South Korean Free Trade Deal Goes into Effect

Earlier this week, a free trade agreement with South Korea went into effect. The Republic of Korea-United States Free Trade Agreement, also known as KORUS FTA, is the largest free trade agreement since NAFTA, the second largest free trade agreement the United States has entered (second only to free trade agreements with the European Union), and the first free trade agreement entered into with a major Asian economic power. The treaty with South Korea would eliminate 95 percent of each nation’s tariffs within five years.

The agreement has been in political limbo for years. First signed in 2007 by then President George W. Bush, the bill stalled in the Senate where some politicians raised concerns over the automobile and beef industries. The bill was renegotiated in 2010 by President Barack Obama and ratified on October 12, 2011.

While the agreement covers much more than agricultural products, the farm sector is largely pleased at the passage of the trade agreement. In a statement addressing the agreement, Secretary of Agriculture Tom Vilsack praised the bill. “Today is a monumental day for American farmers and ranchers. Under the new U.S.-Korea trade agreement, two-thirds of the tariffs imposed on U.S. food and agricultural products exported to South Korea are being eliminated. Over the next few years, as additional barriers fall and more U.S. businesses market products to Korea’s expanding economy, American agricultural exports should grow by $1.9 billion and help support nearly 16,000 jobs here at home. The trade agreement with Korea is the most significant for the United States in decades. Now the world’s 12th largest economy, with a GDP of over $1.4 trillion and a population of about 49 million, Korea is already the fifth largest export market for U.S. farm products.

To learn more about agricultural financing opportunities contact a Farm Plus Financial representative by calling 866-929-5585 or by visiting

Follow us on: Twitter

Written by: Justin Ellison / Farm Plus Staff Writer