10 years of Korea-US FTA... 63% increase in exports to the US 'driving force for export expansion'

[Financial News] Celebrating the 10th anniversary of the Korea-US Free Trade Agreement (FTA), exports to the US increased by 63% from 2012 to $959 in 2021, serving as a driving force for Korea's export expansion. This is significantly higher than Korea's global export growth (17%) over the same period. In particular, exports of Korea-US FTA preferential tariff items increased by 220.4% compared to 2012. Trade in services is also on the rise, and trade in telecommunications, computer and information services also soared by 283%. Korea's investment in the US has also increased by 282% cumulatively in the 10 years since the FTA went into effect.

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U.S. exports increased more than imports

The Ministry of Trade, Industry and Energy announced on the 14th that exports to the US increased by 63% from US$58.5 billion in 2012, when the FTA took effect, to US$95.9 billion in 2021, in an announcement of 'Korea-US FTA 10-Year Trade Trend'. The top five export items to the US, such as automobiles, automobile parts, semiconductors, computers, and petroleum products, also showed a marked increase. Over the same period, Korea's exports to the world only increased by 17.6% from $547.9 billion to $644.5 billion.

Imports from the US also increased by 69.0% from $43.3 billion in 2012 to $73.2 billion in 2021. Crude oil, semiconductor manufacturing equipment, natural gas, liquefied petroleum gas (LPG), and automobiles, which are the top five import items from the United States, also increased. On the other hand, world imports only increased by 18.3% from $519.6 billion to $615.1 billion during the same period.

Exports of Korea-US FTA preferential tariff items in 2021 amounted to US$41.27 billion, accounting for 43% of total exports to the US. This is a 220.4% increase compared to 2012 ($12.88 billion), when the Korea-US FTA preferential tariff application took effect. During the same period, exports to the US of items not subject to the FTA preferential tariff increased by 19.7%.

Imports of Korea-US FTA preferential tariff items in 2021 were $34.35 billion, up 215.4% from 2012 ($10.89 billion). During the same period, imports from the US of items not subject to preferential tariffs under the FTA only increased by 19.8%.

Korea and the United States are the largest service exporters

Service trade has increased by 2.6% compared to 2011 ($45 billion) before the FTA took effect, with an annual average of $46.2 billion for the nine years (2012-2020) after the FTA took effect.

Among them, trade in telecommunications, computers, and information services surged by 283.3% in 2020 compared to before the FTA took effect (2011).

As of 2020, the total amount of service exports to the US is $17.4 billion (-3.3%), and the US is Korea's largest service exporter.