In late 2017, President Trump directed the U.S. Trade Representative to begin consultation under the U.S. – Korea Free Trade Agreement. At that time, there was also some speculation that the United States might withdraw from the agreement. After just several negotiating rounds, the United States and the Republic of Korea reached an agreement in principle on the general terms of amendments and modifications to the U.S. – Korea Free Trade Agreement (KORUS FTA).
The negotiations were primarily focused on reducing the U.S. trade deficit with South Korea. Although Western Growers member commodities enjoy a trade surplus, Western Growers took this opportunity to request an accelerated reduction in the existing South Korean tariff schedule on our member commodities. However, it appears that tariff reductions were limited to industries, such as auto, that have a significant trade deficit. Although we did not directly benefit from any tariff reductions, the fact that the agreement will remain intact is beneficial for agriculture.
Despite some tariffs remaining in place for member commodities, South Korea remains a major market for the United States, exporting nearly $15 million in fresh vegetables, $491 million in fruit and $305 million in tree nuts. South Korea ranks as the 7th largest market for U.S. fresh vegetables, 3rd for fruit and 10th for tree nuts.
Before the amendments and modifications to the agreement become effective, there will be a 60 day period consultation with the U.S. Congress.