Seoul: Despite a recently clinched tariff deal, South Korea and the United States have not been able to fully resolve issues related to non-tariff barriers, particularly in the agricultural and digital sectors, as the deal did not specify sensitive issues.
According to Yonhap News Agency, last Thursday, Seoul and Washington announced a long-awaited agreement under which the U.S. will impose a 15 percent tariff on South Korean imports, against the initially threatened 25 percent, in exchange for South Korea's investment of $350 billion in the United States.
Non-tariff barriers, including those involving the digital sector and quarantines on agricultural products, as well as foreign exchange and security matters, were excluded from the deal. A source close to the matter said the deal may "not solve the issues related to non-tariff barriers raised by the U.S." The source said Seoul could be under further pressure from Washington with regard to issues of non-tariff barriers.
Although negotiating a 15 percent tariff was a relative success for South Korea, comparable to the U.S. deals with Japan and the European Union, top South Korean officials cautioned that challenges would remain during further negotiations with Washington. "The real challenge lies ahead, as people say that the devil is in the details," Finance Minister Koo Yun-cheol told a press briefing in Washington after the deal.
"We will use the framework established in this agreement to develop concrete strategies and respond proactively in the upcoming detailed negotiations with the U.S.," he added. The two sides appeared to have focused on securing a broad agreement ahead of the Aug. 1 deadline set by U.S. President Donald Trump, while leaving contentious issues, such as non-tariff barriers in the agricultural and digital sectors, unresolved.
Accordingly, it remains highly likely that the U.S. will continue to push for the removal of non-tariff barriers, either during the upcoming summit between President Lee Jae Myung and Trump or other discussions on the implementation of the deal. South Korean officials made it clear that further opening of the Korean rice market was not discussed in the recently concluded trade deal, though White House spokesperson Karoline Leavitt said the trade deal provides market access to American rice, echoing U.S. President Donald Trump's earlier claim.
They also noted that U.S. demands concerning proposed regulations on online platforms and restrictions on the export of high-precision map data were also excluded from the deal. "Despite the deal, we cannot be complacent, as new tariff or non-tariff pressures might arise," Trade Minister Yeo Han-koo said.
"We need to take this agreement as an opportunity to improve our domestic systems that need adjusting so as to respond more proactively to potential tariff and non-tariff pressures from the U.S."