USA business group warns of scrapping South Korea trade deal


WSJ: Trump May Withdraw From South Korean Trade Pact

But the issue has dipped out of view since North Korea's nuclear test on Sunday.

The remarks by Robert Lighthizer, the USA trade representative, were the first public comments by a top policy maker about the trade agreement, known as Korus, since administration officials said over the weekend that President Donald Trump was seriously considering terminating the pact, and would discuss the matter with advisers this week.

"Now is the time to further solidify the US-Korea alliance", it added.

Vetter is calling the deal incredibly valuable for USA agriculture.

In a letter to the president, Ernst noted that South Korea has since become a top USA trade partner, with $144 billion in total goods and services transferred between the countries in 2016 alone.

Senior Republicans and USA businesses have pleaded with Trump to keep the FTA, which they described as a "win-win" deal for America, but Trump blew a gasket when South Korean trade officials declined to discuss revisions. It didn't work out that way. The statement by House Ways and Means Committee chairman Kevin Brady, senior Democrat Richard Neal, Senate Finance Committee chairman Orrin Hatch and senior Democrat Ron Wyden said talks to improve Seoul's implementation and compliance with the trade deal were welcome, but that the pact was central to the US-South Korean alliance.

Last year, the USA exported agricultural and livestock products worth a total of US$6.872 billion to South Korea to post a surplus of US$6.166 billion in these primary industry sectors alone.

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The past five years have seen steady growth in the USA, and Americans have been buying a lot of cars and electronics, the very products that South Korean companies make a lot of. During the same period, Hyundai Motor Company and Kia Motors increased their exports to the merely 21% and 13%, respectively.

At the same time, the South Korean economy has been relatively lackluster and people in the country have been importing less, Sohn noted.

Maschoff says exiting KORUS would cause the United States to lose market share to other countries. This agitates the Trump administration, although economists neither attach much significance to a bilateral trade deficit nor accept any strong link between deficits and trade policy.

More recently, he has said he might still withdraw from NAFTA, indicating he believes Mexico was not offering enough concessions in the re-negotiation session that occurred between the U.S., Canada and Mexico in Washington last month.

"South Korea remains one of the top five sources of yarn and fabric imports, used for domestic manufacturing operations", AAFA said. Without foreign trade, prices for a lot of agricultural products would fall, he said.

"In a negotiation [like the FTA] each side has [its own] strategies", Paik Un-gyu, minister of trade, industry and energy, said on Tuesday during a meeting with trade industry officials at the Korea International Trade Association headquarters in Seoul. By playing the withdrawal card, the Trump administration is attempting to kill two birds with one stone. The president said over the weekend that he was ready to begin the process of withdrawing from the pact, which may have been a ploy to extract bargaining concessions from South Korea. -South Korea relations amid tensions in the Korean Peninsula.

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