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South Korea has been granted a U.S. tariff waiver, becoming the only country in the world that has f

  • Author:Cynthia
  • Release Date:2018-05-05
  United StatesThe White House issued a statement on April 30 local time that President Trump approved the amendment to Article 232 of the "Trade Expansion Act."

Korea has become the only country in the world that has fully enjoyed tariff exemption in seven countries such as Canada, Mexico, and the European Union where the United States has suspended high tariffs. However, the United States imposes restrictions on the total amount of imported steel in South Korea.

According to media reports, the amendment has agreed to exempt 25% of the high tariffs on steel products produced in South Korea, but at the same time South Korea needs to control the total amount of steel products exported to the United States at 2.68 million tons (from 70 to 2015, the average export volume of 70 %)the following.

The EU and other countries are not so fortunate. South Korea won the US tariff exemption, and Trump has only delayed the period of tariff increases on the EU and other countries. The EU and Japan are still negotiating with the United States.

German Chancellor Angela Merkel also made a remark against Trump. If the EU is hit by U.S. tariffs, the EU will immediately respond.

According to industry sources, the Korean government has obtained an export quota equivalent to 111% in 2017 on sheet steel products, but only 51% of steel products such as oil-well steel pipes in South Korea's other major export products. quota.

In other words, South Korea exported a total of 2.03 million tons of steel pipes in 2017, and it can only export 1.04 million tons this year. This is a blessing for POSCO (Pohang Steel), which does not export steel pipes for major export of sheet metal products, but companies such as SeAH and Nexteel, which mainly export steel pipes, will inevitably be hit.

In this case, the recently convened South Korea Steel Steel Pipes Consortium also failed to reach a quota allocation agreement for total exports among various companies. Moreover, with POSCO chairman Wu Jujun intending to resign, the president of the iron and steel association he will serve will also be vacant, lacking the leader to coordinate the interests of the industry.

According to the report, the overseas operations of South Korean companies have actually been stagnant. Since the export of steel pipes is often a one-time signing of large-scale long-term export contracts, it is difficult for companies to conduct business activities autonomously before the final quota is determined.

A related person in the iron and steel industry said, “The domestic companies have not yet reached an agreement on quotas. Under such circumstances, they have rashly signed export contracts and are likely to lose more than gain, so they cannot start operating.”