Trump Says He's Looking Into South Korea Trade Accord Future

Geneva Matthews
September 4, 2017

U.S. President Donald Trump admitted that his administration was considering nullifying the five-year bilateral free trade agreement with Korea. -South Korea free-trade agreement with his advisers following a newspaper report that he's considering terminating the pact.

"It's very much on my mind", the president said of the trade deal, according to a press pool report, adding that he is discussing the matter with his advisers.

Trump made his remarks to reporters while visiting hurricane-hit Houston a day after he spoke with South Korean President Moon Jae-in and struck a deal allowing Seoul access to longer-range missiles as well as a potential arms sale.

Chamber officials, in their memo to members, said they "and others in the US business and agriculture community have received multiple reports that the administration is prepared to send a letter to the South Korean government on Tuesday, September 5 - or possibly sooner - indicating its intent to withdraw from the bilateral trade agreement".

The free trade question comes at a sensitive time diplomatically, with the United States and South Korea working in tandem to counter aggression from North Korea through its development and testing of nuclear weapons and long-range missiles.

The news was first reported Friday night by Inside U.S. Trade and then reported earlier Saturday by the Wall Street Journal and Washington Post.

"It's very much on my mind", the USA president said. However, a White House spokeswoman told the Post that discussions are ongoing, but there is nothing to be announced at this time.

The U.S. -Korea Free Trade Agreement was hammered out by Democrat Barack Obama and has been a frequent target for Trump, who calls it an unequal deal that gives South Korea a almost $28-billion dollar trade surplus.

The Korea Ministry of Trade, Industry and Energy on Sunday said it is preparing for all possibilities and monitoring the situation closely.

Neither the White House or the Office of U.S. Trade Representative confirmed or denied the possible move.

In recent days, a frustrated Mr Trump has pushed his staff to take bold action against a host of governments, including the one in Seoul, that he has accused of unfair trade practices. Trump used a similar threat to Canada and Mexico to force those nations to begin renegotiating the North American Free Trade Agreement, or NAFTA.

While Seoul and Washington are gesturing at a joint effort to stop the escalating nuclear threats by North Korea, experts speculated that the United States is now more likely to pull out of the bilateral deal as President Trump took to Twitter to accuse Seoul of being soft on Pyongyang.

The National Association of Manufacturers also sent out an e-mail to its members to weigh in on the issue with "senior administration officials" as well as members of congress and governors, citing that a notice of intent to withdraw from the trade deal has been drafted. The American Chamber of Commerce and Industry warned the termination of the trade deal with South Korea could wreck the White House relationship with the industry and farming sector. South Korea has been accused of dumping and subsidizing steel products. Korea is the U.S.' sixth-largest trading partner with volume totaling US$112.2 billion a year ago. The US had a US$17.6 billion (S$23.9 billion) trade gap with South Korea past year, compared with US$7.7 billion in 2012.

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