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Korea Herald
26-06-2025
- Business
- Korea Herald
No compelling rationale found for Trump's 'reciprocal' tariffs on S. Korea: think tank report
The overwhelming majority of US exports to South Korea are already tariff-free under a bilateral free trade agreement, a think tank report showed Wednesday, stressing that no "compelling" rationale has been found for the Trump administration's "reciprocal" tariffs on the Asian country. The Korea Economic Institute of America released the report, titled "Fairness and Reciprocity? Reconsidering Trump's Liberation Day Tariffs on South Korea," which looked into whether the United States' claims about unfair South Korean trade practices are accurate. President Donald Trump announced reciprocal tariffs on April 2 -- a day that he called "Liberation Day." Meant to match what other countries impose on US exports, the tariffs, including 25 percent duties on South Korea, took effect on April 9, but Trump paused them for 90 days on the same day to allow for negotiations. "In short, this report finds no compelling economic rationale for the Liberation Day tariff rate on South Korea," the report said. "This suggests that the tariffs are better understood as political tools rather than trade policy rooted in sound analysis." Citing data from the Korea Customs Service and US Department of Agriculture, the report estimated that South Korea's effective weighted average tariff on US imports last year ranged between 0.19 and 2.87 percent -- a finding that challenges the much higher figures that the Office of the US Trade Representative and Department of Commerce cite. Measured in trade value, 95 percent of US exports to South Korea are tariff-free under the bilateral FTA, with most remaining tariffs affecting a narrow range of agricultural products subject to quotas, the report said. Of the remaining 5 percent, tariffs will be eliminated from another 4 percent of US exports to South Korea by 2026, it said. Touching on non-tariff issues, the report took note of the fact that there are bilateral and multilateral mechanisms to address the issues "more satisfactorily" in an apparent show of concern over the US' unilateral move to address trade deficits. "Ultimately, this report concludes that there is little need to change the US-South Korea trade relationship," it said. "It recommends resolving outstanding concerns—especially those related to non-tariff measures—through established bilateral mechanisms under the bilateral FTA rather than unilateral action." South Korea and the US have been in consultations to reach a wide-ranging deal over US tariffs, South Korea's non-tariff barriers and economic and industrial cooperation, before July 8, when the suspension of reciprocal tariff ends. Seoul has been seeking to avoid or minimize the impact of new US tariffs, including sectoral tariffs on steel and automobiles. (Yonhap)
Saba Yemen
23-06-2025
- Business
- Saba Yemen
South Korean Exports Rise 8.3% on Chip Demand
Seoul - (Saba): South Korean exports rose 8.3% year-on-year in the first 20 days of this month, driven by strong demand for semiconductors. According to data released by the Korea Customs Service on Monday, Korean exports reached $38.67 billion from June 1 to 20, compared to $35.69 billion during the same period last year. The average daily export volume increased 12.2% year-on-year during the period, while the number of working days during this period reached 14, compared to 14.5 days during the same period last year. South Korean imports increased 5.3% year-on-year to $36.1 billion during this period, resulting in a trade surplus of $2.6 billion. In detail, semiconductor exports increased by 21.8% year-on-year to $8.85 billion, while chip exports accounted for 22.9% of total exports during the period, a 2.5 percentage point increase compared to the same period last year. Automobile exports rose by 9.2% year-on-year to $3.65 billion, and ship exports jumped by 47.9% to $1.58 billion. By destination, exports to the United States and the European Union increased by 4.3% and 23.5% year-on-year, respectively, while exports to China, South Korea's largest trading partner, declined by 1% during the same period. Whatsapp Telegram Email more of (International)
India Gazette
11-06-2025
- Business
- India Gazette
Semiconductors emerged as a key growth driver for South Korea's exports rebound in early June
ANI 11 Jun 2025, 12:42 GMT+10 New Delhi [India], June 11 (ANI): South Korea's exports witnessed a robust recovery in the first 10 days of June, climbing 5.4 percent year-on-year, according to the data released by the Korea Customs Service on Wednesday. According to a report in the Korea Herald, this uptick marks a significant shift from May's decline and is largely attributed to strong global demand for semiconductors and the June 1-10 period, outbound shipments totalled USD 15.47 billion, a notable increase from USD 14.68 billion recorded a year earlier. The daily average volume of exports saw an even sharper rise, jumping 15 per cent on-year, despite fewer working days (5.5 days compared to 6 days last year).Semiconductors emerged as a key growth driver, with exports surging 22 per cent to USD 3.62 billion, accounting for a substantial 23.5 per cent of the nation's total outbound shipments. The automotive sector also contributed significantly, with shipments rising 8.4 per cent to USD 1.3 billion. Shipbuilding experienced an impressive boom, skyrocketing 23.4 per cent to USD 896 not all sectors shared in the growth, sales of petroleum products saw a decline of 20.5 per cent, falling to USD 1.11 terms of destinations, exports to China, South Korea's top trading partner, increased by 2.9 per cent to USD 3.06 billion. Shipments to the European Union spiked by 14.5 per cent to USD 1.5 billion, while exports to the United States also saw a modest rise of 3.9 per cent, reaching USD 2.95 the positive start to June, the country remains cautious. An official from the customs agency noted that it 'remains to be seen whether the upward trend in monthly exports will continue.' This comes after a 1.3 percent drop in May's exports, which snapped a three-month winning streak, partly due to US President Donald Trump's tariff measures impacting shipments to the United States. The strong performance in early June provides a hopeful sign for the nation's trade outlook amidst evolving global economic conditions. (ANI)
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Korea Herald
04-06-2025
- Business
- Korea Herald
[Contribution] KCS steps up to navigate ‘fog of war' in global tariffs
