After three months of talks,... South Korea and the U.S. have officially reached an agreement in principle on the terms of amending their FTA.
We have our business correspondent Kim Hyesung in the studio with us.
Hyesung, it seems both sides are happy with the concessions they've managed to squeeze out of each other...
Yeah, that's right.
Seoul's trade minister Kim Hyun-chong and U.S. Trade Representative Robert Lighthizer released a joint statement Wednesday night local time, saying the two countries were pleased to announce the amendment, which addresses issues on investment, tariffs and trade remedies.
This was somewhat expected, given that Trade Minister Kim announced last weekend at Incheon International Airport that the two sides had reached an agreement after weeks of back-to-forth flights to Washington for formal and informal talks.
The White House also said on Tuesday local time that the two sides had reached an agreement in principle.
What is surprising, however, is the speed of the trade negotiations.
The U.S. signaled its willingness to possibly amend the deal last summer, but Seoul and Washington formally started the talks in January, and came to a deal after just three months.
Look at NAFTA renegotiations,...it began last August, but the U.S., Canada, and Mexico have yet to come up with a tentative agreement on their 24-year-old-deal after six rounds of talks.
Yeah, you could argue that NAFTA is a much more complex and established deal... and there are also three parties involved with that one, but there's no denying this was quick. Why do we think it was all sorted out so fast?
Well,... there's a combination of factors.
President Trump had pledged to amend or scrap the free trade agreement during his election campaign, criticizing it as a horrible deal, pointing out America's trade deficit with South Korea.
So he wanted to wrap up the amendment soon to show his supporters before the mid-term elections in November.
South Korea also wants to lower uncertainty, with regards to trade with the U.S., its second largest trading partner,...and steel and aluminum tariff measures, as South Korea is the third largest steel exporter to the U.S.
In addition, the ongoing North Korea issue means closer cooperation from Seoul and Washington is needed, so the two wanted to wrap up the amendment soon.
In the joint statement, it actually said quote "This represents important progress in improving Korea-U.S. trade and economic relations, based on their strong and enduring security relationship."
And at the end of the day, both are somewhat satisfied with the deal, calling the deal "a win-win" for both sides.
Everyone is feeling good about the changes then. Just walk us through some of the specific amendments.
Yes, the amendments to the KORUS FTA address areas like investment, tariffs, trade in automobiles, and trade remedies.
Seoul has agreed to lift some its safety and environmental regulations, and allow U.S. automakers
