Korea-US agreement on investment package does not require parliamentary ratification: industry minister
Industry Minister Kim Jung-kwan speaks at a parliamentary industry committee meeting held at the National Assembly in Seoul, Tuesday. Yonhap
A memorandum of understanding (MOU) on Korea's planned $350 billion investment in the United States does not require ratification by the National Assembly, the industry minister said Tuesday, noting the MOU is nearly complete.
Asked if the Seoul government is planning to ask for parliamentary ratification of the MOU during a parliamentary industry committee meeting, Industry Minister Kim Jung-kwan said, "We do not have such a plan."
"First of all, the MOU itself states that it is nonbinding," Kim said, explaining why the MOU does not require the Assembly's ratification, unlike a free trade agreement.
Kim said no other economy that signed a trade deal with the U.S., such as Japan and the European Union, received parliamentary ratification for their agreements.
Such a process, which makes the deal legally binding, could create further difficulties for the countries amid lingering uncertainties, like the U.S. Supreme Court's ongoing deliberation on the legality of the U.S. administration's tariff scheme, he added.
The Korean government has been working to propose a special bill for its investment commitment to the U.S. after the finalized tariff agreement was reached during President Lee Jae Myung's summit with U.S. President Donald Trump on the sidelines of the Asia-Pacific Economic Cooperation (APEC) summit in the southeastern city of Gyeongju late last month.
On Oct. 29, the two sides reached an agreement on the details of Seoul's $350 billion investment pledge made in exchange for lower U.S. tariffs.
Under the final terms, the investment will consist of $200 billion in cash installments, with an annual cap set at $20 billion, and an additional $150 billion for bilateral shipbuilding cooperation.
Meanwhile, the industry minister said Seoul and Washington have nearly completed the MOU and a joint fact sheet on the recent deal.
The joint documents were initially expected to be released last week, but Seoul officials have said the two sides were making adjustments on details related to the security area.
The minister also reaffirmed the U.S. tariff cuts on Korean cars will take effect retroactively from the first day of the month the Seoul government submits a special bill to the Assembly to establish a Korea-U.S. investment fund.