Former USTR Deputy Representative: "If Trump Imposes 10% Tariff on Korea, It Violates FTA"

Former U.S. President Donald Trump’s proposal to impose a 10% tariff on all imports under a second term administration, known as the 'Universal Basic Tariff,' would violate the Korea-U.S. Free Trade Agreement (FTA), according to trade experts.

[Image source=Yonhap News]

Wendy Cutler, Vice President of the Asia Society Policy Institute (ASPI) and former Deputy U.S. Trade Representative (USTR), stated at a briefing with Korean correspondents in Washington D.C. on the 22nd (local time), "To be clear, this would violate our obligations under the FTA." Earlier, former President Trump declared a trade war, pledging to impose a 10% tariff on all imports if he wins the upcoming November election and returns to power.

Cutler, who was the chief U.S. negotiator during the 2006 Korea-U.S. FTA negotiations, noted that it is uncertain whether such tariffs would be applied to countries like Korea that have FTAs with the U.S., but if applied to Korea, it would be a "violation of the Korea-U.S. FTA." She explained, "According to the FTA agreement, arbitrarily raising tariffs between the two partners is not allowed." Referring to the fact that former President Trump revised the Korea-U.S. FTA during his tenure, she added, "Even if there are flaws found in the Korea-U.S. FTA, you cannot blame the previous administration."

Cutler predicted that if such a universal basic tariff becomes a reality, it would "cause significant damage to the multilateral trading system" and make it difficult for the U.S. to seek cooperation from allies and partners in its strategy to counter China. She advised, "Every country should closely examine the (trade) tools that the Trump administration might use against them and find ways to mitigate the impact of such measures."

She also pointed out that former President Trump might raise issues about Korea’s trade surplus with the U.S. after taking office again. She said, "It is concerning that Trump continues to emphasize the trade deficit. During his first term, the trade deficit with Korea was decreasing, which the Trump administration welcomed, but in recent years, especially due to automobiles and semiconductors, the trade deficit with Korea has been increasing." She explained, "Trump strongly believes that trade deficits are bad. He thinks that if we buy more from a country than we sell to it, that relationship is against our interests and that trade balances should be maintained with trading partners."

She rated former President Trump’s chances of winning the November election highly. Additionally, she predicted that the trade war, including the universal basic tariff, would cause severe decoupling between the U.S. and China. She said, "If former President Trump succeeds in his re-election, decoupling with China will expand. People say decoupling is risky, but discussions about decoupling will become active again."

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