Korea-U.S. FTA talks to focus on cars, steel tariffs

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Korea-U.S. FTA talks to focus on cars, steel tariffs

The third meeting to discuss changes to Korea’s bilateral free trade agreement with the United States will be held in Washington on Thursday.

According to the Ministry of Trade, Industry and Energy on Wednesday, Korea’s trade policy bureau director general, Yoo Myung-hee, will meet her U.S. counterpart, Assistant Trade Representative Michael Beeman.

The meeting comes at a time when Korea has been pressing the White House to exempt it from higher steel tariffs that President Donald Trump announced last week.

As of Wednesday only three countries have been exempted: Canada, Mexico and Australia.

Considering that the 25 percent tariffs go into effect on March 23, Seoul has slightly more than a week to persuade the White House.

Korean Trade Minister Kim Hyung-chong left for Washington on Tuesday hoping to convince top White House officials and senators of the need to exclude Korea from the 25 percent tariffs on imported steel.

Many analysts consider Trump’s inclusion of Korea a bargaining chip in the opening up of the Korean market to imported American cars, a key issue reportedly dealt with in the countries’ earlier meeting on the free trade agreement.

Trump didn’t hide the fact that he is using the steel tariffs as a bargaining chip in changes to the North American Free Trade Agreement (Nafta).

Talks on changes to that agreement finished their seventh round last week.

“I have a feeling we’re going to make a deal on Nafta,” Trump said when signing the tariff proclamation.

Analysts expect the U.S. delegation to press the Korean government to lower non-tariff barriers on U.S. automobiles, including environment regulations, during the meeting in Washington today.

The U.S. government has been trying to expand the United States’ share in the Korean market even though the number of U.S. automobiles imported to Korea surged 280 percent since the FTA went into effect in 2012 to $418 million in 2016, according to a report by the U.S. Trade Representative Office in March last year.

“U.S. exports of automobiles to Korea increased 20 times faster than U.S. automobile exports to the world over this same period.

“Korea is now the United States’ eighth largest export market by value, up from the 17th largest market in 2011,” the report noted.

BY LEE HO-JEONG [hojeong@joongang.co.kr]
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