The United States and South Korea effectively agreed to renegotiate a five-year-old bilateral free trade agreement after US President Donald Trump’s administration blamed the deal for widening the US trade deficit.
The agreement was reached during talks in Washington between US Trade Representative Robert Lighthizer and South Korean trade minister Kim Hyun-chong, according to South Korea’s Ministry of Trade, Industry and Energy.
The two countries shared an understanding of the need to amend the free trade deal to further strengthen the mutual benefits, the ministry said in a statement.
Trump has repeatedly slammed the bilateral trade deal, calling it a “job killer” for the United States. Seoul had not been willing to renegotiate the agreement due to the benefits it says the deal has produced.
“I now look forward to intensified engagement with Korea in an expeditious manner to resolve outstanding implementation issues as well as to engage soon on amendments that will lead to fair, reciprocal trade,” Lighthizer said in a statement.
The US-South Korean free trade agreement, which went into force in March 2012, removed tariffs on over 90 per cent of the items traded between the two countries, including automobiles.
Since the trade agreement went into effect, the US goods trade deficit with South Korea more than doubled to US$27.6 billion last year. But through July 2017, the bilateral trade deficit fell to US$13.1 billion from US$18.8 billion during the same period of 2016, according to US Census Bureau data.
Lighthizer is also focused on revamping the North American Free Trade Agreement with Mexico and Canada.
Source: South China Morning Post