Skip to main content
  • Sections
  • Search

Center for Strategic & International Studies

User menu

  • Subscribe
  • Sign In

Topics

  • Climate Change
  • Cybersecurity and Technology
    • Cybersecurity
    • Data Governance
    • Intellectual Property
    • Intelligence, Surveillance, and Privacy
    • Military Technology
    • Space
    • Technology and Innovation
  • Defense and Security
    • Counterterrorism and Homeland Security
    • Defense Budget
    • Defense Industry, Acquisition, and Innovation
    • Defense Strategy and Capabilities
    • Geopolitics and International Security
    • Long-Term Futures
    • Missile Defense
    • Space
    • Weapons of Mass Destruction Proliferation
  • Economics
    • Asian Economics
    • Global Economic Governance
    • Trade and International Business
  • Energy and Sustainability
    • Energy, Climate Change, and Environmental Impacts
    • Energy and Geopolitics
    • Energy Innovation
    • Energy Markets, Trends, and Outlooks
  • Global Health
    • Family Planning, Maternal and Child Health, and Immunizations
    • Multilateral Institutions
    • Health and Security
    • Infectious Disease
  • Human Rights
    • Building Sustainable and Inclusive Democracy
    • Business and Human Rights
    • Responding to Egregious Human Rights Abuses
    • Civil Society
    • Transitional Justice
    • Human Security
  • International Development
    • Food and Agriculture
    • Governance and Rule of Law
    • Humanitarian Assistance
    • Human Mobility
    • Private Sector Development
    • U.S. Development Policy

Regions

  • Africa
    • North Africa
    • Sub-Saharan Africa
  • Americas
    • Caribbean
    • North America
    • South America
  • Arctic
  • Asia
    • Afghanistan
    • Australia, New Zealand & Pacific
    • China
    • India
    • Japan
    • Korea
    • Pakistan
    • Southeast Asia
  • Europe
    • European Union
    • NATO
    • Post-Soviet Europe
    • Turkey
  • Middle East
    • The Gulf
    • Egypt and the Levant
    • North Africa
  • Russia and Eurasia
    • The South Caucasus
    • Central Asia
    • Post-Soviet Europe
    • Russia

Sections menu

  • Programs
  • Experts
  • Events
  • Analysis
    • Blogs
    • Books
    • Commentary
    • Congressional Testimony
    • Critical Questions
    • Interactive Reports
    • Journals
    • Newsletter
    • Reports
    • Transcript
  • Podcasts
  • iDeas Lab
  • Transcripts
  • Web Projects

Main menu

  • About Us
  • Support CSIS
    • Securing Our Future
Photo: Chung Sung-Jun/Getty Images
Newsletter
Share
  • LinkedIn
  • Facebook
  • Twitter
  • Email
  • Printfriendly.com

KORUS Revision: Not the Worst Outcome

Korea Chair Snapshot

March 26, 2018

On March 26, it was announced that Seoul and Washington had reached a deal to revise the U.S.-Korea Free Trade Agreement (KORUS FTA).  U.S. president Donald Trump had previously called the KORUS FTA a “horrible deal” and threatened to withdraw from the bilateral agreement.  The two sides entered into negotiations to revise the deal beginning on August 22, 2017.

The revised agreement -- which follows on from the administration’s decision to exempt South Korea from 25% steel tariffs recently imposed by President Donald Trump under Section 232 of the Trade Expansion Act of 1962 (Proclamation 9705) on March 8, 2018 -- limits South Korean steel exports to the U.S. to 70 percent of the last three years’ annual average. This amounts to about 2.68 million tons of steel exports.

In the renegotiated deal, South Korea also agreed that U.S. auto companies would be allowed to export 50,000 vehicles per automaker per year into the country under U.S. safety standards. The previous limit was 25,000 vehicles per automaker per year, that comply with U.S. safety standards and does not require additional measures to meet South Korean safety standards. Finally, the two countries also agreed in the deal that U.S. tariffs on Korean trucks would be extended by 20 years until 2041.

