Suffering Trade Protectionism
The Federation of Korean Industries recently conducted a survey with 15 industrial associations and announced on August 10 that two-thirds of them answered they are being directly or indirectly affected by trade protectionism these days.
Specifically, the 10 sectors are steel, automobile, electronics, display, petrochemical, precision chemical, chemical fiber, cosmetics, tire and food. Associations representing the other five – semiconductor, machinery, construction, shipbuilding and petroleum – answered that they have suffered no significant damage yet.
The latest trend of global trade can be defined by blatant import regulations by advanced economies such as the United States, China’s non-tariff barriers to get even with the U.S. for the deployment of the THAAD system in the Korean Peninsula and industrial protectionism on the part of emerging economies, all of which are occurring at the same time.
Recently, the U.S. government imposed tariffs of 50% to 60% on South Korean steelmakers such as POSCO and Hyundai Steel. Last month, it levied preliminary tariffs of up to 110% or so on Samsung and LG washing machines manufactured in China. The Chinese government, in the meantime, is going to limit the number of brands that can be exported to China by a single foreign infant formula manufacturer to three from October and apply stricter quality control requirements to cosmetics suppliers from December. India, which is concentrating on the growth of its chemical fiber industry, initiated an anti-dumping investigation on Hyosung’s Spandex exports in January this year.