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KORUS takes effect March 15; agricultural exports expected to increase.

The Office of the U.S. Trade Representative has issued a statement saying that South Korea has completed all the legal requirements needed for the South Korea-U.S. Free Trade Agreement (KORUS) to go into force March 15. After that date, almost 80 percent of U.S. exports of industrial products to Korea will become duty-free, including aerospace equipment, agricultural equipment, auto parts, building products, chemicals, consumer goods, electrical equipment, environmental goods, all footwear and travel goods, paper products, scientific equipment, and shipping and transportation equipment.

USTR also noted that under KORUS, Korea's $580 billion services market will be opened to U.S. companies and that nearly two-thirds of U.S. exports of agricultural products to Korea will become duty-free.

USTR Ron Kirk said the deal should support tens of thousands of U.S. jobs and help achieve the administration's goal of doubling exports by 2015.

"Entry into force of this agreement will open up Korea's $1 trillion economy for America's workers, businesses, farmers, and ranchers while also strengthening our economic partnership with a key Asia-Pacific ally," said Kirk in a statement.

Kirk also said the administration is "working equally diligently" with Colombia and Panama to ensure those deals go into effect in quickly.

The three agreements approved by Congress last fall "have the potential to add more than 70,00 jobs to our American economy," said Kirk, though he said that estimate is probably conservative because it doesn't take into account trade in services.

The American Soybean Association issued a statement pointing out that the FTA with South Korea "creates landmark opportunities for soybeans and other U.S. agricultural exports, including meat and poultry." ASA also notes that after March 15, U.S. food-grade soybean producers will have access to the South Korean market for the first time "outside of the import monopoly created by the Korean State Trading Enterprise."

The implementation of the agreement will also trigger the gradual elimination of tariffs on refined soybean oil over five years, and the elimination of tariffs on crude soybean oil over 10 years, says ASA.
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Publication:The Food & Fiber Letter
Geographic Code:9SOUT
Date:Feb 27, 2012
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