At a time when tensions in the Korean Peninsula are increasingly high, President Donald Trump is reportedly planning to end a free trade deal with South Korea
According to The Washington Post, which cited unidentified sources “close to the process,” the decision is far along but not final, although it could be announced next week.
The Wall Street Journal also reported Trump is considering pulling out the deal.
The White House confirmed to The Post that the deal is being discussed, but would not comment further.
The Post said some of Trump’s advisers are opposed to the move. It named national security adviser H.R. McMaster, Defense Secretary James Mattis and National Economic Council Director Gary Cohn as being against the deal ending.
South Korea has been working closely with the United States to oppose North Korea’s missile program, but that that partnership could be impacted if the nations begin a trade war.
The South Korean trade agreement has been in effect since 2012.
If the United States were to withdraw, goods imported from South Korea could cost more, because the U.S. could slap heavy tariffs upon them. Cars, cell phones and various electronic items are all major imports form South Korea.
U.S. action could spur a similar response from South Korea, making U.S. products more expensive in that country.
U.S. trade representative Robert E. Lighthizer said in July that since 2012, the U.S. “trade deficit in goods with Korea has doubled from $13.2 billion to $27.6 billion, while U.S. goods exports have actually gone down. This is quite different from what the previous Administration sold to the American people when it urged approval of this Agreement. We can and must do better.”
In June, Commerce Secretary Wilbur Ross made the administration’s concerns public as Trump sought to renegotiate the deal.
“There are a lot of very specific problems,” Ross told South Korean President Moon Jae-in on June 30.
“For many, many years, the United States has suffered through massive trade deficits….we’ll be changing that,” Trump said during his part of the June 30 meeting with Moon.
“The fact is that the United States has trade deficits with many, many countries, and we cannot allow that to continue,” Trump added at the time. “And we’ll start with South Korea right now.” (For more from the author of “Report: Trump Ready to Dump S. Korean Trade Deal” please click HERE)