U.s.-Korea Free Trade Agreement 2018

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15 Office of the United States Trade Representative, Joint States Trade Representative Robert E. Lighthizer and Republic of Korea Minister for Trade Hyun Chong Kim, press release, March 28, 2018. Third, Korea has requested changes to the rules of origin for three categories of textile products that are not available in Korea or the United States and therefore must come from other countries.37 Because the current rules on textile products are not available in Korea or the United States. “forward thread” allows a textile product to be eligible for the lower tariffs of a free trade agreement only if it is made up of threads and fabrics from one of the parties to the free trade agreement. The United States supports specific rules in its trade agreements because it restricts intermediate consumption from other countries.38 The United States has agreed to expedite its process of verifying domestic and domestic availability and has expressed its willingness to change the rules of origin specific to textile and clothing products (Annex 4-A) if there is no commercial availability. This would be a positive development in terms of relaxing the strict rules on cutting-edge yarn, which hinder the most efficient methods of textile and clothing manufacturing. But the biggest factor in trade imbalance is car sales, and that`s what really bothers the Trump administration. In 2016, Americans imported $16 billion worth of Korean cars – about 10 times more than the $1.5 billion spent by South Koreans importing U.S. cars. Auto industry experts say the reason is quite simple: Americans love Hyundai and Kia cars much more than South Koreans like Chevys and Fords. The December 2010 agreement was a compromise between the two parties. Major concessions have been made to the United States in the auto trade: tariff reductions for Korean cars have been delayed by five years and American cars have benefited from wider access to the Korean market. At the same time, negotiators agreed to set aside for now the differences of opinion on U.S.

beef exports. 9 Steve Holland, “Trump Hints on Withdrawal from U.S.-South Korea Free Trade Deal,” Reuters, September 2, 2017. At this time, North Korea announced a successful test of a nuclear weapon that could be loaded onto a long-range missile that could have influenced the United States.

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