American food is popular in South Korea, with French fries and other potato dishes widely available. Image: Michael Kent/Flickr.

Free Trade Agreement Benefits Washington State’s Potato Industry

Korea

March 15 marked the two-year anniversary of the Korea-United States Free Trade Agreement (KORUS FTA) going into force in 2012. A fundamental part of this FTA is the elimination of a number of tariffs and quotas to provide more opportunities to increase trade between the United States and Korea. Washington State’s potato industry is among the beneficiaries of the deal.

In 2011, the year before the USKOR FTA went into effect, the US exported $53 million worth of prepared, frozen French fries to Korea. In 2013, the first full year after the FTA went into effect, the US exported $83 million worth of fries to Korea, an increase of 57%. As a result, Korea is now the fourth largest French fry export market for the US. The majority of US frozen potato products being exported to Korea are from either Washington state, or neighboring Oregon. According to the Washington State Potato Commission, the amount of potatoes grown in Washington for potato chips has expanded over the last five years, because of growing exports to Asia. Potato exports to South Korea increased by 245%, due to the free trade agreement.

The potato industry in Washington is worth $4.6 billion to the state economy and is responsible for 23,500 jobs. Beyond the farmers, there are many other supporting industries that play a major role in this major industry, including the seed companies, shippers, processors, packaging companies, transportation companies, and others.

The KORUS FTA has shown the positive impact that trade agreements have for the United States. The United States and 11 other Asia-Pacific countries are currently seeking to complete the Trans-Pacific Partnership (TPP), a trade agreement that will reduce trade tariffs between Australia, Brunei Darussalam, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States, and Vietnam. TPP is expected to increase trade substantially between member countries.

Jefferson Lee is a Graduate Research Intern at the East-West Center in Washington.