South Korea, US reach an understanding to revise steel tariffs agreement

South Korea’s Trade minister has revealed that the South Korea and the United States have reached an understanding to revise steel tariffs’ free trade agreement (FTA).

The announcement was made by Kim Hyun-chong, Seoul’s Trade minister, on his arrival at the Incheon International Airport after talks in Washington. Just last week US officials had said Friday an agreement could be announced in the coming week.

“Agreement on the bilateral FTA and steel issues has been reached in principle,” Hyun-chong said. Technical issues have been to worked out, but the in principle agreement has been reached to. Kim said Seoul was able to defend its “red line” on farm goods and no additional concessions were made over tariffs.

The agreement between the two countries has helped eliminated uncertainties related to steel and it should allow South Korean products to be shipped to the United States.

The Trump administration in July convened talks to renegotiate the free trade treaty, arguing the 2012 deal was lopsided because the US trade deficit had ballooned since it was signed.

President Donald Trump said Friday the two sides were “very close” to finalising the updated pact “and we’re going to have a wonderful deal with a wonderful ally.”

Commerce Secretary Wilbur Ross said Washington and Seoul were also near agreement on the steel and aluminium tariffs which Trump recently imposed.

South Korea is one of seven economies temporarily exempt from the duties that went into effect Friday and were mainly aimed at overproduction by China.

Despite fears of a tit-for-tat trade war that have sent global markets tumbling, Trump said many countries are now coming to the table to negotiate “fair” trade deals with the United States.

The US trade deficit with South Korea has declined since 2014, to USD 10.3 billion last year.