SOUTH KOREA-FREE TRADE AGREEMENT.
Seoul, South Korea — South Korea is launching high-profile efforts to jump on the free trade bandwagon, to bolster its export-dominated economy and cope with a growing trend toward protectionism.
With President Lee Myung-bak traveling to Australia and New Zealand for talks heavily focused on free trade deals, South Korea’s ruling and opposition lawmakers agreed on Wednesday to vote on the long-delayed ratification of a free trade pact with the United States next month.
In Seoul, the new South Korean envoy to the United States called on the U.S. Congress to ratify the agreement, which President Barack Obama opposed during his presidential campaign.
In Brussels, South Korean government officials are preparing to put final touches on free trade negotiations with the European Union, the country’s second-largest trading partner.
South Korea, which had long remained out of the race for free trade deals, has vowed to seek more accords aimed at tearing down trade barriers, with hope of transforming the country into "an FTA hub," linking Europe, Asia and the American continent.
Once the country’s ruling and opposition parties agreed to vote on the ratification of the South Korea-U.S. accord, the bill is likely to be passed, as the pro-FTA ruling party dominates the single-chamber legislature. The ruling Grand National Party has an outright majority of 172 seats in the 299-member legislature against the main opposition Democratic Party’s 83.
Ruling and opposition lawmakers also agreed to discuss before the planned vote how to protect local farmers and filmmakers worried that opening the market will jeopardize their business.
Seoul and Washington signed the free trade accord in June 2007 after 10 months of tough negotiations. But it is still awaiting ratification by both countries’ legislatures. The deal is opposed by many U.S. Congressional Democrats, largely supported by trade unions that fear possible job cuts from the ratification of the agreement.
While campaigning, Obama opposed ratification of what he called a "badly flawed" free trade agreement with Seoul, saying that South Korea exports more than 700,000 autos to the United States annually while importing just 6,000.
During a Senate confirmation hearing in January, U.S. Secretary of State Hillary Clinton vowed to seek renegotiation of the free trade deal with South Korea, citing an imbalance in auto trade and restrictions on beef shipments. But Clinton did not raise the sensitive issue during her visit to Seoul last month. South Korea has ruled out any renegotiation of the pact.
In a possible sign of change in its opposition, the Obama administration said in a trade representative policy report this week that it would "promptly, but responsibly, address the issues surrounding the Colombia, Korea and Panama free trade agreements."
U.S. Treasury Secretary Timothy Geithner also said the government would "work carefully" with Congress toward the ratification of the pending free trade accords.
Han Duck-soo, newly appointed South Korean ambassador to Washington, welcomed the remarks as showing a U.S. commitment to advance the ratification of the hard-won bilateral trade pact, and called for more efforts to speed it up.
Han, former finance minister and prime minister and the country’s free trade flag-bearer, was recently named top envoy to Washington, with the most urgent task of pressing the United States to ratify the agreement.
President Lee, who made the concession of reopening South Korea’s markets to U.S. beef in order to conclude a free tree trade deal with the United States, is using his visits to Australia and New Zealand this week to declare the opening of free trade negotiations with those countries as well.
In Sydney, Lee called for joint efforts with Australia to fight a growing trend toward protectionism. At a forum there on Wednesday, Lee warned that protectionism would only lead to a market contraction and thus delay the recovery of the global economy, according to the presidential office.
During summit talks, Lee and Australian Prime Minister Kevin Rudd in Canberra announced the start of talks for a free trade agreement. Earlier this week, Lee and his counterpart in New Zealand also announced the launch of free trade negotiations.
South Korea, which signed free trade accords with Chile, Singapore and the European Free Trade Association consisting of Switzerland, Norway, Iceland and Liechtenstein, is in negotiations with the EU, Japan, Canada, Mexico and India.
Seoul has also agreed to push for similar deals with China and the 10-member Association of Southeast Asian Nations, while seeking to clinch a deal with the Cooperation Council for the Arab States of the Gulf.
Lee said free trade deals are critical for South Korea’s export-driven economy, noting the total volume of its external trade amounts to 75 percent of the country’s gross domestic product.
The brisk moves toward free trade deals come as the country’s exports tumbled amid shrinking global trade in the wake of the worldwide economic crisis and mounting protectionism. South Korean exports in the first two months plunged 31.4 percent from a year earlier, underscoring the country’s vulnerability to the global economic slowdown and protectionism.
