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United States and the Republic of Korea Sign Landmark Free Trade Agreement

06/30/2007

 

 

WASHINGTON, DC – The
United States and Korea today signed an historic free
trade agreement that will expand bilateral trade and investment ties and create
new economic opportunities for people in both countries.


    
“This day is a milestone in the enduring economic and security alliance
between the United States and
Korea. Today we look ahead to
building on a half century of friendship and cooperation to promote the greater
prosperity of the people of both our nations,” said U.S. Trade Representative
Susan C. Schwab.  “The United States-Korea Free Trade Agreement is the most
commercially significant free trade agreement the United States
has concluded in nearly 20 years.  I look forward to continuing to work
with Members of Congress of both parties on the approval of this important
agreement.”


    
Ambassador Schwab signed the KORUS-FTA on behalf of the
United
States.  Trade Minister Kim Hyun-chong
signed on behalf of Korea in
a ceremony held in Cannon House
Office Building on Capitol Hill and witnessed by
over 150 guests, including U.S. Commerce Secretary Carlos Gutierrez, and other
government officials, and representatives from the manufacturing, agriculture
and service sectors.


    
The KORUS FTA was concluded on April 1, 2007, after eight formal rounds
of negotiations that took place over ten months.  It will build on an
already robust bilateral trade and investment relationship between the
United States and
Korea.  Korea is the
world’s tenth largest economy, with a GDP of nearly $1 trillion. 
Korea is the
United
States’ seventh largest goods trading partner,
with two-way goods trade in 2006 valued at approximately $78 billion.  When
implemented, the KORUS FTA will expand trade and investment flows between the
two countries.


    
In agriculture, the KORUS FTA will create highly valuable new export
opportunities for American farmers and ranchers by eliminating and phasing out
tariffs and quotas on a broad range of products.  Under the agreement,
roughly $1.91 billion, or 64 percent, of Korea’s agriculture imports from the
United
States will be immediately duty-free. 
Most remaining tariffs and quotas will be phased out over the first ten years
the agreement is in force.


    
In industrial goods, nearly 95% of bilateral trade in consumer and
industrial products will be duty-free within three years of entry into force of
the Agreement, with virtually all remaining tariffs eliminated within 10
years. 


    
Specifically with regard to automobiles, the KORUS FTA marks an
unprecedented step in eliminating the tariffs and non-tariff barriers that
U.S. auto makers have
identified as the impediments to their success in Korea’s large
market. 


    
Like all FTAs the United
States seeks, the KORUS FTA will ensure that
U.S. investors in
Korea will have the same rights and
enjoy equal footing with Korean investors.  These rights will be backed by
a stable, transparent legal framework.


    
Given the modern, developed nature of Korea’s economy,
the agreement has strong provisions that will expand market access and
investment opportunities in a number of service sectors, including
telecommunications and e-commerce.  The agreement will also expand market
opportunities for U.S. audio-visual products.  It
also provides high standards for protection and enforcement of intellectual
property rights, including trademarks, copyrights and patents, consistent with
U.S. standards.


    
The agreement incorporates provisions of the bipartisan trade agreement
reached with Congress on May 10, and will safeguard workers’ right and
environmental protections, consistent with internationally recognized standards
and principles, and ensure access to legal mechanisms.


Fact sheets are available on the USTR website:
www.ustr.gov