South Korean firms fear trouble amid rising US tariffs

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Asian firms are bearing the brunt of heavy taxes the US slapped on imported washing machines and solar panels.

The washing machines are at the center of a global trade dispute. The US trade commission has slapped a 20 percent tax on the first 1.2 million imported devices and a 50 percent tax on anything exceeding that amount.

The authorities said it aims at protecting US manufacturers and jobs. But some experts said the measures are just as much a political move as it is an economic one.

Deputy Manager of Korea International Trade Association Je Hyun-Jung said the US President Donald Trump’s protectionist policies are expected to continue and strengthen because of the elections later this year.

“He will likely take his message of lowering the US trade deficit and protecting US industries to voters in the upcoming midterm polls," he explained.

New wall-mounted Korean washing machines /VCG Photo

South Korean manufacturers shipped nearly a billion dollars’ worth of large residential washing machines to the US in 2016. They make up almost 30 percent of the entire US market share.

The companies like Samsung and LG Electronics are building their own factories and facilities within the US.

Je Hyun-Jung said if the US sanctions China, South Korean products will inevitably fall under the same categories because China and South Korea have nearly similar export structures.

It means the sanctions on China are directly harming South Korea, he said.

It is being viewed as a part of Trump's 'America First' drive aimed at protecting the country’s domestic industries. As a result, South Korean firms could be left hanging out to dry.

In a protest, South Korea filed a complaint against the US at the World Trade Organization.