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South Korea

Sabina Neumann
(202) 205-3000
Sabina.Neumann@usitc.gov

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Change in 2017 from 2016:

  • U.S. total exports to South Korea: increased by $6 billion (14 percent) to $48.3 billion
  • U.S. general imports from South Korea: increased by $1.3 billion (2 percent) to $71.2 billion
  • U.S. trade deficit with South Korea: decreased by $4.7 billion (17 percent) to $22.9 billion

U.S. Total Exports

U.S. total exports to South Korea increased by $6 billion (14 percent) to $48.3 billion in 2017, a five-year high. The two sectors that contributed the most to the growth in total exports in 2017 were machinery (up $3.1 billion, 55 percent) and energy-related products (up $2.5 billion, 143 percent). Total export growth of 14 percent was offset slightly by a decline in some sectors, principally by a decline of $2.3 billion in exports of transportation equipment.

Table KR.1: Korea: U.S. total exports, general imports, and merchandise trade balance, by major industry/commodity sectors, 2013–17

 
Million $
 
Item
2013
2014
2015
2016
2017
Absolute change,
2016–17
Percent
change,
2016–17
U.S. total exports:
 
 
 
 
 
 
 
    Agricultural products
5,837
7,511
6,747
6,842
7,473
631
9.2
    Forest products
866
890
826
791
788
-3
-0.4
    Chemicals and related products
7,163
7,436
6,905
6,532
7,155
622
9.5
    Energy-related products
1,560
2,148
1,392
1,733
4,211
2,477
142.9
    Textiles and apparel
409
391
380
316
310
-6
-2.0
    Footwear
94
88
74
53
45
-8
-14.5
    Minerals and metals
4,081
3,696
3,214
2,556
2,603
47
1.9
    Machinery
5,943
6,817
6,231
5,622
8,700
3,078
54.8
    Transportation equipment
6,382
6,151
7,847
8,584
6,308
-2,275
-26.5
    Electronic products
7,974
8,022
8,388
7,653
9,110
1,457
19.0
    Miscellaneous manufactures
768
811
823
989
863
-126
-12.8
    Special provisions
571
686
656
638
711
73
11.5
        Total
41,649
44,650
43,484
42,309
48,277
5,967
14.1
U.S. general imports:
 
 
 
 
 
 
 
    Agricultural products
638
673
739
810
844
34
4.2
    Forest products
540
616
578
544
537
-7
-1.2
    Chemicals and related products
5,030
5,858
6,225
8,511
7,544
-966
-11.4
    Energy-related products
3,035
3,067
2,922
2,266
2,874
609
26.9
    Textiles and apparel
1,313
1,331
1,326
1,271
1,234
-37
-2.9
    Footwear
23
18
22
27
45
17
63.7
    Minerals and metals
5,550
7,716
6,908
5,309
5,819
509
9.6
    Machinery
6,635
7,110
7,579
7,068
7,895
828
11.7
    Transportation equipment
20,868
23,960
27,015
25,314
25,304
-10
(a)
    Electronic products
16,701
17,379
16,167
16,550
16,813
263
1.6
    Miscellaneous manufactures
828
821
895
968
888
-80
-8.2
    Special provisions
1,212
1,128
1,380
1,243
1,366
123
9.9
        Total
62,370
69,677
71,758
69,881
71,164
1,283
1.8
U.S. merchandise trade balance:
 
 
 
 
 
 
 
