South Korea worries about impact of trade war

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Europe

04:42

South Korea’s finance minister has warned that an all-out trade war between the US and China would have grim implications for his country. Many of South Korean exported goods are intermediary parts that end up in Chinese products heading to the United States, making it vulnerable to a China-US trade war.

China isn't the only country feeling the heat from the US. South Korea has also been hit directly by recent US trade measures, which has led to the renegotiating of an existing trade deal.

To mitigate its losses, one way is to expand the Chinese market, said Li Yong, senior fellow at the China Association of International Trade. Li added the other way is to work with China under the Belt and Road Initiative.

That has not stopped Donald Trump from threatening more tariffs, especially on vehicles. Critics of the plan warn potential tariffs of up to 25 percent, plus the inevitable retaliatory measures, could add thousands of dollars to the price of a vehicle.

Speaking of the impact of South Korea-US trade dispute, Li said it is not likely to affect other issues such as the peace process on the Korean Peninsula. However, Li added that their trade tensions will certainly impact the overall nature of their alliance.