President Donald Trump has signed the first trade deal of his presidency: a revamped version of the six-year-old KORUS agreement with South Korea.
“From day one, I promised the American people that I would renegotiate our trade deals to ensure that our agreements were fair and reciprocal,” said Trump after the signing. “The new U.S.-Korea agreement includes significant improvements to reduce our trade deficit and to expand opportunities to export American products to South Korea. In other words, we are now going to start sending products to South Korea.”
As with many other countries, Trump had been incensed at the fact that South Korea sells more to U.S. consumers than it buys from American exporters—the U.S. trade deficit in goods was $22.9 billion last year, though as the U.S. exports many services to South Korea, the overall deficit was just $10.7 billion.
So what is in the revamped KORUS that makes it a better deal for the U.S.?
The big focus is on cars, a strong point for the Korean economy. Under the new deal, each American auto exporter will get to send 50,000 vehicles annually to South Korea that meet U.S. safety standards, rather than Korean safety standards.
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