    Agricultural products
5,199
6,839
6,008
6,032
6,629
597
9.9
    Forest products
326
274
248
247
251
4
1.4
    Chemicals and related products
2,133
1,578
680
-1,978
-390
1,589
80.3
    Energy-related products
-1,474
-918
-1,530
-532
1,337
1,869
(b)
    Textiles and apparel
-904
-940
-946
-955
-924
30
3.2
    Footwear
71
70
51
26
1
-25
-98.0
    Minerals and metals
-1,469
-4,020
-3,694
-2,754
-3,216
-462
-16.8
    Machinery
-691
-292
-1,348
-1,446
805
2,250
(b)
    Transportation equipment
-14,486
-17,809
-19,169
-16,730
-18,995
-2,265
-13.5
    Electronic products
-8,726
-9,357
-7,779
-8,897
-7,703
1,194
13.4
    Miscellaneous manufactures
-59
-10
-72
21
-25
-47
(b)
    Special provisions
-641
-442
-724
-606
-655
-49
-8.2
        Total
-20,722
-25,027
-28,273
-27,572
-22,887
4,684
17.0

Source: Compiled from official statistics of the U.S. Department of Commerce.
Note: Import values are based on customs value; export values are based on free along ship value, U.S. port of export. Calculations based on unrounded data. Sectors are ordered by the level of processing of the products classified therein.
      aLess than 0.05 percent.
      bNot meaningful for purposes of comparison.

South Korea has a well-developed and growing economy, fueled in part by growing exports of electronics and semiconductors. To make these goods, the country’s supply of industrial machinery has needed to grow as well. Thus, South Korea’s machinery sector[1] accounted for the second-largest share (18 percent) of total U.S. exports to South Korea in 2017 and accounted for the largest absolute increase in the value of U.S. total exports. South Korea was the fourth-largest market for U.S. exports of machinery and the largest market for U.S. exports of semiconductor manufacturing equipment. U.S. machinery sector exports to South Korea rose primarily as a result of a significant increase in shipments. U.S. exports of semiconductor manufacturing equipment to South Korea increased 100 percent between 2016 and 2017 (from $3.1 billion to $6.2 billion).[2] 

As a major semiconductor producer, South Korea has been a leading U.S. export market for semiconductor manufacturing equipment for the past five years. Two South Korean firms, Samsung Electronics and SK Hynix, account for 70 percent of the global memory chip market.[3]  Demand for semiconductors is driven by growing global demand for downstream products such as communication and electronic devices, computers, and industrial and automotive electronics that include semiconductors as inputs.[4] Rising dynamic random-access memory (DRAM) prices also contributed to South Korean demand for semiconductors and the machinery to manufacture them.[5] While South Korea is a leading producer of both the semiconductors that are incorporated into downstream products and the downstream products (like consumer electronics) that rely on semiconductors as key inputs, South Korea is not a leading producer of semiconductor manufacturing equipment.[6]  American companies are leaders in the semiconductor manufacturing equipment sector and account for a 47 percent share of the world market. [7] These companies are well established as suppliers in the South Korean market and rely on exports.[8]  South Korean firms’ continued investment in semiconductor manufacturing and in upgrading fabricating equipment contributes to U.S. exports of these products.[9]

The energy and related products sector accounted for $4.2 billion (9 percent) of total U.S. exports to South Korea, but represented the largest percentage increase in exports (143 percent) in 2017, an absolute increase of $2.5 billion.[10] South Korea was the seventh-largest market for U.S. exports of all energy products, but the fifth-largest market for both U.S. crude petroleum and U.S. natural gas products in 2017. South Korea is one of the world’s largest energy consumers, and due to insufficient domestic energy reserves, it is heavily dependent on energy imports to meet demand. South Korea ranks among the world’s top importers of natural gas, coal, crude petroleum and refined products, and its demand is growing.[11]  Because it has no cross-border oil or gas pipelines, South Korea relies primarily on tanker shipments to deliver its liquefied natural gas (LNG) and crude petroleum imports.[12]

Table KR.2: Korea: Leading changes in U.S. exports and imports, 2013–17

 
Million $
 
Item
2013
2014
2015
2016
2017
Absolute change,
2016–17
Percent
change,
2016–17
U.S. total exports:
 
 
 
 
 
 
 
    Increases:
 
 
 
 
 
 
 
