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(LEAD) S. Korea expresses regrets over U.S. steel tariffs, mulls WTO complaint

2018/03/09 11:45

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(ATTN: CHANGES headline, lead; UPDATES throughout with more details, comments; ADDS comments)

By Kim Eun-jung

SEOUL, March 9 (Yonhap) -- South Korea's trade minister on Friday expressed regret over the decision by the United States to slap stiff tariffs on steel imports, saying the nation will consider filing a complaint with the World Trade Organization (WTO) if it is not exempted.

Paik Un-gyu, minister of trade, industry and energy, made the remark after U.S. President Donald Trump ordered new tariffs of 25 percent be slapped on all steel imports with the exception of those coming from Canada and Mexico.

"We express regret over the U.S. government's decision to impose tariffs on imported steel even though the Korean government has pointed out the problems of this action through various channels," Paik said in a meeting with senior officials from Korean steelmakers. "If this action takes effect, it would inevitably deal a serious blow to South Korea's steel exports to the U.S."

   South Korea shipped 3.6 million tons of steel products to the U.S. last year, making in the No. 3 steel exporter after Canada and Brazil, according to the U.S. Department of Commerce.

Paik Un-gyu, minister of trade, industry and energy, speaks during a meeting with senior officials from Korean steelmakers at the Convention and Exhibition Center (COEX) in Seoul on March 9, 2018. (Yonhap) Paik Un-gyu, minister of trade, industry and energy, speaks during a meeting with senior officials from Korean steelmakers at the Convention and Exhibition Center (COEX) in Seoul on March 9, 2018. (Yonhap)

Seoul has repeatedly asked the Trump administration to exempt it from the steep tariffs, citing close economic and security ties between the two nations and sending Kim Hyun-chong, the key man on trade policy, to Washington D.C. for closed meetings with senior American officials and policymakers in the run-up to the formal announcement.

Paik said the Korean government will continue to consult with the Trump administration to get an exemption or exclude some products from the high duties, while looking for ways to challenge the move at the WTO if its demands are not accepted.

"In parallel with the state-level effort, I ask for Korean companies to reach out to American clients and policymakers to secure the list of products that should be excluded," Paik said. "We will also actively consider taking group action with other countries affected by the latest move."

   With the new tariffs set to take effect in 15 days, Trump left room for exemptions for other countries, saying, "I'll have a right to drop out countries or add countries. I just want fairness."

   South Korea is expected to bring up the steel tariffs in upcoming talks to revamp the free trade agreement (FTA), as Trump exempted Canada and Mexico from the tariffs in hopes of getting a better deal for a new North American Free Trade Agreement (NAFTA).

"As (the U.S. steel) tariffs are imposed while the two-way South Korea and U.S. FTA renegotiations are underway, we will consult with the U.S. to minimize their impact (on South Korean companies)," Paik told reporters ahead of the meeting.

The two nations are expected to hold the third round of FTA talks in Washington later this month.

In the second meeting, Seoul complained about rising U.S. trade remedies, including steep safeguard duties on its washers and solar panels, while American negotiators called for an easing of regulations on the auto sector to reduce its trade deficit.

The government will also make concerted efforts with trade promotion agencies and state-run utility firms to diversify the export market while pushing for large infrastructure projects to boost domestic consumption of steel products.

"In the long term, we will push for development of high-value added materials to restructure the steel industry and provide incentives to local companies to raise their competitiveness," Paik said.