Korea to refine trade strategy as protectionism becomes 'new normal': minister
Trade Minister Yeo Han-koo, right, poses with United States Trade Representative(USTR) Jamieson Greer at the USTR office in Washington, July 25. Yonhap
Korea will fine-tune its trade strategy as global trade protectionism is becoming a "new normal," the trade minister said Thursday, noting that uncertainties stemming from the United States' tariff scheme continue to linger despite the countries' bilateral trade agreement.
"We overcame a major hurdle last week by striking a tariff deal with the U.S., but the (trade) situation still remains uncertain," Trade Minister Yeo Han-koo said in a meeting on the country's trade strategy.
"The protectionist policies have become the new normal in the global trade environment, with major economies using their market and technologies as weapons," he added. "The government will newly review its trade strategy in response to the recent trend."
The minister said the government will also work to swiftly implement support measures for sectors vulnerable to U.S. tariffs and devise a long-term strategy to boost the fundamental competitiveness of domestic industries, such as the diversification of their trade networks.
Washington agreed to lower its reciprocal tariff rate for Korea to 15 percent from the initially proposed 25 percent under the bilateral trade deal signed last week while also slashing its tariffs on Korean cars to 15 percent from the 25 percent imposed on all imported cars from countries that have failed to reach a trade deal with the U.S.
Regarding U.S. President Donald Trump's remarks that the U.S. will impose 100 percent tariffs on semiconductor imports, Yeo said Korea will be treated as a most favored nation (MFN) under the bilateral tariff deal.
"If the U.S. semiconductor tariff rate for MFNs is set at 15 percent, Korea will also enjoy 15 percent tariffs regardless of the rate going up to 100 percent or 200 percent," Yeo said in a radio interview with broadcaster SBS.
"In the trade deal, the U.S. administration promised to grant us MFN status when imposing tariffs on the semiconductor and bio sectors in the future," Yeo added.
Asked if Samsung Electronics and SK hynix, two major chip manufacturers in Korea, will not face 100 percent tariffs, Yeo answered they would not.
Industry and trade experts here expect Washington's tariff rate for chip imports from MFNs to be set at 15 percent as the U.S. agreed to apply 15 percent duties on European products in a trade agreement with the European Union last week.