        Energy-related products:
Crude petroleum (EP004)
0
74
58
181
1,122
941
520.8
            Natural gas and components (EP006)
73
234
496
897
1,815
918
102.4
        Telecommunications equipment (EL002)
435
364
413
621
1,326
705
113.4
        Non-metalworking machine tools (MT018)
21
17
10
22
20
-2
-8.6
    Decreases:
 
 
 
 
 
 
 
        Aircraft, spacecraft, and related equipment (TE013)
3,289
2,871
4,430
5,192
3,327
-1,865
-35.9
    All other
37,831
41,090
38,077
35,397
40,667
5,270
14.9
        Total
41,649
44,650
43,484
42,309
48,277
5,967
14.1
U.S. general imports:
 
 
 
 
 
 
 
    Increases:
 
 
 
 
 
 
 
        Petroleum products (EP005)
2,846
2,906
2,805
2,204
2,811
608
27.6
        Steel mill products (MM025)
3,058
4,303
3,483
2,347
2,787
439
18.7
        Semiconductor manufacturing equipment (MT019A)
497
831
513
440
790
350
79.4
    Decreases:
 
 
 
 
 
 
 
        Medicinal chemicals (CH019)
68
112
291
2,474
1,293
-1,181
-47.7
        Motor vehicles (TE009)
12,147
14,577
17,282
16,071
15,734
-337
-2.1
    All other
43,754
46,947
47,384
46,345
47,748
1,403
3.0
        Total
62,370
69,677
71,758
69,881
71,164
1,283
1.8

Source: Compiled from official statistics of the U.S. Department of Commerce.
Note: Import values are based on customs value; export values are based on free along ship value, U.S. port of export. Calculations based on unrounded data.

The value of U.S. exports of energy-related products to South Korea increased from $1.7 billion in 2016 to $4.2 billion in 2017 (a 143 percent increase). Within the energy sector, crude petroleum and natural gas products led this export growth.[13] U.S. exports of crude oil from petroleum jumped by $941 million, a 521 percent increase over 2016, due in part to the removal of restrictions on U.S. exports of crude oil in late 2015. [14] Total U.S. crude exports increased from 216 million barrels in 2016 to 408 million barrels in 2017; U.S. crude exports to South Korea grew from 4 million barrels in 2016 to 21 million barrels in 2017.[15] Expanded infrastructure that came online in 2017 included several new or expanded U.S. pipelines that facilitate crude oil transport from inland production regions to the Gulf Coast for shipping to overseas markets.[16] In addition, expanded port infrastructure along the U.S. Gulf Coast and along the Mississippi River also made larger volumes of crude oil exports possible.[17] Favorable global benchmark pricing (between Brent crude and West Texas Intermediate crude oil) also made U.S. crude oil prices more attractive, spurring U.S. exports.[18] Finally, the South Korean government introduced tax incentives to encourage South Korean refiners to purchase crude oil from suppliers outside the Middle East.[19]     

U.S. exports of natural gas and components to South Korea increased by $918 million (102 percent), driven largely by a $574 million increase in LNG exports. South Korea is the world’s second-largest LNG importer,[20] and in 2017, South Korea became the second-largest market for U.S. exports of LNG, accounting for 17 percent of total U.S. LNG exports.[21] South Korea meets all of its natural gas demand through LNG imports and prefers to purchase under long-term contracts with prices linked to the oil market.[22] U.S. exports to South Korea were part of long-term contracts between two sellers—Cheniere Energy and Shell—and South Korean natural gas buyers, primarily South Korean utilities. Favorable price differentials between LNG price benchmarks helped drive increased LNG exports from the United States to South Korea.[23]  South Korean demand for LNG was also partly boosted by domestic policy decisions to lessen dependence on coal and nuclear energy.[24]  On the supply side, domestic capacity expansion at Cheniere’s U.S. LNG export terminal in Louisiana also contributed to export growth.[25]  All U.S. LNG exports in 2016 and 2017 came from the Louisiana terminal (Sabine Pass), which started up in February 2016 with a capacity of 0.7 billion cubic feet per day and had expanded to 2.8 billion cubic feet per day by the end of 2017.[26]

