U.S. International Trade Commission Finds FTA Would Substantially Affect U.S.-Korea Trade and Investment, Korea Pushes Ahead
On September 20, the U.S. International Trade Commission (ITC) released its report on the KORUS FTA. The ITC study is a required analysis under Trade Promotion Authority that explores the economic impact of a proposed trade agreement on the United States. Overall the study found that, if fully implemented, the FTA would substantially impact U.S.-Korea trade and investment. The study, which is available on the ICT’s website at www.usitc.gov, also provides detailed analysis of selected sectoral effects.
The ITC utilizes a constructed baseline for the U.S. economy in 2008 to analyze the marginal effect on the U .S. economy from the removal of the tariff and tariff-rate quotas in the FTA on the U.S. economy. It found that from its 2008 baseline:
· U.S. GDP would likely increase by $10.1–11.9 billion
· U.S. exports of goods to Korea would likely increase by an estimated $9.7–10.9 billion
· Korean exports of goods to the United States would likely increase by $6.4–6.9 billion
· U.S. consumers would benefit by $1.8–2.1 billion