South Korea's government said it would soon open talks with the US Trade Representative after Washington announced plans to impose an additional 12.5 percent tariff on Korean goods.
The Ministry of Trade, Industry and Energy said Tuesday that Yeo Han-koo, chief trade negotiator, would contact USTR Ambassador Jamieson Greer "in the coming days" to discuss the announcement.
The USTR said Monday that it plans to impose additional tariffs of 10 or 12.5 percent on imports from 60 economies that have failed to adequately enforce bans on goods produced with forced labor.
The proposed tariffs stem from a USTR probe into forced labor practices. The 54 economies — including South Korea, China, Japan, Russia, the United Kingdom, Australia, Brazil and Vietnam — that have not enacted or effectively enforced import bans on forced-labor goods face the higher 12.5 percent rate.
Six economies — the EU, Indonesia, Canada, Ecuador, Mexico and Pakistan — face a 10 percent tariff. Those economies have either implemented import bans, pledged to do so, or partially adopted relevant measures.
Whether the tariffs will actually take effect will be decided after a public comment period and a hearing scheduled for July 7.
In a CNBC interview, Greer said the administration would put forward proposals on how to address unfair trade practices such as structural overcapacity and forced labor, adding that tariffs could be one of the tools used.
Earlier, the US Supreme Court ruled in February that the reciprocal tariffs President Donald Trump had imposed on trading partners under the International Emergency Economic Powers Act were unlawful.
The Trump administration subsequently introduced a 10 percent "global tariff" on all trading partners, including South Korea, under Section 122 of the Trade Act. That measure is valid only for 150 days and expires July 24.
The administration has been moving quickly to put replacement tariffs in place under Section 301 of the Trade Act to fill the gap, citing forced labor and overcapacity as justifications.
South Korea last year announced $350 billion in planned investment in the United States through tariff negotiations, securing a reduction in the threatened 25 percent reciprocal tariff to 15 percent.
The ministry said the government had been working closely with related ministries and industry groups since the USTR launched its forced-labor import probe. It submitted written comments arguing that Section 301 measures are "inappropriate and unnecessary" while maintaining close communication with the USTR through bilateral consultations.
The ministry added that the government would actively present its efforts to eradicate forced labor through upcoming comment submissions and public hearings. It said it would do its best to ensure the balance of benefits under the existing Korea-US tariff agreement is not undermined, taking into account the ongoing Section 301 overcapacity investigation.
joze@heraldcorp.com
