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2017-10-10 17:14
Trump rattles double-edged sword 

By Kang Seung-woo

U.S. President Donald Trump could find himself in a quandary over his protectionist stance, reaping unintended consequences.

A series of protectionist measures — better known as “America-first” in his own words — are coming from Washington, raising fears that bombastic campaign pledges regarding Trump’s trade agenda are becoming a reality.

Last week, the U.S. International Trade Commission (ITC) voted 4-0 in favor of a request by Whirlpool  for trade sanctions on washing machines made by Samsung and LG Electronics. Earlier this month, Seoul also had to accept U.S. pressure to begin negotiations to amend their bilateral free trade pact after Trump’s threat to end it.

However, the business mogul-turned-president could find himself in hot water for potentially damaging those who have promised to support his trade policies.

LG and Samsung have both unveiled plans to build washing machine factories in the United States following Trump’s pressure on global and local firms to establish plants there as part of efforts to create jobs for Americans.

In March, LG announced it would spend $250 million (284 billion won) to build a plant in Clarksville, Tennessee, by early 2019, expecting to create 600 new jobs. Three months later in June, Samsung followed with a plan for a $380 million production facility employing 950 workers in Newberry, S. C.

“We urge the commission to consider carefully how potential remedies might hinder the establishment and operations of this facility and affect American consumers,” Samsung said in a statement. The firm added it remains committed to building the plant in South Carolina. The ITC’s recommendations for sanctions are likely to be specific tariffs or quotas.

Some officials in Tennessee and South Carolina fear Whirlpool’s case might derail the plans, according to the Los Angeles Times.

In addition, the possible remedies are anticipated to negatively affect American consumers by limiting their choices, raising prices and offering less innovative washing machines.

“It is U.S. retailers and consumers who chose to purchase LG washers,” LG said.

The New York Times said this type of trade case will end up raising costs for American consumers and punishing foreign companies that have devised products that are more attractive to American consumers.

The Hill, a U.S. political website, published an article “We don’t need the federal government to pick our washing machines.”

The Korean home appliance sector has complained the ITC ruling is no more than a rescue plan for Whirlpool, which has struggled to impress end users with innovative features.

“Samsung and LG have strived to push the envelope, while Whirlpool has not been successful in dealing with brand management and its timing of investments as well as technical innovations,” an official at a Korean electronics business said.

“The ITC decision attributes Whirlpool’s mismanagement to the Korean firms, which will hamper fair competition in the market.”

The ITC investigation will move to a remedy phase and a public hearing is scheduled for Oct. 19 before it recommends remedies that will be forwarded to Trump by Dec. 4.

The government here is to hold meetings today with the companies.

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