The U.S.—Korea Trade Agreement

General Information

The U.S.-Korea Trade Agreement is pending legislative approval by the U.S. Congress and Korea’s National Assembly. The Agreement would eliminate tariffs on over 95% of industrial and consumer goods within five years. In 2007, the U.S. International Trade Commission estimated that the tariff cuts alone in the U.S.-Korea Trade Agreement will increase exports of American goods by $10 billion to $11 billion. The increase in exports could support tens of thousands of American jobs.

The Trade Agreement also requires stronger protection and enforcement of intellectual property rights in Korea. Just as importantly, the U.S.-Korea Trade Agreement will also open Korea’s $580 billion services market to highly competitive American companies – supporting jobs for American workers in sectors ranging from delivery and telecommunications services to education and health care services.

Korea’s one trillion dollar economy currently has the 15th highest GDP according to the IMF, and its GDP per capita exceeds $20,000. Most forecasts predict positive growth for Korea, with the IMF predicting 4.5 percent growth for 2011.

At this time, the KORUS Agreement is not in force. On October 3, 2011, President Obama submitted legislation to Congress for the implementation of the KORUS Agreement. On October 12, 2011, Congress approved the implementing legislation. President Obama signed the trade agreement with Korea on October 21, 2011.

By Sector

U.S. exports to Korea grew to $38.8 billion in 2010, an increase of $10.2 billion. Korea is the seventh largest U.S. export market. Principal U.S. exports to Korea in 2010 were machinery, electrical machinery, medical instruments, aerospace, and organic chemicals.

Additional Information