• International Commerce and Information Review
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• v.15 no.4
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• pp.171-192
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• 2013

The FTA utilization rate in Korea current, compared with the developed countries, utilization rate is low overall. In particular, in the case of Korea-ASEAN FTA, etc. remain at 30% level, improvement of FTA utilization has emerged as a matter of urgency. In addition, the proportion receiving the FTA preferential tariff trade companies have also been assessed as weak, improve the utilization ratio is in the policy issue of maximum. In this study, in order to increase the utilization of FTA trading enterprises, and analyzes were performed in reality. And to understand the FTA bottleneck matters of trade enterprises, and was also studied improvement plan consulting and education FTA utilization of trading partners. This has a purpose to provide data useful measures making to improve the utilization of FTA government. It is expected that the contribution of export expansion trade companies that take advantage of the FTA as a result of this study, enhancement of FTA policy, to strengthen the support base of FTA policy.

• Asia-Pacific Journal of Business
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• v.13 no.3
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• pp.475-491
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• 2022

Purpose - This study analyzed the correlation and effect of FTA environmental factors (company internal environmental factors, corporate external environmental factors) between FTA utilization and performance of Shandong companies in China. Design/methodology/approach - To test the hypothesis, SPSS 24.0 statistical packages were used based on the collected data. Findings - First, it was confirmed that internal environmental factors (international marketing orientation, corporate competitiveness, and corporate awareness of FTA) of companies had a positive(+) effect on FTA utilization. Second, The government's support for FTA utilization will have a significant positive (+) effect on companies' FTA utilization.Non-tariff barriers will have a negative (-) effect on companies' use of FTA. Third, A company's FTA utilization will have a significant positive effect on FTA performance. Research implications or Originality - If Shandong companies want to increase the utilization of FTAs, they should strengthen international marketing, such as collecting information on competitors and improving product quality and price competitiveness, and increase corporate competitiveness through active export activities to the global market.In order to increase the awareness of FTA among enterprises in Shandong Province, the government should strengthen the relevant education of enterprises about FTA.

• Journal of Korea Trade
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• v.27 no.3
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• pp.199-216
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• 2023

Purpose - This study aims to identify the internal capabilities that export companies need to possess in order to utilize FTAs and to propose ways to expand their export performance through them. To achieve this goal, the study analyzed the internal factors that affect FTA utilization from a resource-based perspective, such as Origin Management Competency, Information Acquisition Competency, contract Management Competency, and Commitment to Export, based on prior research on corporate capabilities in the field of management and FTA-related research. The study ultimately aims to confirm whether a company's FTA utilization contributes to its export performance through the management and response to its internal factors for FTA utilization. Design/methodology - To achieve the research objective, this study conducted a literature review related to FTA utilization and identified the internal factors of companies that affect FTA by classifying them into Origin Management Competency, Information Acquisition Competency, contract Management Competency, and Commitment to Export Based on this, a final research model was developed, hypotheses were set through a preliminary study survey, and conclusions were drawn by analyzing the data of 312 companies. Findings - The empirical analysis results indicate that Origin Management Competency and Contract Management Competency have a positive impact on FTA utilization, while Information Acquisition Competency and Commitment to Export do not have a statistically significant impact on FTA utilization. Based on these findings, this study suggests measures for efficient FTA utilization for companies that want to utilize FTAs. Additionally, FTA utilization has a positive impact on export performance. In other words, the extent to which companies utilize the signed agreements has a positive impact on their performance. Based on these results, this study identifies the characteristics of companies that want to utilize FTAs and proposes measures for future efficient FTA utilization. Originality/value - This study has confirmed that in order for companies to utilize FTAs, they must meet the requirements of the FTA. To this end, the study has concluded that it is important to manage and address internal factors such as Origin Management Competency, Information Acquisition Competency, contract Management Competency, and Commitment to Export to increase FTA utilization. Based on these results, it can be confirmed that it is essential for companies to have an understanding and management of the internal factors that satisfy the requirements of the FTA in order to utilize the FTA.

