Korea-U.S. FTA

So. Korea's Shifting Stance Towards the Regime in the North

Evan Ramstad reports from Seoul that the likely winner in this month's So. Korean Presidential elections, Seoul's former Mayor Lee Myung-bak, is likely to take a harder line with North Korea than his predecessors: Why South Korean Vote May Fray Ties With North. Front-Runner Promises Tougher Stance on Aid; Public's Priorities Shift (Wall Street Journal, Dec 17).

Labor Rights in the Export Processing Zones

The export processing zone in North Korea at Kaesong is an important part of South Korea's efforts to improve relations with the North.  South Korean companies make products there for domestic use and export using North Korean workers.  New zones may be added in the future.

The South Koreans wanted the FTA to cover goods from these zones.  The final agreement didn't allow this, but created a framework - including a joint U.S.-Korean committee - for deciding whether or not to do so in the future.  These provisions are in Annex 22-B.

Human Rights Watch objects to these provisions.  In fact, it thinks the whole agreement should be abandoned because of this one section.  It feels the agreement misses an opportunity to push North Korea even harder towards improvements in the treatment of workers.

These are the key provisions of the annex:

Reconnecting the Koreas

North and South Korea have agreed to a number of new joint development initiatives: Korean leaders tout new initiatives (Choe Sang-hun, International Herald Tribune, Nov 17).

KFTA Assessment from Jeffrey Schott

The Peterson Institute has released an assessment of the FTA by Jeffrey Schott: The Korea-US Free Trade Agreement: A Summary Assessment (Policy Brief 07-7, August 2007).

Schott is a supporter.  This survey is tightly focused on a few issues.  Separate sections deal with autos, agriculture, services, the Kaesong industrial complex, implications for trade relations in the Asia-Pacific, and the prospects for ratification in the U.S.  Schott doesn't draw on, or add to, the general equilbrium modeling.  The abstract:

Export-processing zones in N. Korea: Annex 22-C

The export-processing zone at Kaeseong or Gaeseong in North Korea has been an important part of So. Korea's outreach to the north.   On the other hand, the U.S. is extremely sensitive to the political implications of these goods, and is concerned that the workers producing them are being exploited.

The export-processing zone at Kaeseong or Gaeseong in North Korea has been an important part of So. Korea's outreach to the north.   On the other hand, the U.S. is extremely sensitive to the political implications of these goods, and is concerned that the workers producing them are being exploited.

USC Korean Studies Institute FTA Symposium

In October, the Korean Studies Institute of USC, in cooperation with other organizations, sponsored a symposium with panels on the FTA, and on the North Korea "question."  Here is the description of the discussions from the Institute's newsletter (The US‐Korea FTA and the North Korea Question Revisited, Winter, 2007):

North Korean Trade

This week's "Trade Fact of the Week" from the Progressive Policy Institute is about the North Korean economy: South Korea-North Korea Trade Topped $1 Billion Last Year .