U.S. Supply Chain Policy Offers an Opportunity for Korean Economy
The Korea Economic Research Institute said in its report on June 16 that the United States’ supply chain reinforcement policy can be an opportunity for the South Korean economy.
“The essence of the U.S.-China trade disputes that resulted in the policy is hegemonic competition, the competition will lead to the formation of an economic bloc led by the United States, and the bloc of the United States and its allies is likely to overpower multilateral FTAs for the time being,” it explained, adding, “It is in this regard that the United States is proposing the formation of a presidential forum for global supply chain reinforcement and not joining the U.S.-led global economic order will cause huge losses on the part of South Korea with the GDP of the United States and its 50 or so allies amounting to 65.8 percent of the global total GDP.”
“The United States will keep China in check by working with its allies rather than utilizing multilateral FTAs,” it went on to say, continuing, “Given that China still makes up large parts of the major industrial supply chains of the United States and is unlikely to be completely ruled out in the near future, South Korea also needs to gradually reduce its dependence on trade with China.”
The institute also pointed out the necessity of more cooperation with the United States for more support from it as well as more corporate investment in the country. “The United States will increasingly block China with regard to the imports of advanced technology products in particular, and South Korea needs to make the most of this opportunity,” it said.