Jamieson Greer, U.S. USTR Representative [UPI=Yonhap News Agency File Photo]

Jamieson Greer, the U.S. Trade Representative (USTR), reiterated the importance of tariff policy for restoring trade balance on the 2nd (local time), ahead of the announcement of the results of the Section 301 investigation.

He also cited South Korea's case of becoming a steel powerhouse despite its relatively scarce resources, arguing that government intervention can lead to structural trade imbalances.

In an article published this month in the International Monetary Fund's (IMF) Finance & Development Magazine (F&D Magazine), Greer stated, "The United States is taking bold action to establish the foundation of an international economic system based on balance, reciprocity, fairness, and resilience."

"We are already witnessing the positive effects of President Trump's tariff policy," he said.

Specifically, he cited as evidence the 32% decrease in the U.S. trade deficit with China year-on-year last year, and the fact that the trade deficit in goods has been decreasing month-on-month compared to the same period in the previous year since President Donald Trump implemented a sweeping reciprocal tariff policy in April last year (which was abolished by a Supreme Court ruling in February this year).

Greer emphasized, "Modern economics must consider the reality that economies of scale combined with government intervention create structural trade imbalances that are detached from comparative advantage."

He then asked, "How can the United States, with the most fertile farmland in the world, record a trade deficit in agriculture? How could South Korea, with limited energy resources and no coal or iron ore, become a steel powerhouse?"

"Each country's economic intervention has distorted the global economy by placing some countries in a state of chronic (trade) deficit and others in surplus," he pointed out. "This is not desirable for either side."

This is interpreted as revealing Greer's view that government industrial policies alter a country's production and export structure, creating trade structures that are difficult to explain solely by traditional comparative advantage theory and market principles.

Greer argued that for about 30 years before President Trump took office, tariffs and import restrictions had been virtually excluded from policy-making processes, leading to a sharp decline in U.S. manufacturing jobs, factory closures, and a surge in trade deficits.

Regarding the U.S. trade deficit, he reiterated the need for tariff policy, stating, "Surplus countries have no reason to act without real pressure, but that does not mean deficit countries should remain powerless."

Following the Federal Supreme Court's ruling invalidating reciprocal tariffs in February, the Trump administration has been imposing a so-called "global tariff" of 10% on trade partners worldwide, based on Section 122 of the Trade Act.

Global tariffs under Section 122 of the Trade Act can be imposed for a maximum of 150 days, and new tariffs are expected to be introduced based on the results of the Section 301 investigation before the end of July when this period expires.

Section 301 of the Trade Act empowers the executive branch to respond to unfair policies and practices of foreign governments with measures such as imposing tariffs.

In an interview with CNBC on the same day, Greer stated that the results of the Section 301 investigation against dozens of countries, including South Korea, would be announced within weeks.