This study analyzes how and to what extent South Korea has embedded developmental liberalism into its FTA initiative, departing from its traditional focus on developmental mercantilism. In the wake of the global economic crisis of 2008-10 and the subsequent expansion of government interventionism across the world, the developmental state model has attracted renewed scholarly attention. The developmental state approach offers a useful conceptual framework to examine how a particular set of arrangements between the tradable and non-tradable sectors in South Korea has shifted from "developmental mercantilism" to "developmental liberalism." The significance of South Korea's FTA initiative is three-fold. First, it constitutes a notable policy shift to liberalism, departing from a mercantilist approach with a policy mix of import protection and export promotion. Second, the embrace of FTAs has been shaped by a top-down political initiative rather than a bottom-up demand from business groups and the general public. And third, despite its liberal but state-centric nature, South Korea's FTAs are closely embedded in the country's social fabric, both competitive and uncompetitive.