South Korea continues to profit from its bilateral trade with the United States, but its trade surpluses largely come from outbound shipments of intermediate goods needed by U.S. manufacturers to produce their own finished goods, making their trade both complementary and mutually beneficial, a report said recently.
According to the report from the Korea International Trade Association (KITA), intermediate products accounted for 46.3 percent of overall South Korean exports to the U.S. in 2015, when such goods accounted for only about 37 percent of the United States’ total imports.
Such a high ratio of intermediate goods may indicate that South Korea was shipping items mostly needed by the U.S., it noted. The report comes amid a move by the new U.S. administration to consider imposing what it calls border adjustment tax, citing its country’s chronic trade deficits with key trading nations, including South Korea.
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