The US and South Korea kicked off talks on possible changes to a five-year-old bilateral trade deal that President Donald Trump has called a “ job killer.”
South Korean trade minister Kim Hyun-chong spoke early Tuesday with US Trade Representative Robert Lighthizer via video-conference, and officials from both nations are continuing discussions in Seoul. Kim is set to hold a news conference at 5:30 p.m. local time on the Korus deal that he once described as a “slam dunk-shot” for the US.
In June, Trump told South Korean President Moon Jae-in that US automakers a should have a “fair shake” for better car sales.
In his inauguration speech in early August, Kim said that South Korea would pursue a “balance of interests” in any trade deal. “Negotiations that benefit one side only are simply not possible and can’t be maintained,” Kim said.
South Korea describes Korus as a mutually beneficial deal, basing its argument on a surge in bilateral trade volume. But the US sees it as one of the main reasons for the trade imbalance.
Trump’s push to revise the deal is part of his broader drive to reduce his nation’s trade deficits with various nations, such as his pursuit of a full renegotiation of the North American Free Trade Agreement. Countries such as Japan that have large trade surpluses with the US are watching on with interest.
The trade issue has emerged just as the US and South Korea need each other’s support to fight together against North Korea’s nuclear threat. Korus also helps the US on a strategic level as China’s economic and political influence grows in the region.
South Korea is the US’s seventh-largest trading partner, while the US is South Korea’s second-biggest partner after China. US figures indicate its goods deficit with South Korea was $27.7 billion last year, or about $4.4 billion more than the number Korea came up with.