October 20, 2022


Seoul, South Korea - On October 19-20, U.S. and Korean business leaders of the U.S.-Korea Business Council and the Korea-U.S. Business Council (the “Councils”) convened at the Federation of Korean Industries in Seoul, South Korea for the 34th Joint Plenary Meeting. This was the first conference to be held in person since 2019.

The Joint Plenary highlighted the priority areas for U.S.-Korea cooperation announced at the Biden-Yoon summit in May, including critical and emerging technologies, supply chain resilience in critical industries, economic and energy security, global health, and climate change. The Councils also discussed ways to reinforce the bilateral relationship and to improve the business environment in the U.S. and Korea to accelerate post-pandemic recovery. The Councils reaffirmed their commitment to support the two governments’ goals and expressed their readiness to collaborate with the governments to implement the following recommendations.

1. Strengthen the U.S.-Korea economic relationship to accelerate post-COVID-19 recovery.

The COVID-19 pandemic, along with the Russian invasion of Ukraine earlier this year, has highlighted the need for greater collaboration between the government and the private sector in defending the rules-based international order and addressing the significant adverse impact on the global supply chain and economy. Our organizations stand ready to work with both governments for economic recovery and revitalization. The U.S. and Korean private sectors recognize that they will play an increasingly important role to build a stronger and more resilient economy create good jobs, seamlessly deliver quality goods and services, and drive digital and green transformation for sustainable economic growth. Against this backdrop, maintaining an open and stable environment for U.S.-Korea trade and investment will be critical. We therefore urge the governments to:  

  • Remove trade-restrictive measures that are contrary to the letter and spirit of the U.S.-Korea Free Trade Agreement (KORUS), such as the use of import restrictions based on Section 232 of the U.S. Trade Expansion Act, as well as the Korean government’s regulation of pharmaceuticals and medical devices;
  • Continue engaging on issues that could run afoul of KORUS and the World Trade Organization (WTO) Agreement, such as the electric vehicle tax credit passed into law in the Inflation Reduction Act, in search of a non-discriminatory resolution;
  • Address key factors that hinder innovation and investment, such as burdensome administrative procedures, rigid labor rules, and duplicative rules and regulations, e.g., Korea’s Severe Accident Punishment Act (SAPA) that are at odds with global norms;
  • Create a business environment that duly recognizes the risks and rewards of investment in innovative industries such as the biopharmaceutical industry;
  • Foster a regulatory climate that sustains innovation and growth of the digital economy, including by refraining from discriminatory or trade-restrictive measures;
  • Ensure regular public-private dialogue and appropriate time for industry to provide comments for business-related policies during the planning, formulation, and implementation phases of the policies; and
  • Upgrade a U.S.-Korea currency swap facility into a long-term agreement or promote a comparable measure to bring further stability to the Korean exchange market, as follow-up to the May 2022 U.S.-ROK Leaders’ Joint Statement.

2.   Build resilient and trusted supply chains in critical sectors.

Supply chain security and resilience are fundamental to both the economic and national security of the U.S., Korea, and allied countries. While the COVID-19 pandemic posed challenges for government and businesses alike, it also illustrated the benefits of international trade for supply chain resiliency and the need for a renewed collaborative effort among like-minded countries to strengthen and diversify supply chains against future crises, especially in key strategic areas such as semiconductors, electric-vehicle batteries, and pharmaceuticals. The increased geopolitical risks induced by Russia’s unprovoked invasion of Ukraine have added to the strains. In this process, governments must also engage closely with the private sector to ensure that any policy recommendations reject punitive approaches, new trade barriers, and one-size-fits-all solutions. To that end, the Councils encourage the two governments to:

  • Strengthen collaboration bilaterally and multilaterally with like-minded partners, in close coordination with the private sector, to bolster the global supply chain resilience and market diversity of key industries, including but not limited to semiconductor manufacturing, batteries, critical minerals, pharmaceuticals, and defense and commercial aerospace; and
  • Support businesses’ efforts to diversify and make new investments in ways that enhance our collective supply chain resilience and do not create barriers to international trade and investment.

3. Promote regulatory cooperation in the digital economy and strengthen partnership on critical and emerging technologies.

