The Trump administration started negotiations last week on amendments and modifications to the U.S.-Korea Free Trade Agreement (KORUS FTA) with South Korea.
At the direction of President Donald J. Trump, U.S. Trade Representative Robert Lighthizer initiated talks last July to consider matters affecting the operation of the KORUS FTA, including amendments and modifications to resolve several problems regarding market access in Korea for U.S. exports.
The KORUS FTA was signed in June 2007 and approved by the U.S. Congress and South Korean government in 2011.
The U.S. business and agriculture community have received reports that the administration is concerned about the agreement, due to the imbalance of trade figures. These figures, however, are based on macroeconomic issues and not the trade agreement.
The California Chamber of Commerce reaffirmed support for the trade agreement in a letter sent on September 5, 2017 to members of the Trump administration, including the secretary of commerce and the U.S. trade representative.
Defending the KORUS FTA is a priority issue for the CalChamber and businesses across the country. The U.S. business community views the KORUS FTA as a strong agreement, and urges the administration to focus on more effective enforcement to solve issues as Korea’s economy improves.
The provisions of the trade agreement have been beneficial for U.S. industries, agricultural enterprises, farmers, ranchers, energy companies and automakers. Any renegotiation of the KORUS FTA must recognize the gains achieved, and ensure that U.S. trade with South Korea remains strong and without interruption.
The CalChamber now urges a quick and efficient process that does not hinder ongoing trade and investment between the United States and South Korea, who must be kept united in the same end-goal of a successful renegotiation.
The KORUS FTA sends a strong signal that the United States intends to remain heavily engaged in the region for a long time to come in business, economics, security and international politics.
The trade agreement strengthens the 65-year-old alliance between the United States and South Korea, while reinforcing the economic and political reforms South Korea continues to make.
Korea is a significant market for U.S. small and medium-sized companies, which make up a majority of U.S. businesses exporting to Korea. Korea is a $1.37 trillion economy and its commercial relationship with the United States is largely complementary. In 2016, two-way trade between the two countries exceeded $112.2 billion. In 2016, U.S. goods exports to Korea were $42.26 billion.
Korea is California’s seventh largest export destination. California is the top exporting state to Korea, making up nearly 20% of U.S. exports. In 2016, California exported more than $8.2 billion to Korea. Top products from California to Korea included nonelectrical machinery, computers and electronics, transportation equipment, and food manufactures.
Korea currently enjoys broad access to the U.S. market and the United States is one of Korea’s larger exporting markets, importing 12.3% of Korea’s worldwide exported goods, according to the CIA World Factbook.
For more information, visit advocacy.calchamber.com/south-korea.