Trump ups trade tensions with SKorea
WASHINGTON — President Donald Trump and South Korea’s new leader showed joint resolve on North Korea on Friday despite their divergent philosophies for addressing the nuclear threat, yet the U.S. opened up a new front of discord by demanding a renegotiation of a landmark 2012 trade pact between the two countries.
Concluding two days of meetings at the White House, Trump and President Moon Jae-in each delivered tough talk opposing North Korea’s development of atomic weapons that could soon threaten both allies.
The “reckless and brutal regime” requires a determined reply, Trump said. And Moon, who has long advocated outreach to Pyongyang, vowed a “stern response” to provocation, promising to coordinate closely with Trump as he looks to intensify economic and diplomatic pressure on North Korea.
While they avoided a potential conflict on the most burning national security crisis facing each country, they showed little harmony on trade.
Summoning the economic nationalism that has marked much of his international agenda, Trump highlighted America’s trade imbalance with South Korea. Two-way trade in goods and services was $144 billion last year, with the U.S. running a $17 billion deficit.
“The fact is that the United States has trade deficits with many, many countries, and we cannot allow that to continue,” Trump said. “And we’ll start with South Korea right now.”
Ahead of their first face-to-face discussions, South Korean companies announced plans to invest US$12.8 billion in the U.S. over the next half-decade. Nevertheless, Trump wasn’t placated. He said the two sides would renegotiate a 2012 free trade agreement, calling it a “rough deal” for America, echoing the sentiments he has voiced about the North American Free Trade Agreement with Canada and Mexico. The White House later confirmed Trump has asked his trade representative to begin the process of renegotiation.
Trump accused Seoul of helping steel reach the U.S. at unfairly low prices. It was an apparently reference to Chinese steel. Trump also demanded that market barriers to U.S. auto makers be lifted to give them “a fair shake at dealing with South Korea.”
To rub it in, Trump called on his top economic officials to address their grievances to Moon in front of journalists.
Commerce Secretary Wilbur Ross said the trade imbalance had grown sharply since the trade deal took effect due to unfair “rulemaking” governing U.S. industrial products entering South Korea, particularly autos.
It all amounted to an unusual display of one-upmanship in a meeting between close allies. After the talks, Moon largely skirted the differences on trade, calling the U.S.-South Korean economic partnership an “essential pillar” of the alliance. Such language is traditionally reserved for their joint effort in the 1950-53 Korean War and the ongoing presence of 28,000 U.S. forces in South Korea.
After the flood of accusations of South Korean wrongdoing, Moon said through an interpreter: “Economic growth and job creation will be promoted to ensure our peoples enjoy greater mutual benefits.”
South Korea is America’s seventh largest market for exported goods such as U.S. electrical machinery, aircraft, medical instruments and beef. It is also the sixth largest supplier of U.S. imported goods, benefiting Korean makers of cars, phones and pharmaceuticals.
Since the deal went into effect, American goods exports to South Korea have slipped 2.8 percent, according to the Office of the U.S. Trade Representative. At the same time, South Korean goods exports to the U.S. have boomed by 23.4 percent. U.S. services providers have fared better, with their exports climbing 29.3 percent in the last five years.
Earlier this week, Myron Brilliant, vice president of the U.S. Chamber of Commerce, warned that reopening the agreement “could lead to its unraveling,” benefiting only U.S. trade competitors.
Despite the trade tensions, Trump and Moon sought to establish a personal bond.
Moon praised the American as a man of “determination and pragmatism,” and said Trump had accepted an invitation to visit South Korea with first lady Melania Trump later this year. Trump declared their relationship “very, very good.”
And they revealed no disagreement on North Korea, though Trump harkened back to an election campaign demand for “fair burden-sharing,” with South Korea paying more for the U.S. military presence in its territory.
Trump urged all nations to join the U.S. in imposing sanctions to starve North Korea of resources for its nuclear and missile programs. He demanded North Korea “choose a better path and do it quickly, and a different future for its long-suffering people.”
“Our goal is peace, stability and prosperity for the region — but the United States will defend itself, always will defend itself — always,” Trump said. “And we will always defend our allies.”
Moon said the leaders agreed to strengthen their deterrence and coordinate on North Korea policy, employing both sanctions and dialogue “in a phased and comprehensive approach.” He urged Pyongyang to return to negotiations on ending its nuclear program, something it shows no sign of doing.
Before Friday’s White House talks, Moon laid a wreath at the Korean War Memorial monument near the Washington Mall. Vice President Mike Pence, whose father served in the U.S. Army during the Korean War, accompanied him. They observed a moment of silence as a lone trumpeter played “Taps.”
It was the second time on Moon’s trip he paid tribute to American veterans of the conflict. On Wednesday, he visited a memorial to Marines who in 1950 enabled a mass evacuation of Korean civilians. Those rescued included Moon’s parents.