Date: Apr 03, 2012
Last month the United States and South Korea implemented a new free trade agreement ("FTA") that will likely have substantial benefits for the chemical industry. The most direct benefit is that numerous chemicals and related products can now be imported into South Korea from the United States duty-free. As a result, the already robust chemical trade with South Korea ($6.6 billion U.S. exports in 2011, a 60% increase since 2005) will likely expand.
Examples of duty rates that fell from as much as 6.5% to 0% include those for certain resins (HTS 3210002020, 3907500000 and 3909101000 through 3909400000), vinyl chloride copolymers (HTS 3904400000) and certain cellulosic compounds (3912391000 and 3912901000). In addition, duties on many South Korean chemical imports that were not eliminated immediately are scheduled to be reduced to zero over the next fifteen years.
Other benefits that the chemical industry will receive under the FTA include a requirement that South Korean laws treat U.S. companies as favorably as domestic companies, elimination of a requirement that senior management be comprised of South Korean nationals and new opportunities in government contracting.