Korean trade minister says US-China trade dispute 'new normal'

Published : Sept 20, 2018 - 11:48 Updated : Sept 20, 2018 - 11:51

South Korea's trade minister Thursday urged local companies to develop high-value-added technologies and seek new growth drivers to embrace the protracted trade tension between the United States and China, calling it a "new normal."

Kim Hyun-chong expressed worries over the changing trade environment after Washington imposed a third wave of tariffs on $200 billion worth of Chinese goods and China responded with $60 billion duties on US imports. The US tariff is set at 10 percent and will rise to 25 percent next year unless the world's two largest economic powers reach a deal.

"Considering the bipartisan support in the US against the rise of China and Beijing's willingness to achieve the Chinese dream, we have to acknowledge the US-China trade dispute as a new normal and come up with measures to deal with it," Kim said during the meeting with representatives from trade promotion agencies and major industry associations, including the tech, auto, steel and petrochemical sectors.

(Yonhap)

"We have to upgrade major industries and foster new export items that are hard to catch up with and unaffected by the changing trade environment," Kim said.

The trade war between the US and China is a sensitive issue to South Korea as the two countries are its two largest markets, being major buyers of semiconductors, petrochemical products and cars.

Industry officials shared the consensus that the tit-for-tat tariffs would have a limited impact on their exports in the short term, but worried that a prolonged dispute could pose uncertainties and lead to an overall slowdown in global economic growth.

For sectors that heavily rely on foreign markets, like auto, trade fears could create foreign exchange fluctuations in emerging markets and affect the South Korean currency, they noted.

To minimize the repercussions from the trade war, the ministry and state-run trade promotion agencies vowed to expand support and step up overseas marketing efforts for South Korean companies.

The Korea Trade-Investment Promotion Agency said it will explore new business opportunities in promising markets, and the Korea Trade Insurance Corporation plans to expand insurance coverage to help them manage risks stemming from the rising protectionism. (Yonhap)