Washington (CNN) -- U.S. President Barack Obama announced what he called a "landmark" trade agreement with South Korea on Saturday that he said will increase U.S. exports by $11 billion and support 70,000 American jobs.
The agreement would eliminate tariffs on over 95% of industrial and consumer goods within five years.
"It's a win-win for both countries," Obama said.
"It will contribute significantly to my goal of doubling U.S. exports over the next five years," he said. "In fact, it's estimated that today's deal alone will increase American economic output by more than our last nine free trade agreements combined."
Obama made the announcement just after the Senate rejected Obama's proposal to extend the George W. Bush-era tax cuts to everyone but the wealthiest Americans.
Obama said he was disappointed by the tax vote but looked forward to Congress ratifying the trade pact "because if there's one thing Democrats and Republicans should be able to agree on, it should be creating jobs and opportunity for our people."
The trade agreement would strengthen economic ties between Washington and Seoul at a time when the longtime U.S. ally faces an increasingly hostile northern neighbor
The first version of the agreement was negotiated in 2007 by the Bush administration, but foundered in Congress.
The new accord comes just weeks after negotiators failed to reach a deal at the G-20 summit, forcing Obama to walk away from the conference without an agreement.
A long-running dispute over U.S. access to Korea's auto and beef markets was largely responsible for the failure of the earlier agreement. But those issues have since been resolved.
The new agreement calls for South Korea to reduce its tariff on U.S. auto imports from 8% to 4%, and fully eliminate it in five years.
Meanwhile, the 2.5% U.S. tariff on auto imports will remain in place until the fifth year, instead of being immediately eliminated as specified in the 2007 agreement.
"In particular, manufacturers of American cars and trucks will have much more access to the Korean market, will encourage the development of electric cars and green technology in the United States and will continue to ensure a level playing field for American automakers here at home," Obama said.
The deal sparked an almost immediate response from Public Citizen, a liberal group that characterized it as a "Bush NAFTA-style trade deal."
"Choosing to advance Bush's NAFTA-style Korea free trade agreement rather than the new trade policy President Obama promised during his campaign will mean more American job loss," Lori Wallach, the director of Public Citizen's Global Trade Watch said in a statement.
But a number of business leaders praised the deal.
"The resulting agreement provides greater clarity and transparency by affirmatively addressing the issues surrounding non-tariff and tariff barriers," Ford Motor Co. CEO Alan Mulally said as part of a statement released by the White House.
CNNMoney's Charles Riley contributed to this report.