2015. It will remove or reduce barriers of trade and investment between the two countries. The pact, which had been negotiated for more than two years, covers 17 areas including online commerce and government purchasing. China is the world's largest exporter and South Korea is ranked seventh.

While South Korea is expected to benefit the most from the deal, tariff reductions will only be in phases, with some tariffs on exports set to be lifted only in 20 years’ time. So prospects for Korea's exports will depend far more heavily on the performance of its main trading partners.