Finance minister to press Mnuchin on tariffsKim Dong-yeon, Korea’s finance minister, sent a letter to U.S. Treasury Secretary Steve Mnuchin requesting the Trump administration exempt Korea from sweeping steel and aluminum tariffs, the ministry said Sunday.
Kim expressed concerns about the U.S. government’s decision to impose 25 percent tariffs on all imported steel based on the premise of national security. The letter contained a request to exclude Korea from the broad tariffs, considering the close cooperative relationship between the two countries.
In his letter, the finance minister stressed that Korean steel and automotive companies have contributed largely to job creation in the United States through their investments. Levying tariffs, the minister said, could have a negative impact on bilateral relations.
Kim plans to meet personally with Mnuchin to discuss the tariffs during the G-20 finance ministers’ meeting scheduled to take place from March 19 in Buenos Aires.
Over the weekend, Australia became the third country excluded from the Trump administration’s latest tariffs, raising the possibility that other countries could join the list.
In a Twitter post Friday, Trump said Australia would be exempt from the higher steel and aluminum tariffs since it is a U.S. security ally. The president said he spoke with Prime Minister Malcolm Turnbull on Australia’s commitment to a “fair and reciprocal military and trade relationship.”
Canada and Mexico were exempt because of ongoing Nafta negotiations.
“We will do our best to get Korea recognized as one of the countries to be exempted from the tariffs by March 23,” when the tariffs go into effect, Kim Hyun-chong, Korea’s trade minister, said in Washington on Thursday after Trump signed them into order. “If not, we will work on getting [the U.S. Commerce Department] to exempt some of the products.”
There are doubts about whether Korea could get the same treatment as Australia, especially since Korea along with Germany and Japan have largely benefited from what Trump calls “unfair trade” practices that have hurt the American economy.
Industry experts say the steel tariffs are a political rather than economic decision, especially since Canada and Mexico, which rank among the top five steel exporters to the United States - Canada in first, Mexico in fourth - were crossed off the list from the start.
“Among the steel exported from Canada, 99 percent goes to the United States, and 80 percent of steel from Mexico goes to the U.S., which shows that undoubtedly Canada and Mexico have a huge influence on the American steel industry,” said Park Jong-kook, an analyst at Kiwoom Securities. “The fact that Canada and Mexico were excluded waters down the United States’ justification of protecting its own steel industry.”
Korea ranks third among exporters of steel to the United States, but the Trump administration is more concerned that Korea is a major contributor to the Chinese steel industry.
According to the U.S. Commerce Department, Korea is the No. 1 country importing Chinese steel, a total of 14.2 million tons in 2016.
However, the Korean government has been cutting back. Chinese steel used in Korean products exported to the United States accounted for 2.4 percent in 2016, compared to 5.8 percent in 2014.
BY LEE HO-JEONG [email@example.com]
More in Economy
Tapped out and hunkered down, Korea stares recession in the face
Property owners get big tax shock
Household debt keeps climbing despite gov't efforts
Career interruptions due to marriage and childbirth down 11 percent
Despite vaccine shot in the arm, credit risk remains in markets