Taiwanese industries must prepare themselves for the impact of an upcoming free-trade agreement (FTA) between the US and South Korea, which might hurt local business opportunities in the US market, the Bureau of Foreign Trade (BOFT) said.
Taiwanese businesses, particularly the textile, plastics and machinery sectors, which are more vulnerable to the US-South Korea FTA, should prepare themselves because South Korean goods will be able to enter the US market tariff-free once the agreement goes into effect, Bureau of Foreign Trade Deputy Director-General Chang Chun-fu (張俊福) told the Central News Agency on Friday.
The US levies tariffs ranging from 3 percent to 40 percent on imports of garments, shoes and bags.
The US-South Korea FTA is likely to be implemented by the end of this year after the two countries conclude their current negotiations.
Chang said according to an analysis by the bureau, the impact of the US-South Korea FTA will be much smaller than the EU-South Korea FTA that has been in effect since July, because the US already allows 60 percent of foreign products to enter the country with no tariffs.
Chang said the US-South Korea FTA will have the greatest impact on China because the US is the largest export market for Chinese goods.
Taiwan’s textile exports to the US are mainly special-purpose products, such as those made of carbon or PET bottles, he said.
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