April 9 (UPI) — U.S. President Donald Trump has said he might delay a revised trade agreement with South Korea, but the deal known as KORUS FTA has benefited the United States more, according to a South Korean study.
While Trump has focused on the U.S. trade deficit with South Korea, Asia’s fourth-largest economy, the source of the deficit was not the FTA, economists at South Korea’s commerce ministry stated in a report published Monday.
Overall South Korea exports to the United States are up, but U.S. exports have increased owing to clauses enforced as part of KORUS, Yonhap news agency reported.
The numbers indicate South Korea exports would have still risen with or without the FTA in place.
From 2012 to 2016, South Korea exports rose by an annual average of $18.4 billion more, than the pre-FTA years of 2007 to 2011.
But the rise in South Korea exports bound for the United States owing to the FTA was relatively small.
The South Korean analysis shows in any given year from 2012 to 2016 only 17 to 36 percent of South Korean exports rose because of the free trade deal approved by former President Barack Obama and his then South Korean counterpart Lee Myung-bak.
U.S. exporters benefited more from the FTA, with about 37 to 47 percent of the U.S. export increase attributable to the free trade deal, the report states.
The South Korean analysts said the deal was a win-win for both sides, with the FTA responsible for about 30 to 35 percent of new foreign direct investments both ways.
Analysts familiar with the deal say the recently revised deal is an important move when both countries must coordinate efforts on North Korea.
Bruce Klingner, a senior research fellow for Northeast Asia at The Heritage Foundation’s Asian Studies Center, said the new deal “removes a major source of bilateral tension as the two allies strive for commonality in their approaches to North Korea.”
Klingner also said in his assessment of the deal the Trump revisions will have no actual economic benefit for the United States, since only 11,000 U.S. cars were sold in South Korea last year.