In the latter part of October, US Commerce Secretary Penny Pritzker traveled to Japan and South Korea, leading a trade mission of 20 American firms that were looking to enter Asian markets. Since taking office in June of 2013, Secretary Pritzker has traveled to Asia four times in just 16 months, highlighting the economic importance the region represents to the US. In June of 2014, she traveled to three ASEAN nations, including Myanmar, where energy and entrepreneurship were among her top priorities. The most recent trip, visiting two of the United States’ key economic partners in East Asia, was focused on the energy and healthcare fields, echoing some of the themes of the Secretary’s previous visits to the region.
The US companies that sent representatives on the trip ranged in size from small firms looking to enter the Korean and Japanese markets for the first time, to much larger firms looking to expand their presence. The companies also represented a broad swath of the US, hailing from twelve states, including Illinois, Pennsylvania, New York, California, Minnesota, Michigan, Indiana, Texas, North Carolina, New Jersey, Washington, and Ohio. The level of interest given to this trade mission is reflected in the fact that Secretary Pritzker and her delegation met with South Korean President Park Geun-hye while in Seoul and with Prime Minister Abe while in Tokyo, as well as other key government officials.
Secretary Pritzker’s destinations on this trip are particularly important to US trade interests in Asia. The Korea-US Free Trade Agreement (KORUS FTA) is currently in its third year, and is the second largest FTA that the US is a part of after NAFTA. While the specific outcomes from that agreement have not yet become fully apparent due to the short time since it was implemented, there is the expectation that both countries will experience long-term gains as long as South Korea is able to fully implement its side of the agreement. The Korean government has also signaled an interest in joining the Trans-Pacific Partnership (TPP) at some point in the near future, to which the US has responded encouragingly.
Japan is already a part of the on-going TPP negotiations, which may get a boost from the outcome of the recent US midterm elections. President Obama has emphasized TPP as the key economic component of his “rebalance” to Asia policy, while Republican majorities in the House and the Senate generally favor free trade deals. While in Tokyo, Secretary Pritzker discussed the importance of the US and Japan reaching common ground in the lingering areas under discussion in the TPP negotiations. Prime Minister Abe also recently stated his belief that the TPP is an important agreement and that all parties are close to finalizing it.