"Tariff Relief Needed for Alliance" Letter... 'Korea's Son-in-law,' US Governor Urges Steel Negotiations with Han

"Renegotiate Export Volume Limits on Korean Steel Products"
EU, Japan Successfully Renegotiate with Biden Administration

[Image source=AP Yonhap News]

[Asia Economy Intern Reporter Kim Se-eun] Larry Hogan, Governor of Maryland, USA, who is called the "Son-in-law of Korea," has urged the federal government to "renegotiate" the export volume restriction clause on Korean steel products.

It was confirmed that Governor Hogan sent a letter on the 29th (local time) to Commerce Secretary Gina Raimondo and Katherine Tai, U.S. Trade Representative (USTR).

In the letter, he stated, "I applaud the recent agreements to ease tariffs on steel and aluminum with the European Union (EU) and Japan," and argued that "Korea, a high-quality steel supplier and key ally, should also be included in the discussions."

Governor Hogan's demand stems from concerns that Korea's competitiveness will weaken if neighboring countries' steel product export conditions to the U.S. improve, prompting trade authorities to request renegotiations, but the U.S. has shown a passive response.

In 2018, the Donald Trump administration imposed high tariffs on foreign products under Section 232 of the Trade Expansion Act to protect the domestic steel industry. A 25% tariff was applied to steel and 10% to aluminum.

At the same time, to avoid high tariffs, it was recommended to adopt a quota system limiting exports to 70% of the average volume of finished steel products produced from 2015 to 2017, and trade authorities accepted this.

As a result, the annual average export volume of Korean steel to the U.S., which was 3.83 million tons from 2015 to 2017, drastically decreased to around 2 million tons.

Regarding the Trump administration's handling, Governor Hogan evaluated it as "effective in strengthening U.S. manufacturing and creating jobs," but also argued, "At the same time, we must strive to create a framework to cooperate with allies to resolve non-market practices and stabilize supply chains."

The EU, Japan, and the UK, which did not adopt the quota system and paid high tariffs at the time, agreed to a Tariff Rate Quota (TRQ) system through renegotiations after the inauguration of the Joe Biden administration. (TRQ is a method that removes tariffs on a certain volume but imposes tariffs on volumes exceeding that.)

Governor Hogan also urged, "I call on not to delay similar negotiations with other major allies, including Korea."

In fact, on the 23rd of last month, Secretary Raimondo said, "Korea agreed with the previous administration (Trump administration) through quota adjustments, and renegotiation is not a high priority for us," indicating that U.S. trade authorities are effectively rejecting renegotiations.

Governor Hogan also pointed out the additional burdens and costs imposed on U.S. companies relying on Korean steel due to this agreement.

He emphasized, "If we do not start new discussions (with Korea), an unbalanced competitive situation may arise for manufacturers in our state that rely on Korean steel," and "Easing steel import tariffs from allies is essential to boosting job growth and investment not only nationwide but also in our state."

Meanwhile, Governor Hogan is nicknamed the "Son-in-law of Korea" domestically after marrying Mrs. Yumi Hogan, who is of Korean descent.

His term expires in January next year, and he is considered a leading Republican candidate in the 2024 U.S. presidential election.

This content was produced with the assistance of AI translation services.