Tuesday, December 7, 2010
South Korea and U.S. Reach Deal on Trade
The US and South Korea reached a free trade agreement which will eliminate most tariffs for US exports and help solidify the relationship between the two countries. This is the largest free trade agreement that the US has established since NAFTA. This deal is expected to usher in 10 billion dollars worth of revenue to the US and create "tens of thousands" of jobs. US negotiators had failed to reach this deal just three weeks earlier but after the recent friction with North korea, South Korea seemed eager to close the deal. This deal was lauded by both the republicans and democrats and even the US chamber of commerce which hailed it as a great victory for US exports. Even earlier dissenters such as the Ford motor Company have thrown their support behind the agreement. This agreement is going to positively affect the struggling auto industry as Korea is a large importer of US autos.
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Although the agreement has been reached between the negotiating governments, both U.S and Korea will need to get the agreement approved by its respective senates.
ReplyDeleteAnother thing to be noticed is that although Korea is a large importer of US autos, the reverse could be possible as Korean cars (Kia, Hyundai) and electronics (LG, Samsung) are cheaper compared to its counterparts and its popularity has been rising in the U.S consumer market.