ID :
212522
Thu, 10/13/2011 - 06:50
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https://oananews.org//node/212522
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S. Korea pressed to follow suit after U.S. FTA approval: experts
SEOUL (Yonhap) - Now that the U.S. Congress has ratified a free trade agreement with South Korea, Seoul is under mounting pressure to do the same with the long-pending deal expected to boost bilateral trade between the allies, observers said Thursday.
The trade deal between South Korea and the U.S., known as the KORUS FTA, was signed in 2007 and supplemented in December of last year with minor modifications that mostly dealt with the auto industry.
The agreement had been awaiting approval from the legislatures of both countries. Opposition lawmakers here object the deal, calling for more support measures for agricultural and other sectors.
On Wednesday, the U.S. Congress passed the deal and the ball is now in South Korea's court to enforce what many see as a landmark trade pact with the world's largest economy.
Experts worry that a further delay here could hurt Korean companies' competitiveness in the U.S. against rivals such as those in China and Japan, at a time when the global economic situation is getting tough and competition is ever intensifying.
"A delay in enforcing the trade pact would limit our leeway in the U.S. market and cause more costs by dashing our chance to secure a competitive advantage in the competition-driven market," said Kim Hyung-joo, a researcher at the LG Economic Research Institute.
Technical issues could become a major hurdle in the process as South Korea needs to complete the revision of laws needed to enforce the free trade deal with the U.S. Currently, 14 revisions are pending in the National Assembly.
Even if the trade bill passes in parliament, the government still needs to complete such measures before it can go into effect. That could make it tough for the government to meet the informal deadline of Jan. 1 by which both countries seek to enforce the FTA.
"If we fail to pass the free trade bill by the end of this month, it is anyone's guess when those 14 revision bills will be approved," said Choi Seok-young, the country's top FTA negotiator. "This is a very worrisome situation."
Experts expect the swift action by the U.S. Congress in passing the deal could jolt South Korean lawmakers to put aside their differences and act quickly, observers said.
The outlook remains bleak, however, as lawmakers remain far apart on many issues. The opposition parties, in particular, have been pressing the government to renegotiate the deal as they claim the pact does not reflect a balance of interests, and to come up with more support measures for the agricultural sector and others.
"If we pass the bill without dealing with the issue of a balance of interests, it could help broaden the economic territory of the U.S. but cause the horrible consequence of us giving up our whole domestic market turf," said Rep. Kim Jin-pyo, floor leader of the main opposition Democratic Party, on Thursday.
In a press release after the U.S. Congress ratified the deal, the finance ministry here said it will keep listening to opinions from lawmakers and experts and work hard to draw up measures to minimize the impact the deal could have on domestic sectors.
The U.S. is now South Korea's fifth-largest trade partner, with their bilateral trade volume reaching US$90.2 billion last year. Under the FTA, tariffs on more than 80 percent of items produced by the two countries will be lifted.
According to a report jointly compiled by 10 local state-run think tanks, if the deal takes effect, South Korea will see its gross domestic product expand by an additional 5.66 percent in the long term.
The think tanks also predicted that South Korea will see its trade surplus with the U.S. increase by $140 million annually over the next 15 years after the FTA goes into effect.
The trade deal between South Korea and the U.S., known as the KORUS FTA, was signed in 2007 and supplemented in December of last year with minor modifications that mostly dealt with the auto industry.
The agreement had been awaiting approval from the legislatures of both countries. Opposition lawmakers here object the deal, calling for more support measures for agricultural and other sectors.
On Wednesday, the U.S. Congress passed the deal and the ball is now in South Korea's court to enforce what many see as a landmark trade pact with the world's largest economy.
Experts worry that a further delay here could hurt Korean companies' competitiveness in the U.S. against rivals such as those in China and Japan, at a time when the global economic situation is getting tough and competition is ever intensifying.
"A delay in enforcing the trade pact would limit our leeway in the U.S. market and cause more costs by dashing our chance to secure a competitive advantage in the competition-driven market," said Kim Hyung-joo, a researcher at the LG Economic Research Institute.
Technical issues could become a major hurdle in the process as South Korea needs to complete the revision of laws needed to enforce the free trade deal with the U.S. Currently, 14 revisions are pending in the National Assembly.
Even if the trade bill passes in parliament, the government still needs to complete such measures before it can go into effect. That could make it tough for the government to meet the informal deadline of Jan. 1 by which both countries seek to enforce the FTA.
"If we fail to pass the free trade bill by the end of this month, it is anyone's guess when those 14 revision bills will be approved," said Choi Seok-young, the country's top FTA negotiator. "This is a very worrisome situation."
Experts expect the swift action by the U.S. Congress in passing the deal could jolt South Korean lawmakers to put aside their differences and act quickly, observers said.
The outlook remains bleak, however, as lawmakers remain far apart on many issues. The opposition parties, in particular, have been pressing the government to renegotiate the deal as they claim the pact does not reflect a balance of interests, and to come up with more support measures for the agricultural sector and others.
"If we pass the bill without dealing with the issue of a balance of interests, it could help broaden the economic territory of the U.S. but cause the horrible consequence of us giving up our whole domestic market turf," said Rep. Kim Jin-pyo, floor leader of the main opposition Democratic Party, on Thursday.
In a press release after the U.S. Congress ratified the deal, the finance ministry here said it will keep listening to opinions from lawmakers and experts and work hard to draw up measures to minimize the impact the deal could have on domestic sectors.
The U.S. is now South Korea's fifth-largest trade partner, with their bilateral trade volume reaching US$90.2 billion last year. Under the FTA, tariffs on more than 80 percent of items produced by the two countries will be lifted.
According to a report jointly compiled by 10 local state-run think tanks, if the deal takes effect, South Korea will see its gross domestic product expand by an additional 5.66 percent in the long term.
The think tanks also predicted that South Korea will see its trade surplus with the U.S. increase by $140 million annually over the next 15 years after the FTA goes into effect.
