KOSBI: "U.S. Tariffs Should Be Addressed Through Pragmatic Diplomacy... Asian Alliances Needed"

KOSBI: "Pragmatic Diplomacy Needed to Overcome Trump Tariffs"
Institute Recommends Strengthening Asian Alliances and Bilateral Trade Agreements
Emphasizes Cooperation Between Public and Private Sectors to Address Trade Surplus
Calls for Enhanced Market Access and Protection Against Global Protectionism
Warns of Risks from Chinese Capital and Stresses Supply Chain Support for SMEs
Advocates R&D Investment and Shift in Government Support Strategy

The Korea Small Business Institute (KOSBI) has emphasized that the United States' Trump administration's tariff measures should be overcome through "pragmatic diplomacy."

On April 24, KOSBI stated in its report, "Status of Major Countries' Responses to U.S. Trump Tariffs and Implications," that "measures toward the United States should be approached with caution, and responses should not involve providing unilateral benefits to the U.S." The institute added, "In particular, strengthening alliances among Asian countries can serve as positive leverage on the U.S. from Korea's perspective, and there is a possibility of reaching a bilateral trade agreement similar to the Phase One U.S.-China trade deal during Trump's first term."

KOSBI then proposed three approaches to mitigate the trade surplus with the United States. "The public and private sectors must cooperate to derive optimal negotiation conditions in terms of expanding imports from the U.S., reducing export dependence, and increasing investment," the institute said. "However, since the Trump administration tends to regard investment and trade surplus as separate concepts, alleviating the trade surplus with the U.S. should be set as a priority task," it advised.

KOSBI also stressed the need to accelerate efforts to expand market access for domestic companies and to prepare for the global rise of protectionism. "It is necessary to strengthen diplomatic efforts with state governments in the U.S. that have large volumes of manufacturing-centered exports and imports, in order to expand market access and ensure the stability of trade for Korean companies," the institute said. "Along with enhanced monitoring of low-priced Chinese product offensives and the imposition of anti-dumping tariffs, it is important to reduce dependence on the international trade environment and to take more proactive measures to protect domestic industries amid the global trend toward protectionism."

Furthermore, KOSBI noted, "As cases of Chinese capital acquiring Korean companies to circumvent U.S. sanctions on China are increasing, it is necessary to strengthen origin verification systems and continuously monitor the cross-border M&A market to avoid being implicated as a conduit for Chinese indirect exports."

The institute also stated, "By benchmarking the cases of Honda and Toyota in Japan, it is necessary to expand support for supply chain linkages between small and medium-sized enterprises with intermediate goods production bases in the U.S. and finished goods producers, as well as to form global consortiums among SMEs in similar industries, thereby strengthening supply chain construction and cooperation among Korean companies."

Finally, KOSBI emphasized the need to support research and development for SMEs and to shift the direction of government support. "At the micro level, research and development support should be strengthened for industries targeted by tariffs and those with large export volumes to enhance industrial competitiveness and target the premium market through the launch of high-end products," the institute said. "At the macro level, government support should move beyond the existing strategy of pursuing comparative advantage and economic efficiency in new technology sectors, and instead shift to a new strategy aimed at achieving absolute advantage and high added value."

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