U.S. Hopes for Korean Free-Trade Agreement by Summer
The Obama administration is working hard to have a free-trade agreement with South Korea signed, sealed and delivered by July.
U.S. Trade Representative Ron Kirk said Obama’s staff was pushing to have Congress approve the trade pact by July 1, the same day a rival free-trade agreement between South Korea and the European Union goes into effect.
The U.S. International Trade Commission in 2007 estimated the accord would boost U.S. exports by $10 billion to $11 billion a year and increase Korean exports to the United States by about $7 billion.
For the U.S. apparel industry, it means that textile imports from South Korea will have most of their tariffs eliminated, making Korean-made textiles cheaper. On average, textiles imported from South Korea carry a 5 percent to 10 percent tariff, but some synthetic categories fall into the 15 percent to 35 percent tariff range.
For U.S. clothing and accessories makers, it will make it easier to sell U.S.-made clothing, which now can be priced cheaper in South Korea. High-end apparel makers such as St. John of Irvine, Calif., whose knit suits and accessories are sought-after items in that Asian country, are hoping the free-trade agreement goes through soon.
Former President George W. Bush and his Korean counterpart signed the trade accord in 2007. But Congress has held up approval while issues surrounding auto and beef trade were resolved.
The South Korean free-trade agreement is the largest of three free-trade agreements negotiated by the Bush administration. Trade accords with Panama and Colombia are still pending.—Deborah Belgum
