It took American and South Korean negotiators over three years to reach an agreement on the KORUS Free Trade Agreement (FTA) initially signed in 2007, an agreement that came like a bright ray of light for American car makers on Friday.
The final hurdle in the way of the FTA getting its final seal of approval, the passage of the agreement by the US Congress, should be overcome as soon as possible, says South Korean President Lee Myung-bak, opening the way for “huge economic benefits for both.”
According to what is known so far, the South Korean side has made big concessions in the automotive sector, agreeing to postpone for five years the abolition of the 2.5 percent US tax on South Korean auto imports and at the same giving the green light for more US made cars to be exempted its safety standards. Now, any automaker can bring into South Korea 25,000 vehicles, compared to 6,500.
The American automotive industry sees the FTA as a major success, with GM being among the first to express its satisfaction. In a statement released today, the car maker says it now has time to “assess whether Korea's market has opened as negotiated before reducing its tariffs.”
“General Motors congratulates US and Korean trade negotiators for successfully addressing many of the concerns related to auto trade in the U.S.-Korea Free Trade Agreement (FTA),” reads the statement.
“GM is especially pleased that the negotiators agreed to address concerns of American auto manufacturers regarding non-tariff barriers in Korea by increasing the number of vehicles to 25,000 that can be imported into Korea under a small volume exemption.”
More reactions from the industry on the FTA are expected throughout the day.
The final hurdle in the way of the FTA getting its final seal of approval, the passage of the agreement by the US Congress, should be overcome as soon as possible, says South Korean President Lee Myung-bak, opening the way for “huge economic benefits for both.”
According to what is known so far, the South Korean side has made big concessions in the automotive sector, agreeing to postpone for five years the abolition of the 2.5 percent US tax on South Korean auto imports and at the same giving the green light for more US made cars to be exempted its safety standards. Now, any automaker can bring into South Korea 25,000 vehicles, compared to 6,500.
The American automotive industry sees the FTA as a major success, with GM being among the first to express its satisfaction. In a statement released today, the car maker says it now has time to “assess whether Korea's market has opened as negotiated before reducing its tariffs.”
“General Motors congratulates US and Korean trade negotiators for successfully addressing many of the concerns related to auto trade in the U.S.-Korea Free Trade Agreement (FTA),” reads the statement.
“GM is especially pleased that the negotiators agreed to address concerns of American auto manufacturers regarding non-tariff barriers in Korea by increasing the number of vehicles to 25,000 that can be imported into Korea under a small volume exemption.”
More reactions from the industry on the FTA are expected throughout the day.