The overall increase in total U.S. exports to South Korea was partially offset by a 27 percent decline in U.S. exports of transportation equipment (from $8.6 billion in 2016 to $6.3 billion in 2017).[27] Although its imports from the U.S. declined in 2017, South Korea remained the 13th-largest market for U.S. exports of transportation equipment. The decline in transportation sector exports in 2017 was primarily driven by a spike in those exports the previous year—namely, a $1.1 billion defense contract purchase of new military helicopters that was mostly completed in 2016. Because of its long-standing military alliance with the United States and a large U.S. military presence in South Korea, most South Korean defense systems are based on U.S. standards, which in turn affect defense procurement decisions to the benefit of U.S. exporters.[28]  In 2013, Boeing announced that it had won a $1.6 billion contract to supply South Korea with 36 U.S. Army Apache (AH-64E) helicopters to replace aging fleets with next generation attack helicopters.[29]

U.S. General Imports

Total U.S. general imports from South Korea increased by 2 percent to $71 billion in 2017. The increase in U.S. imports from South Korea was principally driven by the energy sector ($609 million, 27 percent), the minerals and metals sector ($509 million, 10 percent), and the machinery sector ($828 million, 12 percent). Declining U.S. imports of South Korean chemicals and related products (down $966 million or 11 percent) tempered the overall increase in imports.

The energy sector accounted for 4 percent of total U.S. imports from South Korea in 2017, but represented the largest percent increase in U.S. imports.[30] The value of energy-related product imports rose by $609 million (27 percent) to $2.9 billion in 2017. Petroleum products accounted for the majority of this increase, primarily in the form of increased imports of petroleum oils such as kerosene-type jet fuel, imports of which increased from $1.6 billion to $2 billion in 2017.[31] South Korea is the third-largest source of U.S. imports of petroleum oils,[32] after Russia and Canada.[33] Part of this increase in U.S. imports, is due to an increase in jet fuel prices, which rose steadily from $0.93 per gallon in January 2016 to $1.51 per gallon in January 2017 (62.4 percent increase).[34]

The minerals and metals sector accounted for 8 percent of total U.S. imports from South Korea in 2017 and accounted for a large increase in general imports (up by $509 million, or 10 percent).[35] U.S. imports of minerals and metals from South Korea increased to $5.8 billion in 2017. The U.S. is the world’s leading steel importer, and South Korea was its third-largest supplier in 2017, accounting for 10 percent (or 3.4 million metric tons) of U.S. steel imports.[36]  Much of the recent increase in imports from South Korea was due to growing domestic demand for two types of products—steel pipes and tubes, which increased by $871 million (139 percent), and other steel mill products, which increased by $439 million (19 percent). South Korea was the largest supplier of pipe and tube imports and the second-largest supplier of flat products.[37] 

The United States was the largest importer of steel pipe and tube from South Korea in 2017, and according to industry publication, “account[s] for 66% of all South Korean pipe and tube exports."[38] U.S. oil and gas industry demand for South Korean pipe and tube products was concentrated in imports of welded casings used for oil and gas drilling,[39] welded line pipe used for oil and gas pipelines,[40] welded tubing for oil and gas,[41] and seamless casing pipe for drilling for oil and gas.[42] Rising domestic demand for these products was partly driven by increased U.S. petroleum and gas drilling activity, which in turn was spurred by rising prices of oil and natural gas in 2017.[43] South Korean pipe producers have concentrated on line pipe and oil country tubular good pipe products, because other pipe products are already dominated by lower-cost producers such as China.[44]

