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South Korea to request exemption from U.S. steel tariffs

By Jennie Oh
South Korea to request exemption from U.S. steel tariffs
South Korean Trade Minister Kim Hyun-chong headed to Washington on Tuesday to seek an exemption on potential tariffs on Korean steel. Photo by Yonhap.

SEOUL, March 6 (UPI) -- South Korea will request an exemption from heavy tariffs that the United States is expected to impose on imports of foreign steel.

Seoul's trade ministry said Tuesday that Trade Minister Kim Hyun-chong sent a letter to U.S. Commerce Secretary Wilbur Ross to exclude South Korea from import restriction measures under Section 232 of the Trade Expansion Act, Asia Today reported.

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The ministry did not reveal further details except that that Seoul proposed resolving pressing trade issues and moving forward in "future-oriented cooperation."

This comes after the U.S. Department of Commerce submitted a recommendation to President Donald Trump, suggesting heavy tariffs on foreign steel to protect domestic industries.

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South Korea was included in one of the options that imposed a 53 percent duty on a dozen steel exporting countries.

Another option proposes a 24 percent tax on tariff on all foreign steel. Trump on Thursday suggested raising the rate to 25 percent.

While Ross said on Sunday that there had not been any mention of exemptions for particular countries, Trade Minister Kim Hyun-chong left for Washington D.C. on Tuesday to discuss the matter with U.S. officials.

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Kim is expected to meet U.S. Trade Representative Robert Lighthizer and Senator Orrin Hatch during his four-day trip, Yonhap reported.

South Korea exported 3.6 million tons of steel products to the U.S. last year, becoming the third largest source of steel after Canada and Brazil, according to the US Department of Commerce.

However, shipments of South Korean steel to the U.S. have substantially declined over the years, by 3.9 million tons between 2013 and 2016.

Further reducing the numbers could affect some 33,000 American jobs provided by South Korean steel companies which have invested some $5.7 billion in the U.S.

Also, while Washington has expressed concern about the amount of Chinese steel contained in South Korean steel products, Trade Minister Kim says only 2.4 percent of steel products to the U.S. contain steel materials from China.

The trade minister also stressed, during previous meetings with U.S. officials, that restricting foreign steel would hurt America's downstream industries as well as U.S. consumers due to higher costs.

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