Donald Trump Halts FTA Deal With South Korea, North Korea To Blame

Forex News

The US and South Korea have recently agreed to revise their FTA (free trade agreement) with a side deal aiming to deter competitive currency devaluation by Seoul and open the South Korean market for U.S. auto- and drug makers. If the agreement doesn’t come into effect, the 25% US tariffs on imports of steel from South Korea are inevitable.

Donald Trump stated that the trade agreement with South Korea might come into effect only after he finishes talks about denuclearization with North Korea. The President claimed: "I may hold it up until after a deal is made with North Korea. You know why? Because it's a very strong card. And I want to make sure everyone is treated fairly".

The meeting with North Korea’s leader Kim Jong-Un is scheduled for the end of May. The US President seems hopeful about it, saying: "We're moving along very nicely with North Korea. We'll see what happens. Certainly the rhetoric has calmed down just a little bit".

Raj Shah (Principal Deputy Press Secretary) said: "The president, taking into account all relevant considerations - including negotiations with North Korea - will determine the best time to sign a finalized agreement on behalf of the United States". Paik Un-kyu (South Korea's Minister of Trade, Industry and Energy), in his turn, responded: "In terms of the negotiation schedule, we would have to review terms legally and finalize a draft... Both South Korea and the United States have their own domestic procedures, so we're not at a signing stage because those procedures take time”.