A large decrease in U.S. imports of chemical products tempered the overall rise in general imports from South Korea. Chemical sector imports from South Korea declined from $8.5 billion in 2016 to $7.5 billion in 2017. A $1.2 billion decline in medicinal chemicals[45] between 2016 and 2017 accounted for a large portion of this decline. In 2017, over 90 percent of all U.S. imports of medicinal chemicals from South Korea were composed of antisera and immunological products, including biotechnology products.[46] U.S. imports of these immunological products from South Korea had increased sharply from 2013 to 2016, rising from less than $2 million in 2013 to $2.4 billion in 2016. The South Korean government’s long-term investment in developing a domestic biopharmaceutical industry has supported the growth of the medical chemicals market, which is expected to reach $24.3 billion by 2020.[47] In 2015, Samsung announced plans to build additional biologics manufacturing plants to support South Korean biologics.[48] South Korea has also attracted significant foreign investment in this domain. Multinational biopharmaceutical companies such as Pfizer, AstraZeneca, Bristol-Myers Squibb, Sanofi, and Novartis have all invested in South Korean pharmaceutical research and development.[49] 

In 2017, however, U.S. imports of total medicinal chemicals from South Korea declined, falling by $1.2 billion (48 percent), driven largely by declining imports of immunological products. This decline in U.S. imports of immunological products from South Korea is in contrast to the overall increase in U.S. imports of immunological products from other suppliers. Total U.S. global imports of immunological products increased from $13.5 billion in 2016 to $18 billion in 2017. Imports of immunological products from Ireland alone grew by $3 billion (or 131 percent) between 2016 and 2017.  The U.S. market accounts for almost half of the worldwide biopharmaceuticals market and trade flows of these high-value products are affected by the international nature of pharmaceutical supply chains.[50] The increase in U.S. imports from Ireland and other European suppliers may be due in part to multinational firms using facilities in these countries to meet U.S. demand.

U.S. Merchandise Trade Balance

The U.S. trade deficit with South Korea declined by $4.7 billion (17 percent) between 2016 and 2017, as total U.S. exports to South Korea increased by $6 billion (14 percent) and total U.S imports from South Korea only rose by $1.3 billion (2 percent). The declining trade deficit resulted from increased U.S. exports across many sectors, including machinery, energy-related products, electronics, and agriculture.[51] At the same time, U.S. imports from South Korea in machinery, steel products, and energy products increased only more moderately, and these increases were tempered by declining U.S. imports of chemicals from South Korea.

 

[1] This discussion is based on the machinery digest (MT) of the U.S. International Trade Commission (USITC) Interactive Tariff and Trade DataWeb (DataWeb). This digest includes semiconductor manufacturing equipment (MT 019).

[2] The semiconductor manufacturing equipment digest (digest MT019) is a subset of machinery exports. The increase in exports in this sector—which includes many types of products—is largely driven by exports of certain semiconductor manufacturing equipment in subheading 8486.20 of the international Harmonized Commodity Description and Coding System (HS). In 2017, South Korea became the leading export market by a significant margin for U.S. semiconductor manufacturing equipment, as U.S. exports of the products in HS 8486.20 rose by 148 percent (from $1.9 billion in 2016 to $4.7 billion in 2017).

[3] Ja-young, “Exports Hit Record High,” October 1, 2017.

[4] USDOC, ITA, “2016 Top Markets Report: Semiconductors; Sector Snapshot,” July 2016; USDOC, ITA, I&A, 2016 Top Markets Report: Semiconductors, July 2016.

[5] Roos, “Will DRAM Prices Continue to Rise?” November 22, 2016.

[6] USDOC, ITA, 2016 Top Markets Report: Semiconductors, July 2016, 40.

[7] According to a U.S. Department of Commerce report, 84 percent of U.S. semiconductor manufacturing equipment sales take place outside the United States. Moreover, “over 90 percent of global semiconductor manufacturing equipment sales outside the United States take place in five markets: China, Taiwan, Japan, Korea (South) and the EU, creating a very concentrated market.” USDOC, ITA, “2016 Top Markets Report: Semiconductor: Sector Snapshot,” July 2016.