Digitally tradeable goods and services are a key area of U.S. and Korean competitive advantage and export growth, and both countries provide attractive markets for one another’s digital goods and service providers due to their advanced economies, technology capabilities, and sizeable domestic markets. Korea is also a leading exporter of digital goods, particularly its strong content and creative industry. The Councils welcome the U.S. and Korean governments’ discussions to coordinate strong rules for digital trade bilaterally and multilaterally through frameworks such as the Indo-Pacific Economic Framework for Prosperity (IPEF) amid the global proliferation of protectionist digital trade barriers and accumulation of discriminatory digital rules. To define fair principles to promote mutual benefit, we urge the governments and stand ready to work with them to:

  • Update and expand the U.S.-Korea digital agenda through high-standard, binding digital trade commitments, including on the free flow of data across borders; the establishment of a formal mechanism under KORUS such as a technology or digital committee to address ongoing bilateral digital issues; and the promotion and enforcement of good regulatory practices;
  • Ensure that regulatory proposals for the digital economy are not targeted at particular firms, do not hamper innovation, and do not compromise cybersecurity, privacy, or the confidence and convenience consumers expect from devices and services;
  • Deepen the government-industry discussions regarding data governance to better understand the needs of a data-driven economy; and
  • Strengthen cooperation for promoting trustworthy 5G vendors and ICT services such as cloud computing and network infrastructure, and support a competitive, open, and non-discriminatory market.

4. Foster growth and investment in the biopharmaceutical and digital health industries.

The COVID-19 pandemic has underscored the importance of international cooperation as part of the prevention, preparedness, and response to infectious disease threats. U.S. and Korean partnership will be critical to stimulating the growth of biopharmaceutical and healthcare industries to ensure an adequate pipeline of vaccines, therapeutics, and technologies to combat the next pandemic. The Councils recognize the role digital revolution has played in transforming every aspect of healthcare, accelerated by the pandemic. The development and deployment of new technologies, including telehealth, artificial intelligence in diagnostics, and the use of care delivery algorithms have forever changed how we deliver care. The private sector, as the primary developer of digital health tools, would be a critical partner to both governments when crafting digital policies that are both feasible and promote growth. Now is the time to ensure the right policy architecture is created to facilitate both innovation and delivery of digital health technologies, while protecting patient privacy and access to data. To that end, the Councils are committed to work with U.S. and Korean governments to:

  • Re-establish bilateral healthcare dialogue with relevant ministries to discuss healthcare implementation issues and deepen public-private partnerships in biopharmaceutical and medical technology to promote research and increase patients’ access to high quality medicines and medical devices;
  • Support transparent and predictable healthcare and pharmaceutical policies that align with global standards and practices, and ensure that any export restrictions for essential products are deemed necessary and consistent with WTO rules; and
  • Promote global harmonization and an open architecture for digital health data, share best practices related to data and privacy protections, and strengthen policy frameworks for the utilization of personal health records to help improve patient access to digital health technologies.

5. Strengthen energy security, promote decarbonization, and enhance environmental sustainability.

The Councils appreciate the U.S. and Korean governments’ commitment to decarbonization over time by strengthening energy security and bilateral cooperation across all energy sources, from oil and gas, to solar and wind, nuclear, batteries, as well as emerging technologies such as hydrogen.

At a time when many countries around the world are using subsidies, regulatory discrimination, or other forms of government intervention to their favored domestic industries, the U.S. and Korea should take a better course: they should move to decarbonization through open markets and technological innovation, coupled with non-discriminatory treatment of trusted international partners.

Against this backdrop, the Councils are determined to work with the U.S. and Korean governments to facilitate investment in energy sources that are clean, reliable, affordable, and secure. These investments will provide the foundation for a stable global partnership that abides by the following principles:

  • Set informed, realistic, achievable climate goals through an open, consultative process that produces economic growth and prosperity, energy security, and global competitiveness;
  • Whenever possible, utilize markets and public-private partnerships in place of direct subsidies or regulations, and advance policies consistent with free enterprise, free trade and open competition between domestic and foreign investors; and
  • Recognize the unique and important role of natural gas, along with nuclear and renewable energy, as the primary driver of emissions reductions and carbon neutrality over the long-term.

The Councils agree to hold the 35th USKBC-KUSBC Joint Plenary Meeting in the Fall of 2023 in Washington, DC.