This brings to an end the laborious and intense negotiations that began in June 2006. Both sides began their final make-or-break talks in Seoul on March 26. Highlighting the success of the trade accord, Kim stressed that the pact resulted in over 99 percent of tariff elimination on Korean products and 100 percent for the United States.

The $29 billion accord is expected to boost Korean exports to the United States by $19 billion and U.S. exports to Korea by $10 billion, according to the U.S. International Trade Commission.

Karan Bhatia, deputy U.S. Trade Representative, said he was proud of the deal, which he believes will "mark an important new chapter for the half-decade economic relationship between the two allies."

"It`s an agreement for the 21st century and a strong deal for both Korea and the U.S.," he said. "This agreement is also a powerful testimony for the two democratic countries."

Concessions were made in sensitive areas for both Seoul and Washington. Seoul received wider access to the sensitive U.S. textile market by receiving immediate tariff removal on 61 percent of the total U.S. import amount. Korea currently faces a 13 percent tariff on textiles. Korea was also granted tariff preference levels (TPL) for a limited quantity of specific fabric and apparel goods from non-party sources for five years. TPL goods will be accorded preferential tariff treatment as if they were originating goods.

In return, Korea opened up its sensitive agriculture markets, including pork and oranges, although it succeeded in protecting rice. The trade-off was that Seoul would have to eliminate pork tariffs within 10 years. For oranges, the 50 percent tariff would be removed throughout a seven-year period.

Seoul also managed to assuage Washington on the issue of beef, which U.S. negotiators have said would be crucial for winning support for an FTA from Congress. Korea will be allowed to phase out its 40 percent tariff on American beef imports over 15 years, much longer than what the United States had been pressing for. The decision underscores the importance of Korea`s beef market for the United States. Korea was the world`s third-largest market for U.S. beef before an import ban was imposed in late December 2003 after the discovery of a case of mad cow disease in Washington State.

Seoul rejected three shipments of American beef last year, after resuming beef imports following a three-year ban. The three shipments were turned away because tiny bone fragments were detected. Agriculture authorities here fear that bones could carry the disease, formally known as bovine spongiform encephalopathy.

Automobiles, another sticking point, also saw an amicable conclusion. Korea agreed to immediately eliminate its 8 percent tariff on American passenger cars, and to change its non-tariff barrier of levying tax based on engine size. The United States in return agreed to immediately remove its 2.5 percent tariff on Korean passenger cars with engine sizes of under 3,000cc.

The tariff on automobiles with engines larger than 3,000cc will be removed within three years. Tires and pick-up trucks will have tariffs eliminated in five years and 10 years, respectively.

The removal of tariffs is expected to boost Korean auto exports to the United States by $860 million in the first year, a 10.7 percent increase, the Korea Institute for International Economic Policy said. For the United States, it would mean a big chance to level the playing field for American auto companies, which suffer a small import volume compared with the demand for Korean cars in the United States.

Before the trade pact becomes law, the two countries legislatures have to approve the deal.

The U.S. Congress has 90 days to review the agreement before making their decision. Seoul and Washington concluded the deal yesterday just in time to meet the absolute cut-off-date for meeting the July 1 deadline of the Bush administration`s trade promotion authority. The fast-track authority gives the White House the right to expedite trade deals so Congress can approve or reject the deal, but not alter it.

Both sides had repeatedly said that they would aim for an FTA that is mutually beneficial.

According to a Korea-U.S. trade study by The Heritage Foundation, a U.S.-based economic think tank, a Korea-U.S. FTA is expected to benefit both partners by injecting new competition into their domestic economies, lowering consumer prices, and leveling the playing field for exporters. The authors of the study, published in May 2005, also tout the timeliness of a bilateral pact.

"While free trade is certainly best pursued globally to minimize barriers and distortions in trade, the slow pace of negotiations in the World Trade Organization has led many nations to pursue free trade through bilateral and regional agreements, allowing countries to customize agreements that meet the needs and concerns of individual countries," according to the report.

A USTR report released in February 2006 showed that reducing Korea`s average applied tariff of 11.2 percent, three times greater than the U.S. average of 3.7 percent, on all products will be of significant benefit to U.S. businesses, farmers and workers.

Korea is the world`s 11th-largest economy and the United States is Korea`s third-largest export market after China and the EU.

Korea is America`s seventh-largest export market. In 2003, Korea was the United States` fifth-largest market for agricultural products, and third-largest beef market, according to U.S. Department of Agriculture data.