• Journal of Korea Trade
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• v.23 no.4
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• pp.80-102
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• 2019

Purpose - This paper aims to articulate relationship about factors influencing FTA utilization by dividing them into company's external and internal factors and performing investigation on the relationship between FTA utilization and export performance. Design/methodology - This study verified factors influencing FTA utilization by dividing them into company's external and internal factors and performing investigation on the relationship between FTA utilization and export performance. Empirical analysis was performed by setting internal and external factors required for FTA utilization as variables. To achieve this, research model was established based on previous study, hypothesis was deduced, and statistical program were used to test the hypothesis. This study performed empirical analysis using statistical program of SPSS 18.0 and AMOS 18.0 for the research model. Findings - Empirical analysis was performed regarding the effect of the FTA utilization on export performance and previous study defined export performance as the company's increased economy benefits through export and increase in new transactions. Analysis was also performed for factors affecting the FTA utilization by the company and through management and response of external factors and internal factors it was confirmed that the FTA utilization by the company led to increase in the company's export performance as a result. This study proposes a method to achieve export performance based on this. Originality/value - Companies seeking to utilize the FTA sign the Contract for the International Sale of goods and there are many conditions to meet in order to receive trade preferences during the transaction process. Existing trade order and order in the FTA have to be followed. Country of origin can be seen as key in the FTA. The Rule of Origin becomes the most important evaluation standard in applying preferential tariff in the FTA. Such regulations can be seen as external factors which cannot be controlled by the company. Internal factors are capabilities owned before that can be controlled by the company. The study sought to test the variables regarding factors centered on such capability. This study verified factors influencing FTA utilization by dividing them into company's external and internal factors and performing investigation on the relationship between FTA utilization and export performance.

• Journal of Korea Trade
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• v.23 no.4
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• pp.131-148
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• 2019

Purpose - Based on the Korea-China FTA as the starting point, this paper makes an empirical analysis of the main influencing factors of the FTA utilization and performance of SMEs. Design/methodology - Taking into account the relationship between the internal and external environmental factors on FTA activities and performance of Korea's SMEs, with PLS-SEM and data obtained by the questionnaire, Smart PLS was applied for the analysis. Findings - The recognition of FTA in SMEs has a significant positive effect on FTA utilization and performance, the international marketing orientation factor only has a significant positive effect on the performance, while the inadequate improvement of non-tariff barriers has a significant negative impact on FTA utilization. In addition, FTA activity has a significant mediation effect on two paths. Originality/value - This paper is of great practical relevance as a tool to enable SMEs to make effective utilization of Korea-China FTA and improve their imports and exports. The paper helps grasp the main factors affecting the utilization and performance of FTA for SMEs, also to establish FTA Business Model and FTA utilization plans for specific industries in the future regarding tariff and non-tariffs compatibility.

• East Asian Economic Review
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• v.26 no.3
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• pp.227-253
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• 2022

Despite the proliferation of free trade agreements (FTAs), many exporting firms are still confronted with several challenges in utilizing the FTA preferential tariffs. Based on the Technology-Organization-Environment (TOE) framework, this study empirically examines the factors affecting the utilization of FTA schemes by exporting firms. To clarify the key factors influencing FTA utilization, this study develops a conceptual model from the perspective of the adoption of information technology innovations. Eight factors derived from the TOE framework are proposed to explore the determinants of FTA utilization in export. Partial least squares structural equation modeling is employed to analyze the data collected from 162 exporting small- and medium-sized enterprises in the South Korean textile industry. The findings reveal that compatibility and trading partner influence are positively associated with FTA utilization, while complexity is negatively related. Factors of organizational context do not show any relationship with FTA utilization. This study is the first to theoretically analyze and empirically test the determinants of FTA utilization from the perspective of technological innovation adoptions. By examining the relative importance of TOE factors in the utilization of FTA schemes, this study expects to advance a holistic understanding on the perceived factors that could potentially affect the utilization of FTA schemes.

