The US and South Korea have agreed in principle on revisions to a free trade agreement which first entered into force in 2012.
Senior White House officials on Tuesday said Washington will exempt Seoul from its steel tariffs and maintain the 10 per cent tariffs on imports of South Korean aluminium, the New York Times reported.
According to the officials, the US can maintain a 25 per cent tariff on imported pickup trucks until 2041. Under their original trade deal, Washington must gradually reduce the 25 per cent tariff to zero by 2021.
South Korea agreed to double the import quota for American-made cars meeting US safety rules to 50,000 per manufacturer each year, up from the current 25,000 units.
Seoul also agreed to include American pharmaceutical manufacturers in its national health programme's premium reimbursement plan.
In addition, both sides were working on a currency agreement dealing with currency practices, which will be finalized by robot provision that will prohibit a competitive currency devaluation and ensure transparency and accountability of monetary policy, said the officials.
In exchange, South Korea will be exempted from the 25 per cent tariff on its steel exports to the US. However, it agreed to limit the amount of steel it can export each year to the US to 70 per cent of its annual average from 2015 to 2017.
The agreement represented the first renegotiation of an existing trade deal in the Trump administration, part of a central campaign promise he made as a candidate.
On March 8, vowing to protect the US steel and aluminium industry in the name of national security, Trump signed proclamations to impose a 25 per cent tariff on imported steel and a 10 per cent tariff on aluminium.
But he has given temporary exemptions to Canada, Mexico, Argentina, Australia, Brazil, South Korea and the European Union in view of the ongoing negotiations with these economies.
French President Emmanuel Macron lashed out at Trump's approach, saying he was frustrated by the seemingly coercive negotiation tactics coming from Washington.
"We talk about everything, in principle, with a friendly country that respects the rules of the W.T.O.," Macron said. "We talk about nothing, in principle, when it is with a gun to our head."
--IANS
soni/mr
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