The Free Trade Agreement between the United States and South Korea, called FTA KORUS, increased bilateral trade and investment flows.

It has been 10 years since this FTA first entered into force in 2012.

According to the South Korean government, data over the 10 years shows that the bilateral pact has been mutually beneficial to both sides in terms of trade and investment growth.

FTA and goods trade

While the trade in goods in both ways in 2021 increased 28.5% compared to the previous year, to 169.1 billion US dollars, these flows climbed 66.1% cumulatively, since 2012, when the FTA between South Korea and the United States came into force.

Thus, Korean exports of automobiles, auto parts, semiconductors, computers and petroleum products grew, and US exports of crude oil, semiconductor manufacturing equipment, natural gas, liquefied petroleum gas (LPG) and automobiles increased.

US market share for Korean products increased 0.1 percentage point to 3.4%, and Korean market share for US products fell 0.4 percentage point to 11.9%. Korea had a surplus of $22.7 billion in 2021.

Trade in services

Bilateral trade in services in 2020 fell 12.4% from the previous year, to 43.1 billion dollars, due to the Covid-19 pandemic.

Trade in services registered an average annual growth rate of 2.6% during the 2012-2020 period.

On the one hand, Korean services exports fell 3.3% to 17.4 billion dollars.

On the other hand, US services exports fell 17.9% to $25.7 billion.

With this, the United States had a surplus of 8.3 billion dollars in 2020.

FTA and foreign direct investment

According to the South Korean government, a total of $112.99 billion of Korean FDI has flowed into the United States in the period of 2012-2021 (as of the end of the third quarter of 2021), an increase of 282% compared to the period previous 10 years (2002-2011).

US FDI commitments to Korea were US$5.26 billion in 2021, and total pledged investments amounted to US$48.2 billion for 2012-2021, which is 98% more than in the previous 10 years.