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분야
docx1. Introduction
2. Impacts on US
3. Impacts on Korea
4. Threats and Countermeasures
5. Conclusion
6. Reference
1) The Reason We Chose Automobile Sector as Subject
Economic integration is one of the main issues in global economy. Economic integration removes the barriers of trade, so it could create trades, help get the economies of scales and stimulate technological progress as the scale of market increases. However the importance of this traditional motivation is getting weak and weak; according to the report by WTO in 1995, average tariff rate falls from over 40% in 1940s to 6.3% before Uruguay Round. Even it is expected to fall more to 3.8% after Uruguay Round. In spite of this reason, why does regional economic integration increase? The most important reason is that the multinational negotiations in WTO have some limits: the range and the speed. Regional or mutual negotiation is faster and deeper.
Our group chose Korea US (KORUS) Free Trade Agreement among them. The KORUS FTA concluded on April 2nd 2007 after 8 times negotiation round. Particularly, in this paper, we particularly focus on its effect on automobile sector, the number one exporting item from Korea to US. There are three main reasons for this; first, it is the number one exporting item from Korea to US. Secondly, it has a great ripple effect on other industries; especially its backward linkage effect. Numerically, if production cost in automobile industry increases by 100,000,000 won, it induces 85,000,000 won of production. Lastly, it has great weight on national economy in fields of output, employment, export, et cetera.
1) “U.S.-Korea Free Trade Agreement: Potential Economy-wide and Selected Sectoral Effects” United States International Trade Commission
2) “The Proposed U.S.-South Korea Free Trade Agreement (KORUS FTA): Provisions & Implications” CRS Report for Congress
3) “KORUS Free Trade Agreement and its impact on Korean automobile business sector” Yelin Hwang, Graduate School of International Studies, Korea University, 2007
4) A Study on the Influence of Korea Automotive Industry by Korea-USA FTA, Lee Chang-Hee, Changwon National University, 2008
