U.S. Warns S. Korea of Trade Retaliation

The United States will retaliate against South Korea unless it allows freer trade, Trade Representative Carla Anderson Hills said Friday.

“In the last 12 months, Korea has not been as constructive as it was the 12 months prior,” Hills said in a television interview.

“If we do not get a change in policy, we will certainly withdraw concessions that would otherwise be available to the Koreans,” she said in a taping for “American Interests,” a Public Broadcasting Service program to be shown today.

Hills did not elaborate and officials in her office were not immediately available for comment.

The United States has become increasingly concerned about South Korean trade policies in recent months. Of particular worry is a new campaign aimed at limiting imports of luxury goods.

U.S. exports to Korea have also slowed since last year and business groups are pressing the Administration to become more vigorous in its efforts to open the Korean market.

Hills criticized Korea for pushing the import policy at a time when other nations are trying to expand world trade.

“They have carried on sort of an anti-luxury import campaign. And luxury has been construed very broadly--appliances and the like,” she said. “Keeping your markets open is correct policy, regardless of what your local economy or your domestic economy is doing.”

During the interview, Hills also chastised Japan for its lack of cooperation in the 107-nation General Agreement on Tariffs and Trade talks.

She said the stalled GATT round could not resume unless the European Community compromised on farm subsidies.