  • This compromise agreement is a better outcome than expected given U.S. president Donald Trump’s previous criticisms of the agreement and threats to walk away from it.
  • The deal allows President Trump to make the argument that he has helped protect the U.S. steel and auto industries (though experts believe it is unlikely that U.S. automakers will export that many cars to South Korea given the average under the current cap of 25,000 is only 10,000 for the last year – imports finally exceeded 60,000 units in 2016 ).

  • On steel, the U.S. essentially leveraged the unilateral tariff on steel (and South Korea’s exemption) to achieve a 30 percent reduction in South Korean exports.
  • The revision represents efforts by both sides to keep the alliance on good footing given the need for policy coordination on the North Korean nuclear issue and the upcoming summits between the two Koreas and U.S. and North Korea.
  • If there is any tacit issue linkage with this agreement, we might expect to see South Korea agreeing to a higher burden sharing obligation in ongoing negotiations on a new Special Measures Agreement where the U.S. is pushing for South Korea to pay larger share of costs for stationing U.S. forces on the Korean peninsula. 
Written By
  • Twitter
Victor Cha
Senior Vice President for Asia and Korea Chair
Media Queries
Contact H. Andrew Schwartz
Chief Communications Officer
Tel: 202.775.3242

Contact Paige Montfort
Media Relations Coordinator, External Relations
Tel: 202.775.3173
Related
Asia, Asia Program, Asian Economics, Economics, Korea, Korea Chair, Korea Chair Publications, Korea Chair Snapshot, Trade and International Business, U.S.-ROK Alliance

Most Recent From Victor Cha

Upcoming Event
The Capital Cable #51: 2022 NATO Summit
June 30, 2022
Interactive
Sinpo South Shipyard Update: Routine Activity
June 28, 2022 | Joseph S. Bermudez Jr., Victor Cha, Jennifer Jun
In Beyond Parallel
In the News
What a Concert by K-Pop Legend Rain in South Korea’s Former Presidential Compound Says About the Country’s Politics
TIME Magazine | Chad De Guzman
June 17, 2022
On Demand Event
The Capital Cable #50: Korea-Japan Relations and Trilateral Cooperation
June 16, 2022
Interactive
New Activity at Punggye-ri Tunnel No. 4
June 15, 2022 | Joseph S. Bermudez Jr., Victor Cha, Jennifer Jun
In Beyond Parallel
Interactive
Nampo Missile Test Stand Barge Update: Continued Intermittent Activity
June 9, 2022 | Joseph S. Bermudez Jr., Victor Cha, Jennifer Jun
In Beyond Parallel
On Demand Event
ROK-U.S. Strategic Forum 2022
June 6, 2022
On Demand Event
The Capital Cable #49: U.S.- Korea Tech Cooperation & Economic Security
June 2, 2022
View all content by this expert
Footer menu
  • Topics
  • Regions
  • Programs
  • Experts
  • Events
  • Analysis
  • Web Projects
  • Podcasts
  • iDeas Lab
  • Transcripts
  • About Us
  • Support Us
Contact CSIS
Email CSIS
Tel: 202.887.0200
Fax: 202.775.3199
Visit CSIS Headquarters
1616 Rhode Island Avenue, NW
Washington, DC 20036
Media Queries
Contact H. Andrew Schwartz
Chief Communications Officer
Tel: 202.775.3242

Contact Paige Montfort
Media Relations Coordinator, External Relations
Tel: 202.775.3173

Daily Updates

Sign up to receive The Evening, a daily brief on the news, events, and people shaping the world of international affairs.

Subscribe to CSIS Newsletters

Follow CSIS
  • Facebook
  • Twitter
  • LinkedIn
  • YouTube
  • Instagram

All content © 2022. All rights reserved.

Legal menu
  • Credits
  • Privacy Policy
  • Reprint Permissions