[Herald Interview] US envoy says 10-year-old KORUS FTA is foundation for a new trade platform
US envoy says 10-year-old KORUS FTA is foundation for a new trade platformAMCHAM
Korea chairman sees greater business opportunities from chip industry, stresses
importance of securing supply chain together By Hong Yoo, The Korea Herald - The
Korea-US Free Trade Agreement (KORUS FTA) will play a crucial role in taking
bilateral trade ties to a new level through a new trade platform designed to
tackle challenges stemming from a rapidly changing market environment, a senior
US envoy in Seoul said. The KORUS FTA, which marked its 10th year this month,
has been the most comprehensive and high-standard trade agreement in the
KORUS represents a turning point in the US-Korea relationship building from our
initial security alliance, a rock-solid security alliance for over 70 years,”
said Andrew Herrup, the US Embassy’s acting deputy chief of mission during a
joint The Korea Herald interview with the American Chamber of Commerce (AMCHAM)
said that the Korea-US trade relationship is broader now, and moving toward
trade investment. The two countries are now “looking to move even further to
collaborate on building out a set of norms and values that we will share in the
region and more broadly,” Herrup said.
the free trade agreement took effect in March 2012, the value of the US’ goods
and services exports to Korea has grown by over 17 percent to nearly $70
billion, according to the Ministry of Trade, Industry and Energy. Exports to
the US from Korea surged 70.6 percent to $95.9 billion last year.
Chairman and CEO James Kim cited over a 600 percent increase in the number of
US cars imported to South Korea as a key example of this growing trade
relationship. He also noted the growing popularity of US-imported beef.
“American beef is now the number one import here in South Korea,” he added.
for South Korea, cars and auto parts accounted for the largest volume of its
exports to the US, and has shown 75.5 percent growth from 11 years ago. US beef
exports to Korea increased by 249 percent since 2011.
the rapidly changing trade environment, the 10-year-old agreement now faces the
need for a change to bolster mutual interests, they said. This could be done by
forging a new set of partnerships on a new trade platform, the US-led
Indo-Pacific Economic Framework.
(Biden-Harris) administration is looking at a worker-centered, worker-focused
trade policy and building off KORUS, moving into IPEF. That’s where we will be
heading for the next several years,” said Herrup.
widely known as the US effort to bolster the US-Asia relationship to counter
China’s growing economic influence in the region, however, has also raised
concerns that it could be a risk for South Korea to choose sides between the
two economic superpowers. Diffusing
such worries, Herrup stressed that the IPEF is not targeted at a country, but
rather aims to spread transparency, good governance and market systems in the
will be looking at a variety of things: trade, supply chains, anti-corruption
and tax, cleaner energy and decarbonization of industry. Mixed in with all of
these four pillars is the nature of economic security,” Herrup said.
concerns over growing risks of supply disruptions, the US envoy said he sees
the problem closely tied to the lingering impact of COVID-19, not the Ukraine
initial reason why it’s such a big issue right now is the pandemic. The
pandemic caused disruptions in supply chains, and that wasn’t caused by the
action of any one nation. So putting aside causes for wider supply chain
disruptions, we need to make sure that our two countries, as well as our
partners, have access to the critical minerals we need and the supplies that
are needed for these critical supply chains that are the basis of our economies
now,” said Herrup.
the course of progressing bilateral ties, AMCHAM Chairman James Kim said he
sees a lot of business opportunities from the semiconductor industry. That is
why securing the supply chain of chips together has grown far more important,
that South Korean companies poured $64 billion worth of foreign direct
investment in the US in 2020 alone, Kim said, “That shows you that Korea loves
America. America is a great market for Korean companies, and that’s just one
side from the other side around.”
Korea represents a huge base for things that require semiconductors, and three
of our most important member companies using the semiconductor business --
Qualcomm, Applied Materials, and Lam Research -- are here in Korea. They want
to make big investments in Korea because they realize they create a very
important market,” he said. Lam Research, a semiconductor equipment
manufacturer, is set to open its research and development center in Yongin,
Gyeonggi Province, on April 26.
the country awaits the start of the incoming Yoon Suk-yeol administration in
May, both AMCHAM and the US Embassy said they would continue to closely work
with the new government to further economic bilateral cooperation.
about his previous meeting with the president-elect before the presidential
election, Kim believes that Yoon will be a close friend to the US.
spoke about things like taxes, deregulation and really helping to make Korea a
regional headquarters for multinational companies, which many US companies are
already trying to do more of. So I look at him as someone who’s going to be
very pro-business, very close to America,” said Kim.
arrived in Seoul in August last year following two years in Washington as
deputy director for the Office of Southern African Affairs. Prior to that, from
2016 to 2019, he served as the deputy chief of mission at the US Embassy in
has led AMCHAM Korea since 2014, and previously served as CEO of GM Korea.