FTA Fulfilment
The U.S. government has stated that the KORUS FTA is a win-win deal for South Korea and the United States alike. Still, some conflicting interests do exist when it comes to specific trade issues.
Back in 2012, when the KORUS FTA became effective, South Korea recorded a trade surplus of US$15.2 billion vis-à-vis the U.S. Since then, the amount has increased and reached US$25.8 billion last year. During the period, South Korea’s exports to the U.S. jumped from US$58.5 billion to US$69.8 billion whereas its imports from the U.S. edged up from US$43.3 billion to US$44 billion.
These days, trade protectionists in the U.S. Congress are targeting countries recording large trade surpluses against the U.S. In April this year, the Department of the Treasury included South Korea, China, Japan, Germany and Taiwan in the monitoring list in its foreign exchange report submitted to the Congress.
It is expected that the U.S. will continue to put pressure on South Korea in a roundabout way with regard to the huge trade surplus while calling for the South Korean government to open up domestic markets for a complete fulfillment of the KORUS FTA.
Details regarding this can be found in the letter Senate Finance Committee Chairman Orrin Hatch sent three months ago to South Korean Ambassador to the United States Ahn Ho-Young. In the letter, the chairman of the Senate Finance Committee asserted that South Korea’s KORUS FTA fulfillment was still slow in five fields related to drug price determination processes, the transparency of the Fair Trade Commission’s investigations, legal service market opening, government agencies’ use of pirated software and rules on providing foreign entities with personal financial information for business purposes.