South Korea remains cautious over whether to stick to its special and differential treatment under the World Trade Organization as the United States pushes to reform the global trade body.
South Korea has been keeping developing country status since 1995 mainly to protect its sensitive agriculture industry, especially rice.
Hong Nam-ki, the minister of economy and finance, said South Korea needs to "fundamentally" review whether it can maintain the status in the future, saying other developing countries are taking issue with South Korea's status.
"A very cautious approach is needed" Hong said in a meeting with officials at a government in central Seoul. He said South Korea will take into account national interest, its economic status and economic impact when it decides whether to keep the status.
The comments came as U.S. President Donald Trump is seeking to overhaul the rules of the Geneva-based trade body to make sure that self-declared developing countries do not take advantage of the benefits that come with the status.
The U.S. has proposed that the WTO strip countries of developing country status if they meet certain criteria -- being members of Group of 20 advanced economies; being members of the Organization for Economic Cooperation and Development (OECD); being high-income countries as classified by the World Bank and taking up at least 0.5 percent of total global trade.
South Korea meets all four of the criteria, which could undermine its efforts to maintain its status
In July, Trump named South Korea, Mexico and Turkey as countries claiming developing-country status even though they are members of both the G-20 and the OECD, a group of 36 mostly rich nations.
Trump also said if no substantial progress is made in overhauling the WTO rules by mid-October, the U.S. will no longer treat as a developing country any WTO member Washington says is not one.
The issue of the developing country privileges is also about future multilateral negotiations, meaning that South Korea's agricultural subsidies and its agricultural tariffs won't be affected even if Seoul decides to forgo the status.
Currently, South Korea imposes a 513-percent tariff on imported rice for quantities outside the quota of 409,000 tons of annual rice imports from the U.S. and four other countries under the system of tariff-rate quotas meant to provide minimum market access.
Hong said South Korea is in the final stages of negotiations with the U.S., China, Australia, Thailand and Vietnam over rice tariff, though he did not provide any further details.
Government data showed 54 percent of the 1 million South Korean farming households grow rice, a staple food for Koreans.
South Korea paid 8.2 trillion won (US$6.87 billion) in agricultural subsidies to farmers out of the 11.49 trillion won available in 2015, the latest year for which statistics are available.
South Korea's total agricultural subsidies largely depend on the value of agricultural output in a given year and the ceiling hovers around 11.49 trillion won. (Yonhap)