[8] USDOC, ITA, “2016 Top Markets Report: Semiconductors; Sector Snapshot,” July 2016.

[9] USDOC, ITA, “2016 Top Markets Report: Semiconductors; Sector Snapshot,” July 2016.

[10]  This discussion is based on the DataWeb digest for Energy and Related Products (EP) and focuses on the subdigests for Crude Petroleum (EP004) and Natural Gas (EP006).

[11] South Korean demand increased in 2016 as a result of lower oil prices in the transportation sector and greater use of liquefied petroleum gas and naphtha in the petrochemical sector. Eurasia Review, “South Korea Energy Profile,” January 22, 2017.   

[12] Eurasia Review, “South Korea Energy Profile,” January 22, 2017.

[13] In addition to crude oil and liquefied natural gas (LNG), exports of LNGs like propane are also in high demand. U.S. exports of liquefied propane to South Korea increased significantly, rising from $391 million to $947 million in 2017 (up 70 percent over 2016).

[14] For 40 years, beginning in 1975, the majority of U.S. domestic oil production was barred from exportation under the Energy Policy and Conservation Act. Agee, “When U.S. Lifted Ban,” March 29, 2018; EIA, “U.S. Crude Oil Exports Increased,” March 15, 2018.

[15] EIA, “Petroleum and Other Liquids: Exports by Destination” (accessed July 3, 2018).

[16] Blewitt, “The U.S. Is Exporting Oil and Gas,” December 12, 2017.

[17] EIA, “U.S. Crude Oil Exports Increased,” March 15, 2018. 

[18] See also Energy section in this report.

[19] Vahn, “APPEC Analysis: South Korea,” September 27, 2017. 

[20] Based on global imports of liquefied natural gas under HTS 2711.11. Global Trade Atlas (accessed July 11, 2018.

[21] Share calculation based on 2017 U.S. liquefied natural gas exports of $596 million to South Korea and total U.S. exports of $3.5 billion under the HTS 2711.11 subheading. Global Trade Atlas (accessed July 11, 2018).

[22] Gloystein, “China Becomes World’s No. 2 LNG Importer,” December 25, 2017.

[23] The favorable price differential in Asia was between the Henry Hub natural gas price (to which U.S. LNG contract prices are indexed) and crude oil (against which LNG prices are benchmarked). EIA, “U.S. Liquefied Natural Gas Exports Quadrupled,” March 27, 2018.  

[24] Loh, Fan, and Abreu, “South Korea’s LNG Demand,” January 18, 2018.

[25] The sole export terminal in the U.S. reached new highs after its capacity was expanded. Blewitt, “The U.S. Is Exporting Oil and Gas,” December 12, 2017.

[26] EIA, “U.S. Liquefied Natural Gas Exports Have Increased,” December 7, 2017.

[27] This discussion is based on the DataWeb transportation equipment digest (TE) and the subdigest for aircraft, spacecraft, and related equipment (TE013).

[28] USDOC, ITA, Export.gov, “Korea—Defense Industry Equipment,” June 19, 2017.

[29] Waldron, “South Korea to Buy 36 AH-64E Apaches,” April 18, 2013; USASAC, “South Korea to Buy Apache Helicopters,” April 17, 2013. See TE 13 breakdown for statistical reporting number 8802.12.0020 in the Harmonized Tariff Schedule of the United States (HTS). This estimate aligns with trade data records for 8802.12.0020 (which would include new Apache helicopters) in U.S. exports of $6.7 million of military helicopters in 2013 and an additional $1.0 billion in exports of military helicopters in 2016.

[30] This discussion is based on the DataWeb energy and related products (EP) digest and the subdigest for petroleum products (EP005).

[31] U.S. imports from Korea in 2016 and 2017 of kerosene-type jet fuel from petroleum oils (under HTS subcategory 2710.19.16).

[32] For further information, review Table KR.2.

