Recently, it has been announced that the Trump Administration is considering withdrawing the United States from its trade deal with South Korea. The trade deal is still in its young stages being active for only five years. The reason why Trump is considering this cancelation can be seen in the following, “”The fact is that the United States has trade deficits with many, many countries and we cannot allow that to continue. And we’ll start with South Korea right now” (NPR), which he is not particularly happy of. Furthermore, Trump during his campaign had promised that his Administration would make every effort to cancel and renegotiate trade deals that would benefit the United States.
However, the administration may in fact delay this act since both South Korea and the United States are dealing with the increase tensions of the hostile North Korean regime and its illegal nuclear program. This is because the United States does not want to possibly anger a key ally in solving this global crisis. The only true question that most news and academic analysists have is how long will the Trump administration provide the deal to sit on the shelve. This is because on countless of occasions Trump has made it clear that he believes that this deal is a bad deal for Americans, who he has stated are purchasing at ever increasing rates products from the South Koreans.
Previously many U.S companies complained that trading was problematic and unfair when trading with South Korea until 2012 when the United States government enacted the Korea-U. S Free trade agreement. The agreement’s purpose was supposedly supposed to remove the many tariffs and other barriers, which restricted trade. Yet ever since the agreement was enacted it has been said that the trade deficit between the U.S and South Korea has been broadening ever since. Additionally, Rob Scott, senior economist and director at the left-leaning Economic Policy Institute stated “We were supposed to benefit from the deal. It didn’t work out that way. At the end of the day, U.S. exports to Korea have fallen since the agreement took effect” (NPR). Also, it has been reported that for these past five years under the deal many South Korean Tech and automobile companies have seen major gains in their profits because of Americans purchasing their technology. Such companies include but are not limited to Hyundai and Kia. Yet there are some U.S exporters that have seen benefits from this agreement with South Korea those being in the agricultural sector. As stated in the following “Four years ago, [South Koreans] didn’t import any soybean oil from the United States, and now it’s up to 180,000 metric tons of soybean oil” (NPR).
Therefore, many have stated or are stating that the complete elimination of the trade pact with South Korea would negatively affect many American consumers because for all their favorite products produced in South Korea would see a dramatic jump in their prices. These products include but are not limited to Samsung products, LG products.