[CTC] Trump says US, South Korea will renegotiate trade agreement

[Arthur Stamoulis]

http://thehill.com/policy/finance/341971-trump-says-us-south-korea-will-renegotiate-trade-agreement <http://thehill.com/policy/finance/341971-trump-says-us-south-korea-will-renegotiate-trade-agreement>
 
Trump says US, South Korea will renegotiate trade agreement
BY VICKI NEEDHAM - 07/13/17 06:41 PM EDT 30 <http://thehill.com/policy/finance/341971-trump-says-us-south-korea-will-renegotiate-trade-agreement#bottom-story-socials>
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President Trump told reporters Wednesday that the U.S. is renegotiating a trade agreement with South Korea, contradicting his administration's stated intention to update the pact.

During a flight to Paris, Trump called the five-year-old agreement with South Korea “a horrible deal” and said negotiations had started to rework the accord, which was completed during President Obama's first term.

"So we're starting, we started, as of yesterday, renegotiating the deal with South Korea," Trump told reporters aboard Air Force One on the way to Paris on Wednesday night.
"We have to."

But the U.S. and South Korea have agreed that only modest changes will be made to modernize the deal instead of renegotiating the agreement. 

U.S. Trade Representative Robert Lighthizer wrote a letter on Wednesday to South Korean Trade Minister Joo Hyung-hwan requesting a meeting to discuss "possible amendments and modifications" to the deal.

“I believe that this session and the follow-up negotiations will provide an opportunity to review progress on the implementation of the agreement, resolve several problems regarding market access in Korea for U.S. exports, and, most importantly, address our significant trade imbalance,” Lighthizer wrote in the letter. 

The language is important here because talk of a renegotiation would cause consternation among South Korean officials who tout the agreement as beneficial to both countries.

In response, Yeo Han-koo, director general of the Bureau of Trade Policy, said that the Korean government "basically recognizes the South Korea-U.S. free-trade agreement as mutually beneficial, and so do the businesses from both countries," according to news reports. 

"The government wants to keep the framework as it is, not shaking it up greatly," he said. 

Any suggestion that the talks go beyond an updating would likely endanger the talks and increase tensions between the two allies.

U.S. and South Korean officials will aim to meet next month in Washington, D.C. 

The U.S. trade deficit in goods between the two countries was $27.6 billion in 2016, down 2.3 percent from the prior year.

But the deficit has widened from $13.2 billion since the pact was ratified, a concern within the Trump administration. 

Korea is the U.S.'s sixth largest goods trading partner.

Overall, U.S. goods and services trade with Korea totaled an estimated $144.6 billion in 2016 and the deficit was $17 billion, according to USTR.

The U.S holds a surplus of $10.7 billion in services with Seoul.

During his comments to reporters, Trump also took a broader jab at efficacy of U.S. trade accords, hitting China for not helping more with containing North Korea by continuing to trade with them.

"We are being absolutely devastated by bad trade deals," the president said.

"We have the worst of all trade deals is with China."

The U.S. doesn’t have a trade agreement with Beijing.
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