[33] This figure is based on HS 2710.19, Petroleum Oils, Oils From Bituminous Minerals (Other Than Crude) and Products Containing By Weight Gt=70% or More of These Oils, Not Biodiesel Or Waste.

[34] EIA, “Petroleum and Other Liquid, Historical Monthly Spot Prices.”  

[35] This discussion is based on data in the DataWeb’s minerals and metal digest and the subdigests for pipe and tube (MM025L) and steel mill products (MM025).

[36] USDOC, ITA, EC, “Steel Imports Report: United States,” June 2018. 

[37] In 2017, Canada accounted for 3.3 million metric tons of U.S. imports of flat steel products, followed by South Korea at 1.1 million metric tons. South Korea accounted for the largest share of steel pipe and tube imports in 2017 (2 million metric ton). USDOC, ITA, EC, “Steel Imports Report: United States,” June 2018. 

[38] Lam, “Korea Steel Pipe Mills,” March 12, 2018.

[39] HTS 7306.29.20.

[40] HTS 7306.19.10.

[41] HTS 7306.29.60.

[42] HTS 7304.29.20.

[43] U.S. rig count is an indicator of increased drilling activity and future output. Most rigs produce both oil and natural gas. The U.S. oil rig count increased by 42 percent between 2016 and 2017. Vedala, “U.S. Oil Rig Count Ends 2017 40 Percent Above” December 29, 2017.

[44] Lam, “Korea Steel Pipe Mills,” March 12, 2018.

[45] Medicinal chemicals are composed of a large variety of products, including antisera and immunological products. Antisera are blood serums containing antibodies that are used immunize against diseases.

[46] These antisera and immunological products were classified in a broader basket HTS subheading 3002.10.02 in 2016 which contained human blood plasma (3002.10.02.10), normal human blood sera, whether or not freeze-dried (3002.10.02.20), human immune blood sera (3002.10.02.30), fetal bovine serum (3002.10.02.40), and other (3002.10.02).  However, in 2017, these products were reclassified such that antisera and other blood fractions were recorded separately from immunological products. As of 2017, antisera and other blood fractions are classified in HTS subheading 3002.12.00 (including human blood plasma (3002.12.002.10), normal human blood sera, whether or not freeze-dried (3002.12.00.20), human immune blood sera (3002.12.00.30), fetal bovine serum (3002.12.00.40), and other (3002.12.0090). Immunological products are separately classified in HTS subheadings 3002.13.00, 3002.14.00, and 3002.15.00; and malaria diagnostic test kits are in HTS subheading 3002.11.00. In 2017, 90 percent of U.S. medicinal chemical imports from South Korea were of immunological products that entered the United States under these three subheadings: 3002.13.00, 3002.14.00, and 3002.15.00.

[47] South Korea began developing its biopharmaceutical industry “in the mid-1980s and has included such steps as creating the first Framework Plan for Biotechnology Promotion (Biotech 2000) in 1994; the Korean Health Industry Development Institute (KHIDI) in 1999 to expand healthcare R&D investment and competitiveness; KoNECT in 2007 to underscore South Korea as a global clinical trial hub; and the Pharma Korea 2020 Roadmap to stimulate innovative drug development and overseas expansion of South Korean pharma companies.” “To reach these goals, the government is trying to boost the pharma market with a fund for R&D, tax deductions for R&D costs, promoting mergers and acquisitions, training workers in the industry, and creating and sustaining a national pharma company to compete on the international stage.” Ribbink, “South Korea,” January 2015.

[48] Rymzo et al., “The Modern Merits of South Korea’s Biopharmaceutical Industry,” July 18, 2016.

[49] Rymzo et al., “The Modern Merits of South Korea’s Biopharmaceutical Industry,” July 18, 2016.

[50] Herh, “‘Trump Care’ Expected to Give Negative Impact,” November 11, 2016.

[51] U.S. exports of agricultural products to South Korea increased in 2017, primarily driven by increased exports of fresh beef. See the Agriculture section in this report.

 

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