The Korea-US Free Trade Agreement, or KORUS FTA, is an international trade agreement between the United States and South Korea. It was signed in 2007 and implemented in 2012. The agreement has had a significant impact on trade between the two nations, with South Korea becoming the USA’s sixth-largest trading partner.
One of the key aspects of the KORUS FTA is the preference criterion. This criterion states that both countries must provide preferential treatment to each other’s goods and services. It means that certain products from one country can be imported into the other country without having to pay tariffs or other trade barriers.
The preference criterion applies to a wide range of products, including agricultural and industrial goods, as well as services. For example, under the KORUS FTA, South Korea and the United States have eliminated tariffs on over 95% of goods traded between them. This has led to increased trade in goods such as cars, electronics, and chemical products, amongst others.
The preference criterion also applies to services, with both countries making commitments to reduce restrictions on service providers. This has led to increased trade in financial, telecommunications, and professional services, amongst others.
However, it is important to note that the preference criterion does not apply to all products. Certain products are excluded from preferential treatment, including sensitive agricultural products, textiles, and clothing. These products are subject to specific rules of origin, which determine whether they qualify for preferential treatment under the KORUS FTA.
The preference criterion also includes provisions to ensure that both countries maintain high standards in areas such as labor and environmental protection. The agreement includes commitments to promote and enforce labor rights, improve working conditions, and protect the environment.
In conclusion, the preference criterion is a crucial aspect of the KORUS FTA. It provides preferential treatment to certain goods and services traded between the United States and South Korea, leading to increased trade and investment between the two nations. However, it is important to note that the criterion does not apply to all products, and certain products are subject to specific rules of origin. The agreement also includes commitments to maintain high standards in areas such as labor and environmental protection.