KCCI chief questions impact of agricultural concessions in US negotiations

Chey Tae-won, chairman of the Korea Chamber of Commerce and Industry (KCCI), speaks during a press conference in Gyeongju, North Gyeongsang Province, Thursday. Courtesy of KCCI

GYEONGJU, North Gyeongsang Province — While Korea considers offering greater access to its agricultural markets as a bargaining chip in ongoing tariff negotiations with the United States, the head of the nation’s largest business lobby group cast doubt on whether such concessions would have any real impact.

Trade Minister Yeo Han-koo suggested on July 14 that Korea may make “strategic” decisions in agriculture and livestock — such as opening markets for rice and beef — to avoid or reduce a 25 percent “reciprocal” tariff the U.S. plans to impose starting Aug. 1. The proposal has since sparked heated domestic debate.

“When I visit Congress, I do occasionally meet some lawmakers who raise rice and beef issues. But honestly, they are too minor to serve as any real solution. Even if the U.S. were to gain concessions on those items, it is doubtful they would make a meaningful difference,” Chey Tae-won, chairman of the Korea Chamber of Commerce and Industry (KCCI), said Thursday during a press conference on the sidelines of its annual summer forum.

“And even if we were to make concessions, I do not believe it would do much to narrow our trade surplus with the U.S. This seems more like a symbolic issue tied to farmers on both sides, rather than a measure that would deliver meaningful results.”

The U.S. has raised concerns about several Korean nontariff barriers, including an import ban on U.S. beef from cattle over 30 months old and regulatory hurdles in agricultural biotechnology, such as living modified organisms and strict agrochemical residue rules. Other issues include emissions standards for imported vehicles, proposed regulations on digital platforms and data export restrictions.

The KCCI chief also emphasized the need for Korea to maintain a “reasonable protection program” to avoid potential retaliation.

“That said, I am not an expert in this area, so I cannot say with certainty what the ideal balance should be. But as far as I understand, these items are too minor to significantly impact the overall trade deal,” he added.

Gyeongju is the venue for the upcoming Asia-Pacific Economic Cooperation (APEC) summit to be held from Oct. 31 to Nov. 1, and Chey expects the ongoing tariff issue to be resolved through the event.

“Of course, it would be even better if the issue is resolved beforehand, but if it moves in a positive direction, I still believe the timing would be appropriate,” he said.

Korea’s manufacturing industry, once thriving during its heyday in the 2010s, has struggled in recent years amid China’s rapid rise. Beijing is now posing a serious threat even in semiconductors — a sector where Korea has long been a global leader.

“We have warned about this for the past decade, calling for new industrial policies and new strategies to navigate this shift, but those warnings were not really heeded,” he said.

“As a result, I believe Korea has gone through its own version of Japan’s 'lost decade,' at least when it comes to manufacturing. Over the past 10 years, we have essentially been standing still. And it is not just stagnation; we have also grown older. Our manufacturing facilities are now outdated and limited in scale.”

Attributing the current situation to a lack of strategy, driven by a misplaced optimism that past success would automatically ensure future performance, Chey pinned his hopes on artificial intelligence (AI), which he believes could help revive the nation’s manufacturing industry, as China is also rapidly expanding its presence in that sector.

In this regard, Chey reiterated his call for a stronger economic partnership with Japan, noting that Korea lacks the scale — in both industrial output and data — to succeed in AI alone. He advocated for a Korea-Japan data-sharing framework to enhance both countries’ competitiveness, drawing inspiration from the European Union’s single-market model.

“Our scale is simply not enough, whether it is the data we have, the manufacturing industry or all the data we possess — the size is insufficient,” he said.

“To succeed in AI, we need to join hands with Japan and establish a system for exchanging data. Only by doing so can we combine Japan’s data with Korea’s and leverage it, giving us at least some chance to gain a competitive edge.”