SEOUL: The US trade relationship with South Korea is “falling short”, with the free-trade deal between the countries under review, Vice-President Mike Pence said on Tuesday.
“We’ll pursue trade that is both free and fair,” Pence said during remarks at a US business chamber gathering in Seoul. “And that’ll be true in all our trade relationships, including Korus,” he said, in a reference to the US-South Korea deal.
“We’re reviewing all our trade agreements across the world to ensure they benefit our economy as much as they benefit our trading partners,” Pence said. “We have to be honest about where our trade relationship is falling short. Most concerning is the fact that the United States trade deficit with South Korea has more than doubled since Korus has come into effect.”
Pence’s visit to North Asia – he now heads to Japan – was originally focused on economic and trade matters, though it has been overshadowed by tensions over North Korea’s nuclear weapons program. During his comments in Seoul he called the trade gap with South Korea a “hard truth”, with “too many” barriers to entry for US businesses.
Pence’s comments come just days after South Korea, the US’s sixth-largest trading partner, avoided being tagged a currency manipulator by the US Treasury, though it remains on a watch list of nations deemed at risk of engaging in unfair conduct. The US hasn’t named any country a manipulator since 1994.
South Korea’s trade surplus with the US was $US4.4 billion ($5.8 billion) in the first three months of this year, down from $US6.6 billion during the same period in 2016, according to Korea customs office data. For all of 2016, the surplus was $US23 billion, it said.
The countries can agree in writing to amend their trade deal, while terminating it would require six months’ notice.
South Korea argues that automobiles are a small fraction of total exports to America. The country sent 964,432 vehicles there in 2016, down 9.5 per cent from the previous year, according to the Korea Automobile Manufacturers Association. Imports of US cars rose 22 per cent to 60,099 units, it said.