• Journal of Digital Convergence
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• v.14 no.12
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• pp.55-63
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• 2016

Recently, FTA may go beyond the agreement of the two countries, and also FTA is tinged aspects of Mega FTA between the economic sphere, under the situation that FTA and the business model are mutually intertwined in convergence industrial environments. Since South Korea came into force in 52 countries and 15 cases of FTA, South Korea have completed FTA network with the United States, as well as ASEAN and most of OECD member countries, and South Korea is now a critical time to take advantage of the FTA to determine the South Korea's economic performance. This paper examined the previous studies of FTA utilization and analyzed practical usages and problems of SMEs' FTA utilization. Through analysis, this paper suggests that the Training Plans of SMEs' Origin Management Specialist for the Improvement of FTA Utilization is as follows: to build up the effective management system of origin supports, to enrich the origin management competency, to reinforce the operation of supporting system, and to strengthen practical capacity of Origin administrative staff. Based on the results, it is expected to provide the policy implications for the FTA utilization in the future.

• Asia-Pacific Journal of Business
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• v.6 no.1
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• pp.59-82
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• 2015

According to the survey on the state of practical usage and present situation of FTAs, conducted among trade companies operating in Shandong province in 2014, more than 90% of companies are believed to be small and medium sized enterprises. Therefore this study tries to test what impact the awareness and utilization of an FTA have on its outcome among trade companies operating in Shandong province as well as partner countries and other trade companies. The research results are as follows. First, we found a positive correlation between 1) a company's global orientation (as measured in export density as a percentage of profit) and 2) its competitiveness (as measured in annual sales), and a company's degree of utilization of FTA provisions. Second, One of the findings is that the more aware of the (exporting) HS code, conventional tariffs and the process of issuing C/O the companies from Shandong province are the more they actually use (utilize) an FTA inpractice. Another interesting finding is that the more aware of the (exporting) HS code and conventional tariffs the enterprises are the higher is their practical usage level of an FTA. Third, however, at the time of this study's completion, FTA utilization was not yet positively correlated with statistically significant performance results. Therefore, to increase the utilization and performance of FTA, the China government have to make a efficient business models for each industry and support the small and mid-size businesses including Shandong province's SMEs.

• Korea Trade Review
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• v.44 no.3
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• pp.253-269
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• 2019

This study examines the utilization effect of FTA on the sales and profit of the secondary auto-part suppliers in two aspects: 1) firm-level survey on the utilization of FTA and 2) statistical inference on the FTA effects on their sales and profit. We use the GLS statistical technique, panel and survey data of 130 secondary auto-part suppliers in the Daegu and Kyungpook area in 2007-2016. The evidence shows that the secondary auto-part suppliers struggle to prepare documents for the FTA certificates of origin due to their small firm size, although they utilize the FTA at the relatively high rate of 92 percent. Statistical evidence shows that an increase in the export of the first vender significantly affects the sale of the secondary auto-part vendors, but not their profit. The low profit and high managing cost of utilizing the FTA deteriorate the utilization effect of the FTA of the secondary auto-part vendors, which is a key factor in a global supply chain and for the competitiveness of the automobile industry. Government policies are required for the secondary auto-part suppliers to utilize the FTA more effectively and share the benefits of tariff reduction with first auto-part vendors under FTA transaction.

• International Commerce and Information Review
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• v.16 no.3
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• pp.225-251
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• 2014

This study was intended to confirm a positive correlation between a understanding and utilization and performance results of the FTA in Gangwon-do. To this end, eighty-six companies(90% SMEs) which participate in both import and export were surveyed regarding their understanding and utilization of the FTA, and current performance was analyzed. The research results are as follows. First, we found a positive correlation between 1) a company's global orientation (as measured in export density as a percentage of profit) and 2) its competitiveness (as measured in annual sales), and a company's degree of utilization of FTA provisions. Second, we found that increased awareness of the provisions of Korea's FTAs was positively correlated with the degree to which companies were able to benefit financially from Korea's FTAs. Third, however, at the time of this study's completion, FTA utilization was not yet positively correlated with statistically significant performance results. Therefore, to increase the utilization and performance of FTA, the Korean government have to make a efficient business models for each industry and support the small and mid-size businesses including Gangwon province's SMEs.