The Hill
MEMA Industry News Editor’s Note: MEMA will continue to monitor the implementation of the FTA and any developments affecting suppliers’ access to this important market. For more information, please contact Dan Houton.
In less than a month, the United States will implement the first of three free-trade agreements passed by Congress last fall.
The trade accord with South Korea will go into effect March 15, following the completion over the Presidents Day weekend of the final remaining legal issues, trade officials said Feb. 21.
“In a few short weeks, the promise of the U.S.-Korea trade agreement -- including tens of thousands of export-supported jobs with better wages -- will start to come home for American businesses and working families,” said U.S. Trade Representative Ron Kirk in a statement.
"Entry into force of this agreement will open up Korea’s $1 trillion economy for America’s workers, businesses, farmers and ranchers while also strengthening our economic partnership with a key Asia-Pacific ally," he said.
Congress cleared the deals with South Korea, Panama and Colombia on Oct. 12 -- the Korea trade deal is by far the most economically meaningful of the three for the United States.
Trade officials are still in talks over the agreements with Colombia and Panama.
”President Obama insisted that we get this agreement right by forging a better deal that led to strong bipartisan support in both houses of Congress," Kirk said.
Implementation of the Korean trade deal means that about 80 percent of U.S. exports of industrial products to Korea will become duty-free, including aerospace equipment, auto parts, consumer goods, all footwear and travel goods and transportation equipment.
“This is good news for U.S. job-creators," said House Ways and Means Chairman Dave Camp (R-Mich.). "Taking this final step will remove taxes on the manufacturing goods and agriculture products U.S. companies export to South Korea, eliminate obstacles to U.S. services exports, and address key non-tariff barriers that have prevented our workers and companies from competing on a level playing field in this rapidly growing market," he said.
Camp said he plans to consult closely with the Obama administration to ensure that the trade agreements with Colombia and Panama enter into force as quickly as possible.
Ways and Means Subcomittee on Trade Chairman Kevin Brady (R-Texas) urged President Obama "to build on this strong momentum by moving promptly to complete the Trans-Pacific Partnership (TPP) and work with Congress on a forward thinking, aggressive trade agenda for the future."
The TPP could be completed some time this summer, trade officials have said.
In addition, almost two-thirds of U.S. agricultural products will become duty-free, including wheat, corn, soybeans for crushing, whey for feed use, cotton, cherries, pistachios, almonds, orange juice and wine.
“It is now up to the business community, including the hundreds of thousands of small and medium sized enterprises that make up the backbone of the U.S. economy, to take full advantage of this agreement to grow American exports,” said Thomas Donohue, president and chief executive of the U.S. Chamber of Commerce.
The agreement includes a number of non-tariff measures that will come into force on March 15, including motor vehicle safety and environmental standards, enhanced regulatory transparency, technology neutrality and customs administration.
Strengthened protections for intellectual property rights and commitments opening up Korea’s $580 billion services market also will go into effect next month.
The trade deal had been in the works for several years and, in 2007, was readied by President George W. Bush for a vote in Congress, but stalled because of disagreements between the White House and Democratic lawmakers.
In December 2010, President Obama announced the resolution of outstanding issues with the U.S.-Korea deal.
The deal was approved a day before South Korean President Lee Myung-bak arrived in Washington.