US, S. Korea trade grows 11.3 pct since FTA

Bilateral trade between South Korea and the US rose 11.3 percent since the Korea-US free trade agreement (KORUS FTA) went into effect two months ago, said the Korea Customs Service (KCS) Sunday. Korea’s overall exports from March 15 to April 14 posted $93.4 billion, a four percent fall, while imports posted $89.0 billion, a 2.3 percent decline. Meanwhile, exports bound to the US amounted to $11.18 billion with a double digit growth, while imports to Korea rose at a moderate rate of two percent to $7.73 billion. “US exports and imports recorded stable growth despite China’s slowing economy and EU’s fiscal crisis, thanks to the FTA,” explained the KCS. Korea’s trade surplus with the US added up to $3.45 billion, which amounts to 78.4 percent of the entire trade surplus ($4.4 billion). US-bound exports grew by 19.4 percent as the FTA eased tariffs and boosted exports for auto parts (15 percent), automobiles (31 percent), petrol products (42 percent), rubber (10 percent), and textiles (7.4 percent). Exports of items that do not qualify for tariff concessions saw a 6.9 percent growth. Similarly, US imports edged up 3.4 percent for oranges (31 percent), lemons (172 percent), semiconductors (35 percent), semiconductor manufacturing equipments (49 percent), and other products given better a boost by the FTA. Import of products that are given no tariff concessions grew at a slower rate of 0.7 percent. 58.7 percent of exporters and 48.2 percent of importers took advantage of the FTA. Meanwhile, some traders had difficulties adapting to the new changes under the FTA. Of the 2,427 inquiries received by the KCS in a single day, 44.3 percent (1,076) were related to the FTA. Most of the questions (64 percent) were related to the trade agreement with the US, followed by the EU (31.3 percent) and ASEAN (4.7 percent). Furthermore, the signing of multiple trade deals has created a “spaghetti bowl” problem where overlapping rules of origins and other regulations end up hindering business activities, worry experts.