The Office of the United States Trade Representative (USTR) said that 60 economies, including South Korea, have not sufficiently established the laws, systems, and enforcement mechanisms needed to block imports of goods produced with forced labor, and decided to move forward with imposing additional tariffs under Section 301 of the Trade Act. South Korea was classified among countries with inadequate measures and was included as a target for additional tariffs of up to 12.5%.

On the 2nd (local time), the USTR announced the results of an investigation under Section 301 of the Trade Act and concluded that all 60 economies under review have failed to effectively block imports of goods produced with forced labor, burdening U.S. commerce.

Accordingly, the USTR has opened a public comment process on a plan to impose additional tariffs of 10% or 12.5%, depending on the country.

The tariff rates are divided into two groups based on the level of response in each country. Six economies, including Canada, the European Union (EU), Mexico, and Indonesia, were categorized as subject to an additional 10% tariff because, while they have some related systems in place, enforcement is lacking. The remaining 54 economies, including South Korea as well as China, Japan, the United Kingdom, Australia, and Taiwan, were assessed as lacking both legal instruments and enforcement systems, and are expected to be subject to a 12.5% rate.

USTR Representative Jamieson Greer said in a statement, “It is unacceptable that our most important trading partners fail to address the import of goods made with forced labor” and added, “This creates a structure that forces American workers to compete on an uneven playing field.”

This measure comes roughly three months after the USTR launched the related investigation on March 12.

Earlier, to replace reciprocal tariffs that the Supreme Court ruled unlawful in February, the USTR in March initiated Section 301 investigations into ‘overcapacity’ and ‘imports of products made with forced labor’. South Korea is subject to both areas.

With respect to the measures proposed based on the results of this investigation, the USTR plans to finalize implementation after collecting public input, including at a hearing scheduled for the 7th of next month.

Separately from the forced labor issue, the USTR is exerting pressure on multiple trade fronts, including by proposing a 25% retaliatory tariff on the digital trade practices of Brazil.

Greer has also argued, in defending the legitimacy of tariff policies pursued by the Donald Trump administration, that state intervention underlies how resource-poor South Korea became a leading steel producer.

In an article titled ‘Trade Theory Needs to Catch Up With Tariffs, Industrial Policy, and the Costs of Globalization’ contributed to the June issue of the International Monetary Fund (IMF) Finance·Development policy magazine, Greer criticized the post-1990s notion that “Would it not be better for everyone if every country in the world removed trade barriers?” as “the simplistic logic of hyper-globalization.”

Referring to the case of South Korea, he asked, “Why does the United States, with the most fertile farmland, run an agricultural trade deficit, and how did South Korea, short on energy resources and with little coal or iron ore, become a global steel producer?” He argued, “State economic intervention has distorted the global economy in ways that make some countries persistent deficit nations and others persistent surplus nations.”