With the US and South Korea having made significant progress in reaching a bilateral Free Trade Agreement (FTA), Taiwan's Ministry of Economic Affairs (MOEA) is concerned about the potential negative impact of the FTA on Taiwan's exports to the US, according to the MOEA's Office of Trade Negotiations (OTN).

The US was Taiwan's second largest export market and South Korea's third largest in 2009, OTN indicated. Taiwan and South Korea accounted for 1.82% and 2.51% respectively of the United States' total import value in 2009, ranking as the ninth and seventh largest respectively, OTN noted. As the two countries are similar in terms of industrial structure and development, South Korea has been Taiwan's biggest competitor in the US market, OTN said.

For products subject to US tariffs, such as 3.9-5% for LCD TVs, the FTA will make South Korea-made products more price-competitive than Taiwan-made products in the US market, OTN said.