S. Korea Lists $2.62 Billion of Products to Buy in U.S.

The government Saturday released a list of $2.62 billion in U.S. products that South Korea plans to buy to keep its trade surplus with the United States down to about $7 billion and prevent American protectionist measures.

Officials said the purchases are crucial because the United States’ growing trade imbalances with other nations raise the possibility of import restrictions.

The announcement came five days after Commerce Secretary Malcolm Baldrige told a news conference here that the United States would be watching closely as Seoul implements the policy. Baldrige was here to seek more American access to Korean markets. The United States now buys 40% of South Korea’s exports.

The South Korean shopping list includes $2.144 billion in capital goods, raw materials and farm products to be imported by the private sector and $480 million in equipment to be bought by government agencies.

Low-Interest Loans

The government plans to provide $2.5 billion out of its foreign exchange reserves for low-interest loans to finance the purchases.

The private sector list includes $719 million in wheat, corn, soybeans and raw cotton, $700 million in machinery, electronic equipment and petrochemical plant facilities and $425 million in equipment to upgrade small- and medium-sized industries.

The list also includes $250 million in parts and raw materials for electronics and shipbuilding and $50 million for stockpiling raw materials, such as aluminum, zinc, polyethylene and cold-rolled steel sheets and plates.

The South Korean officials said the government will buy some of the machinery and industrial raw materials from the United States at the expense of imports from Japan.

The government also said it would widen the market for American goods and services, reduce tariffs, remove other import barriers and restrain some exports to improve the trade imbalance.

To increase U.S. sales in South Korea, the government said it will establish a service network for imported machinery, set up consulting offices to resolve difficulties in exporting to South Korea, hold a U.S. products show and send private sector buying missions to the United States.