TAIPEI: The implementation of a free-trade agreement (FTA) between the United States and South Korea has imposed an adverse impact on Taiwan’s exports to the U.S. market, a research report released by the Ministry of Economic Affairs (MOEA) showed Tuesday.
The FTA between the U.S. and South Korea became effective on March 15, 2012.
According to the report, which was conducted by the Chung-Hua Institution for Economic Research (CIER) on behalf of the MOEA, Taiwan’s exports during the March 2014-February 2015 period fell 1.13 percent from the period of March 2011-Februry 2012.
However, South Korea’s exports to the U.S. market gained 23.44 percent during the three year period, the report showed.
During the same three year period, Taiwan’s share of the U.S. market fell 0.1 percentage points, while South Korea’s share increased by 0.48 percentage points, the report showed.
As of February 2015, the MOEA said, Taiwan ranked as the seventh largest exporter to the U.S., and although South Korea placed 10th, Seoul has benefited from the effects of the implementation of the FTA with Washington.
Among the top 10 exporters to the U.S., South Korea enjoyed the most significant growth in exports to Washington during the three year period after the implementation of the FTA, the ministry said.
Taiwan and South Korea have competed head-to-head in the global market since exports of the two countries have largely overlapped.
In terms of the market share in the U.S. during the three year period, Taiwan witnessed falling sales in a wide range of industries, such as electrical equipment, textiles, optoelectronics devices, musical instruments and toys, the MOEA cited the research report as showing.
In particular, the MOEA said, the local electrical equipment sector saw its market share fall 1.58 percentage points during the 3-year period, adding that the Washington-Seoul FTA has affected Taiwan’s competitive edge.
The FTA between Seoul and Washington aims to lower tariffs further on goods imported from South Korea over the next few years to zero, which could further erode Taiwan’s competitiveness, the MOEA said.