Carl von Clausewitz, the German military theorist, introduced the concept of the "Fog of War" in his seminal work "On War." He described war as a realm of unpredictable uncertainty, where quick and accurate judgment by commanders is crucial amid incomplete information and unforeseen variables. Today, the rapidly shifting US tariff policies and the responses from major economies have created a global trade environment reminiscent of Clausewitz's fog-covered battlefield. In a global economy where visibility is limited and uncertainty prevails, Korean businesses must work to reduce unpredictability while strengthening their strategic decision-making and judgment capabilities. In this context, a clear understanding of tariff classification and rules of origin becomes a crucial first step in navigating the uncertainty sparked by President Trump's tariff policies. Tariff classification is the process of assigning serial numbers to imported and exported goods based on standards set by the World Customs Organization (WCO). These numbers not only determine applicable tariff rates but also dictate various import and export requirements. While WCO provides a unified framework, individual countries often interpret and apply these standards differently. As a result, the same product can be assigned different codes in different countries. Since March, the US has imposed a 25 percent tariff on certain items, including steel and aluminum derivatives. The challenge arises because the US applies these tariffs using its own classification system, the Harmonized Tariff Schedule of the United States (HTSUS). For Korean companies accustomed to Korea's classification system, determining whether their products fall under US tariff targets is not always clear-cut. As tariff differences grow sharper depending on product classification, businesses now face greater pressure to ensure accurate and strategic classification of their goods. The importance of rules of origin has also risen significantly under the evolving US tariff regime. Under the Korea-US Free Trade Agreement, product origin has traditionally been determined using rules such as the change in tariff classification criterion or value content criterion. However, recent US measures have shifted this to the Substantial Transformation Criterion, even for items subject to bilateral tariffs, regardless of FTA rules. Under this standard, US customs authorities determine origin based on whether a product has undergone substantial changes in name, use, or character. The lack of clear, consistent case rulings makes it extremely difficult for businesses to predict outcomes. Moreover, Korean companies may suffer indirect harm — such as customs delays or post-entry verifications — if products from other countries with higher tariff rates are fraudulently labeled as Korean to evade duties. In response to such uncertainty, the Korea Customs Service established the KCS Response Headquarters for Global Tariff Changes and Domestic Industry Protection (K-GTR H.Q.s) on March 28. This task force goes beyond simply providing information. It functions as a comprehensive, proactive unit managing international cooperation, preemptive customs and tax risk assessments, close business support, and crackdowns on illegal circumvention of trade laws. Since its launch, the K-GTR H.Q.s has prioritized resolving uncertainties surrounding tariff classifications and rules of origin while supporting corporate decision-making. It has swiftly distributed correlation charts between Korean and US tariff codes for key items such as steel, aluminum derivatives, automobiles, and auto parts. To further ease classification-related confusion, it introduced fast-track pre-ruling procedures and expanded consultation services with the US tariff classification center. In the area of origin rules, the headquarters has begun immediate information sharing on non-preferential rules of origin and case rulings that can assist business planning. Customized consulting and preventive inspections are also underway to help firms comply. To prevent Korean exports from being harmed by falsely labeled foreign goods, the Korea Customs Service is intensifying inspections — particularly in cooperation with US Customs and Border Protection and industry associations — on critical sectors like steel and furniture, which are vulnerable to origin fraud. Looking ahead, the Korea Customs Service aims to continue serving as a reliable guide for Korean exporters amid the turbulent waves of global tariff conflicts. It plans to provide ongoing classification information for US-targeted sectors such as semiconductors and pharmaceuticals and to roll out notification services for potential violations of origin rules, particularly for companies handling steel and aluminum derivative products. Waiting for the fog to lift will not lead to a path forward. Someone must carry the light and lead the way. The Korea Customs Service pledges to be that light, helping Korean businesses move forward with confidence, even through the haze of uncertainty.
New Straits Times
29-05-2025
- Automotive
- New Straits Times
South Korea's trade surplus with US will shrink, exporters say
SEOUL: South Korea's record-high trade surpluses with the United States will gradually narrow as companies continue to invest in the US market, the country's biggest exporter group said on Thursday. "There is a high possibility of trade imbalances between South Korea and the United States gradually easing on continued and prolonged investments in the country," Korea International Trade Association (KITA) said in a report. In 2024, 46.8 per cent of US imports from South Korea were intermediate goods shipped to the country for direct investments, according to KITA. South Korea earned a surplus of US$55.6 billion from trade with the US in 2024, up 25 per cent from 2023 and a record high, led by rising car exports, according to Korea Customs Service data. Seoul has been engaging with Washington since they agreed in mid-April to craft a trade package lowering tariffs by July 8. In the latest working-level discussion last week, Washington demanded that Seoul resolve the large trade imbalance between the two countries, according to local media reports. KITA said South Korea's rising trade surpluses did not result from unfair trade practices. Of the increase of US$36.9 billion in the last three years, US$27.7 billion was related to substitutions of Chinese products within US supply chains, increases in US demand and structural changes in US imports, the business group said.
