Korea and the U.S. will soon conclude work on the final text of their recently concluded free trade agreement, paving the way for the pact to be ratified in both countries, a high-ranking trade official said Wednesday.
In December last year, both countries reached a final agreement focusing on U.S. demands that Korea soften its automotive safety and environmental standards.
The Korea-U.S. free trade agreement was originally signed in June 2007, but the parliamentary ratification of the deal in both countries has stalled on calls from Washington that the lopsided auto trade and beef issue be resolved.
“Both sides have been working out the final text of the trade pact since last month ... and they are expected to soon announce the final text of the deal,” Korea’s Deputy Minister for Trade Ahn Ho-young told reporters.
Trade officials from both countries met twice following last month’s breakthrough on the long-stalled pact. Korea has long said it would not renegotiate on the initial deal, but agreed to address key U.S. concerns on cars in return for a two-year delay in the elimination of its tariffs on American pork. Beef trade, one of the sticky points that has blocked ratification of the deal, was not included in the agreement.
Under the revised terms, the two countries agreed to scale back tariff cuts for cars. The U.S. will eliminate its 2.5 percent tariff on Korean automobiles within four years, instead of immediately or after three years as was previously agreed, after the deal takes effect.
Korea will cut its 8 percent tariff on U.S. car imports to 4 percent immediately, instead of eliminating it immediately.
Korea will allow more imports of U.S.-made vehicles that meet American standards and not necessarily Korean ones. Each U.S. automaker will be able to send Korea 25,000 cars a year.
U.S. automakers will also be given flexibility in meeting Korean emissions and environmental requirements.