WASHINGTON (Bloomberg) -- Automobile imports from South Korea may increase by almost $1 billion, more than four times greater than U.S. exports, under a free-trade agreement being considered by both nations, an independent government study concluded.
Even with revisions to the vehicle provisions negotiated by President Obama, imports of vehicles and auto parts from Korea would jump $907 million under the accord, and exports increase $194 million, according to a study released today by the U.S. International Trade Commission.
Exports to Korea would expand 54 percent compared with 11 percent for shipments from Korea, reflecting a lower U.S. tariff and an expected increase in Korean companies building cars at U.S. factories, according to the report.
Representative Dave Camp, a Michigan Republican and chairman of the House Ways and Means Committee who requested the report, said the findings underscore the need for Congress to approve the deal.
"This report shows how effective our trade agreements can be in removing both tariff and non-tariff barriers to U.S. exports," Camp said in a statement.
The government agency, which is independent of the Obama administration, said that exemptions from Korea environmental regulations granted by the Koreans in negotiations with Obama may help increase exports from Ford Motor Co. and U.S. carmakers.
Exports and imports of autos are lower than forecast in a 2007 report, reflecting a drop in trade between the two nations following the financial crisis in late 2008. The percentage change is in the same range, the ITC report said.