Tag: free trade

I would not be surprised that the price for South Korea to get President Trump on board with a possible 2nd Kim-Trump Summit was to agree to change the US-ROK FTA.  Usually when it comes to changes in the FTA there is a lot of pushback from the ROK where this went pretty smooth:

South Korean President Moon Jae-in and U.S. President Donald Trump welcomed the conclusion of negotiations to amend the countries’ bilateral free trade agreement (FTA) on Monday, vowing efforts to implement it swiftly.

“We, the Presidents of the Republic of Korea and the United States of America, hereby reaffirm our close alliance and the importance of maintaining strong, mutually beneficial trade and economic ties between our peoples,” the leaders said in a joint statement issued at the end of their bilateral summit in New York.

“We welcome the successful conclusion of negotiations between our governments that have resulted in amendments and modifications to improve the Korea-United States Free Trade Agreement,” they added.

Under the revised FTA, the U.S. will extend a 25 percent tariff on imports of South Korean pickup trucks by 20 years to 2041, while Seoul will double the number of U.S. cars not subject to its local industry regulations to 50,000.

“South Korea will double the number of American cars sold …(to) 50,000 per manufacturer of cars,” Trump said in a joint press conference.

The changes, which come at a U.S. request, were approved by the South Korean Cabinet last week. The revised FTA was signed Monday by the countries’ trade ministers. It still needs to be ratified by the countries’ legislatures.  [Korea Times]

You can read more at the link.

It looks like the Trump administration will at some point demand a renegotiation of the US-ROK FTA:

The U.S. Trade Representative said Wednesday the free trade agreement with South Korea resulted in a “dramatic increase in our trade deficit,” stressing it’s time for a major review of how the U.S. approaches trade deals.

“The largest trade deal implemented during the Obama administration — our free trade agreement with South Korea — has coincided with a dramatic increase in our trade deficit with that country,” USTR said in President Donald Trump’s 2017 Trade Policy Agenda.

Compared with before the deal went into effect in 2012, the total value of U.S. goods exported to South Korea fell by $1.2 billion, while U.S. imports of goods from South Korea grew by more than $13 billion, USTR said.

“As a result, our trade deficit in goods with South Korea more than doubled,” it said. “Needless to say, this is not the outcome the American people expected from that agreement. Plainly, the time has come for a major review of how we approach trade agreements.”  [Korea Times]

I think what would be interesting to see is a report on any artificial barriers making it difficult for US companies to compete in South Korea which may contribute to the trade deficit.

Republican Presidential candidate Donald Trump has taken another swipe at South Korea:

U.S. Republican presidential nominee Donald Trump denounced the free trade pact with South Korea as a “job killing” deal Thursday, pledging to totally renegotiate what he called “horrible” trade agreements.

It was not the first time Trump has voiced criticism of the Korea-U.S. trade agreement, but Thursday’s remark carried greater weight as it came in his first speech since formally winning the nomination at the national convention under way in Cleveland.

In a nationally televised nomination acceptance speech, Trump criticized his Democratic rival Hillary Clinton for supporting many trade deals hurting the American middle class, including the North American Free Trade Agreement (NAFTA), and for supporting China’s entrance into the World Trade Organization.

“She supported the job-killing trade deal with South Korea. She has supported the Trans-Pacific Partnership. The TPP will not only destroy our manufacturing, but it will make America subject to the rulings of foreign governments,” Trump said. [Korea Times]

You can read more at the link, but considering how the Korean left was against the US-ROK FTA does this mean that the Korean left are fans of Donald Trump? Now that would be an odd pairing.

Is it time to scrap the KORUS FTA?  US Presidential candidate Donald Trump thinks so, but the ROK finance minister disagrees:

Finance Minister Yoo Il-ho refuted remarks by U.S. Republican presidential candidate Donald Trump that the free trade agreement between Korea and the United States (KORUS FTA) undermines the American economy.

Minister Yoo made his remarks a day after Trump lambasted the KORUS FTA as “a job-killing deal” and said the deal “doubles our trade deficit with Korea and will destroy nearly 100,000 American jobs.”

Yoo also said joining the Trans Pacific Partnership (TPP) is “very important” for countries in the Pacific region, a stance in stark contrast with Trump’s pledge that he will pull the U.S. out of the 12-nation body if he is elected.

“That will not help any people in the world,” Yoo said during an American Chamber of Commerce in Korea (AMCHAM Korea) General Membership Meeting.

Yoo said that Seoul acknowledges that some criticize the KORUS FTA citing the increased U.S. current account deficit, but stressed that the deal’s advantages “easily outweigh” the disadvantages.

“Trump’s remarks show that he does not understand the KORUS FTA,” Yoo said. “The sales of American automobiles in Korea soared by 28 percent annually, which makes Korea the second largest market for U.S. carmakers,” he said, adding that Samsung Electronics and Lotte Chemical have invested some $15 billion and $3 billion in the U.S., respectively.

Over Trump’s remarks, widely translated as protectionist, Yoo urged that the deal ― which marks its fourth anniversary this year ― should be consolidated further. [Korea Times]

You can read more at the link.