WTO ruling will boost U.S. beef exports to South Korea

WASHINGTON (Reuters) -- A new World Trade Organization ruling should boost U.S. beef sales to South Korea by keeping that country on the path to market liberalization, a top U.S. official said Wednesday.

"This ruling will greatly enhance market access for U.S. beef later this year as Korea's beef (import) quota is scheduled to expire on December 31, 2000," U.S. Trade Representative Charlene Barshefsky said in a statement.

On Monday, a WTO dispute settlement panel ruled that South Korea's regulations for imported beef discriminated against U.S. and other foreign suppliers, such as Australia.

The panel also concluded "the excessive amount of subsidies" that South Korea provided to its cattle industry violated its commitments under the 1994 Uruguay Round to reduce domestic farm support, USTR said.

South Korea is currently the third largest export market for U.S. beef.

"The elimination of restrictions on both the importation and the distribution of imported beef (as a result of the panel ruling) should afford U.S. exporters a significant opportunity to build on past successes," Barshefsky said.

The United States began dispute settlement proceedings against South Korea in February 1999, after Seoul fell significantly short of meeting its commitment to import at least 187,000 tons of beef in 1998.

According to the U.S. Agriculture Department, South Korea imported only 107,000 tons of beef that year, down from 199,000 tons in 1997.

Australia initiated its own complaint against South Korea in April 1999 and the WTO combined the two cases.

The quota shortfall, which came in the midst of the Asian financial crisis, highlighted South Korean regulations that discouraged consumption of imported beef.

Those included a requirement that imported beef be sold in separate stores, effectively excluding it from about 90 percent of the 50,000 retail beef outlets in South Korea, USTR said.

South Korea also restricted the distribution and sale of imported beef by confining import authority to a small number of governmental and commercial entities, USTR said.

However, as South Korea's economy has improved, its beef imports have risen again.

South Korea imported 202,000 tons of beef in 1999, slightly less than its quota commitment of 206,000 tons, USDA said.

USDA has forecast South Korea would import 240,000 tons in 2000, which would be above its commitment of 225,000 tons.

South Korea has pledged to eliminate quota restrictions on imported beef beginning in 2001.

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