Government: "Will work with U.S. to keep 15% tariff... Section 301 is separate from non-tariff barriers" [U.S. launches Section 301 probe]

Korean trade authorities responded to the United States of America (U.S.) launching a Section 301 of the Trade Act of 1974 investigation on the 12th, stating they "will work with the U.S. to ensure that the balance of interests previously agreed between the two countries is maintained." They are expected to treat the 15% reciprocal tariff rate, agreed by the two sides last November, as a bottom line in their response. According to the authorities, the U.S. side also appears to be primarily seeking to restore tariff levels to where they were before the U.S. Supreme Court ruling that struck down reciprocal tariffs imposed under the International Emergency Economic Powers Act (IEEPA).
On whether this latest U.S. trade investigation could later be linked to non-tariff barriers such as digital trade issues or the Coupang case, the authorities drew a clear line, calling it "a separate matter."
Yeo Han-koo, Minister for Trade at the Ministry of Trade, Industry and Resources (MOTIR), held an emergency online briefing the same day. He said, "The U.S. goal is to preserve and maintain, as much as possible, the trade deal it had previously agreed to." He continued, "Previously, the reciprocal tariff rate was 15% for Korea, the European Union (EU) and Japan alike. We will do our utmost in consultations with the Office of the United States Trade Representative (USTR) and the United States Department of Commerce so that this balance of interests is upheld."
Yeo stated, "During the written comment period, we plan to coordinate closely with our industries and submit the government’s official opinion." He noted that Section 301 of the Trade Act of 1974 investigations usually take several months to about a year, but he expects the U.S. to move as quickly as possible in this case.
Yeo said, "Fundamentally, Section 301 of the Trade Act of 1974 is likely to focus on areas where the U.S. is running a trade deficit." He added, "In the course of the investigation and consultations, we plan to carefully examine those areas where Korea records a trade surplus and use various statistics and arguments to persuade the U.S. that these sectors actually help the U.S. economy and the rebuilding of U.S. manufacturing."
Asked whether this U.S. trade investigation could be linked to frictions over non-tariff barriers such as digital trade or to the Coupang case, Yeo explained that "it is unrelated to Section 301 of the Trade Act of 1974."
Yeo further clarified, "The announcement today concerns a Section 301 of the Trade Act of 1974 investigation focused on overcapacity. It is not targeting Korea alone, but is an inquiry into structural factors across 16 countries." He emphasized, "It is a Section 301 of the Trade Act of 1974 case that is separate from non-tariff barrier issues such as digital trade."
jhyuk@fnnews.com Kim Jun-hyuk Reporter