Korea and the U.S. have signed their recently concluded free trade agreement, paving the way for the pending pact to be ratified in both countries, Seoul‘s trade ministry said Thursday.
In December last year, both countries reached a final agreement focusing on U.S. demands that South Korea soften its automotive safety and environmental standards.
The Korea-U.S. free trade agreement, known as the KORUS FTA, 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.
South 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.
Seoul will do its part by cutting its 8 percent tariff on U.S. car imports to 4 percent immediately.
In addition, South Korea plans to 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 South Korea 25,000 cars a year.
U.S. automakers will also be given flexibility in meeting South Korean emissions and environmental requirements.
Early this week, the South Korean cabinet endorsed a supplementary agreement to the free trade deal concluded between South Korea and the United States.
The main and the supplementary agreements need to get parliamentary ratification before both countries can enforce them. (Yonhap News)