US, South Korea trade deal goes into effect

The free-trade accord between the United States and South Korea goes into effect Thursday, immediately eliminating thousands of tariffs and adding new protections for American businesses. 

The agreement, which passed by Congress in October, means that about 80 percent of U.S. exports of industrial products to Korea will become duty-free, including aerospace equipment, auto parts, consumer goods, all footwear, travel goods and transportation equipment. 

President Obama spoke with Korean President Lee Myung-bak on Wednesday about the agreement, thanking him for working together to complete the deal, the most commercially significant accord in nearly two decades.

The president heads to Seoul at the end of the month for a summit on nuclear security with other world leaders. 

U.S.Trade Representative Ron Kirk called the agreement "a landmark deal with an important ally."

"It was on the leading edge of President Obama’s drive to craft trade policy that addresses the real barriers that our exporters and workers face, and we are pleased that it will start generating benefits today in both the United States and Korea," he said in a statement. 

Tariffs cuts on goods in the deal are expected to support an estimated 70,000 U.S. jobs and increase exports to Korea by about $11 billion, according to USTR. 

Congress cleared the deals with Korea, Panama and Colombia on Oct. 12 — trade officials are still in talks over the other two agreements.

In addition, the U.S.-Korea deal eliminates duties on nearly two-thirds of U.S. agricultural products, including wheat, corn, soybeans for crushing, whey for feed use, cotton, cherries, pistachios, almonds, orange juice and wine. 

The agreement includes a number of non-tariff measures, including motor vehicle safety and environmental standards, enhanced regulatory transparency, technology neutrality and customs administration.  

Strengthened protections for intellectual property rights and commitments opening up Korea’s $580 billion services market also take effect, according to the administration. 

The trade deal had been in the works for several years and, in 2007, was readied by President George W. Bush for a vote in Congress. But it stalled because of disagreements between the White House and Democratic lawmakers.  

In December 2010, the president announced the resolution of outstanding issues.