Congress Approves Korea Free Trade Agreement
After more than four years of convoluted negotiations (both bilaterally and domestically), Congress today finally approved the legislation necessary to ratify and implement the Korea-U.S. Free Trade Agreement (KORUS FTA). This long overdue action is an important step in U.S. trade policy, and will help open new opportunities and new markets. And the agreement was ratified just in time to welcome South Korea’s President Lee Myung-bak to a joint meeting of Congress on Thursday afternoon and to the White House for a state dinner on Thursday evening.
The KORUS FTA bill was approved as part of a package of trade-related measures, which also included agreements with Colombia and Panama and an extension of Trade Adjustment Assistance program for displaced U.S. workers. In total, it is estimated that these three agreements would boost U.S. exports by about $13 billion annually – with approximately $10-$11 billion alone stemming from implementation of the KORUS FTA. The White House also estimates that the trade package – once fully implemented – could generate up to 280,000 new jobs, injecting much-needed vitality into the struggling U.S. economy.
Applied Materials has long championed passage of the KORUS FTA, and has worked side-by-side with the U.S.-Korea Business Council and the U.S.-Korea FTA Business Coalition to push for passage and implementation of what is the most significant trade agreement since the North American Free Trade Agreement (NAFTA). As a market-leading, technology-driven company with more than 85 percent of our sales outside the United States, we as a company are vitally concerned with ensuring open access to international markets, while also ensuring the consistent enforcement of existing trade agreements.
Here’s why this agreement matters: South Korea’s $1 trillion economy represents the 7th largest trading partner for the United States. It’s also the 8th largest export market and a top-ten export market for U.S. high-tech goods. It also is one of Applied’s top markets. Implementation of this trade agreement will provide greater market access, regulatory fairness and enhanced intellectual property protection. As an example of the potential benefit, the Korean Customs Service this summer estimated that exports from the European Union to Korea increased by 16 percent and Korean exports to the European Union increased by more than 17 percent in the first two weeks after the EU-Korea FTA went into effect on July 1. So, there is real opportunity for growth.
Applied Materials applauds Congress for taking this important step to open up new markets in South Korea, while assisting U.S. workers who might be displaced. This truly is a win-win and we look forward to speedy passage in Korea’s National Assembly.