The United States could link South Korea's entry into the Trans-Pacific Partnership to the resolution of issues related to the implementation of the free trade agreement between the two countries, a U.S. report showed Sunday.
The Congressional Research Service made the assessment in a report on U.S.-South Korea relations, saying South Korea is a likely candidate for any future membership expansion of the 12-nation free trade deal sealed early this month.
"U.S. officials, who have welcomed South Korea's interest in joining the TPP, have linked support for South Korea's possible entry to Seoul's willingness and ability to continue to resolve ongoing issues with the implementation of the KORUS FTA," the CRS said in the Oct. 8-dated report.
The report noted, however, that progress had been made on implementation issues.
The Korea-U.S. trade deal entered into force in March 2012.
U.S. businesses have increasingly voiced complaints claiming that the agreement has not been fully implemented due to non-tariff trade barriers maintained by the South.
Though South Korea will be unable to join the TPP until it is ratified by the current members, the country is a good candidate of new membership given "its level of interest and existing FTAs with 9 of the 12 TPP countries," the CRS report said.
"The size and potential strategic importance of the proposed TPP would expand if South Korea -- East Asia's third-largest economy -- were to join, although its entry may not have a significant impact on U.S.-South Korea trade flows given the existing bilateral U.S.-South Korea FTA," it said.
Though the procedures for a country to potentially accede to a final TPP agreement are not yet known, there reportedly are "living agreement" provisions that allow future expansion of members and issues in the agreement, the report said.
In a joint fact sheet issued after Friday's summit between President Park Geun-hye and U.S. President Barack Obama, the U.S. reaffirmed it welcomes South Korea's interest in TPP, saying the country "has already adopted many high standard provisions under the Korea-U.S. free trade pact."
"The United States and the ROK have held constructive consultations on TPP and specific issues of concern, and look forward to deepening these consultations," it said.
The CRS report also pointed out concern about Seoul's intervention in foreign exchange rates.
The won's depreciation from early 2008 to 2009, falling by nearly a third to around 1,500 won per dollar, helped to stimulate South Korea's economic recovery by making its exports cheaper relative to many other currencies, particularly the Japanese yen, the report said.
"Both South Korea and Japan have been the subject of U.S. consternation over exchange rate policies in the past. The April 2015 U.S. Treasury report on exchange rate policies suggests South Korea may have intervened in foreign exchange markets to limit the appreciation of the won in early 2015," it said.
The report said that President Park's attendance at last month's Chinese military parade caused some observers to express concerns that Seoul is drifting into Beijing's orbit, but other observers pointed out the attendance was aimed at consolidating China's support for Korean unification and strategic coordination with Seoul and Washington at the expense of Pyongyang. (Yonhap)