Wary of possible U.S. protectionist moves, South Korea plans to limit its trade surplus with the United States in 1987 to this year's level by increasing American imports, government officials said today.
Officials at the Trade and Industry Ministry said the government believes the United States would probably retaliate if the bilateral South Korean trade surplus grows larger next year.
They said the U.S. government fears more protectionist pressure in Congress now that the Democrats control both houses.
The officials said the trade surplus with the United States, South Korea's largest market, totaled $6.8 billion in the first 11 months of this year and is likely to exceed $7.2 billion for the year, up from last year's $4.2 billion.
More Than $10 Billion
Without government action the surplus could top $10 billion next year, they said.
The officials said the government's plans call for buying machinery, grains, coal and oil from the United States instead of other sources. South Korea so far has relied heavily on Japan for machinery and industrial materials.
They said the plans also call for opening the South Korean market to some agricultural products in response to U.S. demands, lowering tariffs on certain U.S. products and actively encouraging U.S. business investment in South Korea.
Trade and Industry Minister Rha Woong Bae has said the government plans to open the South Korean market more to U.S. goods "in an orderly manner" to try to avoid trade friction.
Accumulating a Surplus
He said it is no longer reasonable for South Korea to refuse U.S. requests for increased access to its market when South Korea is accumulating a bilateral trade surplus.
Earlier this year, South Korea allowed the import of U.S. cigarettes, opened the country's insurance market to some U.S. companies and agreed to protect U.S. property rights to try to ease U.S. protectionist pressures. However, U.S. officials have demanded additional access to the South Korean market.
Until recently, Seoul officials maintained that South Korea deserved special consideration because it was still a developing country with huge foreign debts, now totaling $45 billion, that had spent one-third of its national budget on defense.
However, paced by strong exports, particularly to the United States, South Korea's overall trade surplus is projected to grow to $3 billion and its current account surplus to $4.5 billion this year.