Korea-U.S. FTA

Resolution of the Beef Controversy?

Negotiations

On Friday the 13th the Korean Trade Minister, Kim Jong-Hoon, arrived in Washington for negotiations with Susan Schwab, the US Trade Representative.  The initial negotiations took place on Friday and Saturday.  Twice Kim threatened to walkout and return to Korea.  However, the negotiations stretched out for almost a week, finally ending on the 19th. Here's a combination of a profile of Kim with a discussion of the negotiations: Man of Adroit Brinkmanship (Jane Han, The Korea Times, June 22)

Obama Says "No" To KORUS FTA, Again

Obama spoke out against the Korea-U.S. trade agreement again on Monday (June 16) in a speech in Flint Michigan.  Unemployment is high in Michigan (8.5% in May, and Flint is an auto town): Obama Renews Attack on Korea-U.S. FTA (Chosun Ilbo, June 19).

Obama's speech dealt with American competitiveness.  He focused on increased funding for education and educational reform, energy security, and increased investment in research and infrastructure.  But these measures also have to be supplemented with "smart" trade policies.  Trade was not the focus of the speech - it only got a couple of paragraphs towards the end.

Here's the full text of the speech: Remarks of Senator Barack Obama: Renewing American Competitiveness. On the agreement with Korea:

But even as we welcome competition, we need to remember that our economic policies must be supported by strong and smart trade policies. I have said before, and will say again – I believe in free trade. It can save money for our consumers, generate business for U.S. exporters, and expand global wealth. But unlike George Bush and John McCain, I do not think that any trade agreement is a good trade agreement. I don't think an agreement that allows South Korea to import hundreds of thousands of cars into the U.S., but continues to restrict U.S. car exports into South Korea to a few thousand, is a smart deal. I don't think that trade agreements without labor or environmental agreements are in our long term interests.

He had a few more remarks about trade in general:

If we continue to let our trade policy be dictated by special interests, then American workers will continue to be undermined, and public support for robust trade will continue to erode. That might make sense to the Washington lobbyists who run Senator McCain's campaign, but it won't help our nation compete. Allowing subsidized and unfairly traded products to flood our markets is not free trade and it's not fair to the people of Michigan. We cannot stand by while countries manipulate currencies to promote exports, creating huge imbalances in the global economy. We cannot let foreign regulatory policies exclude American products. We cannot let enforcement of existing trade agreements take a backseat to the negotiation of new ones. Put simply, we need tougher negotiators on our side of the table – to strike bargains that are good not just for Wall Street, but also for Main Street. And when I am President, that's what we will do.

The Perils of President Lee

President Lee has faced more perils than Pauline in recent weeks.  The photo was taken in happier days, well before the beef agreement.  This week he had to work through a cabinet restructuring, negotiations with Washington, the biggest in the string of beef demonstrations, and a truckers' strike.

Korean Economists On Trade and Other Issues

The Korean International Economic Association evidently held a conference or seminar on Friday.   Yoon Ja-young reported on the comments of three economics professors: 'US Is Not a Model for Korea', The Korea Times, June 13).  

"I'm not saying that the election is not important, but the true democracy is on the streets"

Evan Ramstad reports on the situation in Korea: massive nightly street demonstrations; an apologetic President with abysmal approval ratings, a paralyzed agenda, and a cabinet that has tendered their resignations; a National Assembly that can't meet because of an opposition boycott: Korean Protests of U.S. Beef Take on Broader Dimension (Wall Street Journal, May 10). 

I hope this sentiment isn't widely held:

South Korean Cabinet Offers to Resign

South Korea's Cabinet offered to resign because of its responsibility for the beef crisis: SKorean cabinet offers to quit as beef protests intensify (AFP, June 10).  No early word on whether the resignations will be accepted, but reporting by Yonhap News "Lee is expected to replace four or five ministers including those responsible for agriculture, health and education."

Meanwhile, the Koreans get ready for big demonstrations tonight.  These should be underway now - it's about midnight in Seoul as I write.

The Week's Beef News From Korea

On Monday, the Lee Administration decided to delay the planned reopening of beef imports from the U.S. that had been scheduled for Tuesday: New Delay on Beef Imports (and Renegotiation?) (Korea-U.S. FTA, June 2).  The Dong-A Ilbo describes some of the background discussions within the Lee Administration: The Story Behind the New U.S. Beef Measure (June 4).

New Poll Results Show Support for FTA in Korea

A poll conducted for the Hankook Ilbe shows that two-thirds of Koreans support ratification of the proposed trade agreement with the U.S.: Two-Thirds of Koreans Back FTA With US (Kim Sue-young, The Korea Times, June 8, 2008):

According to the poll conducted by the Hankook Ilbo, a sister newspaper of The Korea Times, on the occasion of the 54th anniversary of its founding, 31.6 percent of 1,000 respondents said the Assembly should ratify a motion on the FTA as soon as possible.

About 35.1 percent supported a parliamentary approval for the FTA on the condition that the U.S. Congress passes a motion, said the survey.

Nineteen percent called for rejection, while 14.3 percent remained undecided.

The poll found a lot less support for the current version of the beef agreement:

The survey found that 55.5 percent of the people want a complete renegotiation while 14.3 percent said the nation should adjust the deal if mad cow disease is reported in the U.S.

Those calling for a wait-and-see attitude accounted for 14.2 percent but they claimed revising the accord is necessary if the nation is found to be at disadvantageous compared to Japan and Taiwan which will hold talks to import American beef soon.

This doesn't add up to 100%.  The article is a little confusing about some poll results, perhaps because of translation issues.

What's Behind the Beef Demonstrations?

Evan Ramstad explores the emotions driving the beef demonstrations in Korea: Korea's Beef With the U.S. (Wall Street Journal, June 6).  In part, he says, the controversy has been driven by a sense among Koreans that they've somehow been had in the trade negotiations - a sense exploited by opposition political parties:

While Washington is Seoul's closest military ally and a lead trading partner, South Koreans chafe at the appearance of being under America's thumb. And to many of them, the new president, Lee Myung-bak, appears to have exhibited weakness by making a less-restrictive beef-import deal than neighbors Taiwan and Japan did with the U.S....

Just after the U.S. and South Korea made the deal on April 18, politicians from the United Democratic Party, who led South Korea for a decade but recently lost control to Mr. Lee and the GNP, criticized Mr. Lee for being outmaneuvered by U.S. trade negotiators. "The political left had been waiting for an opportunity to damage the new government after losing the elections, and they took advantage of it," says Jhe Seong-ho, a law professor at Chung-Ang University in Seoul.

New Insights on Korean Beef Controversy and FTA

The latest issue of the Korea Economic Institute's Korea Insight has two short issues on the beef and FTA debates in Korea: (a) Troy Stangarone describes A Firestorm in Korea Over U.S. Beef, while James Lister and Stangarone provide an FTA Update. Short, readable, summaries of recent events. Some interesting points: