Korean Lawmakers Want US FTA Renegotiated

While the South Korean government and the ruling Grand National Party (GNP) are looking for parliamentary approval of the signed South Korea–United States free trade agreement (KORUS FTA) next month, the opposition Democratic Party (DP) is still looking for major changes.

The parliamentary opposition leader, Sohn Hak-kyu, has confirmed that the DP requires a re-balancing of the KORUS FTA, as they believe that, following its renegotiation last December, the trade agreement is now too favourable to the US, and they continue to insist that the agreement should be further renegotiated.

The DP has, in fact, put a set of proposals before the GNP and the government, the so-called “10+2” proposals, that include ten subjects to be re-negotiated and two matters for the government to resolve domestically, before they could contemplate support for the KORUS FTA’s passage through parliament.

One of the major points for re-negotiation would be that tariffs on beef imports from the US (the reduction of which was a particular sticking point for members of the US Congress) should be retained for a considerable period, together with stronger safeguards for the South Korean motor vehicle and finance industries. It is also felt that official assistance for manufacturing and agricultural producers in South Korea will need to be augmented.

While the government could use its parliamentary majority to obtain the agreement’s passage, it does not want to do so and leave itself open to accusations of railroading it through parliament. The GNP has accused the DP of objecting to the KORUS FTA on political and ideological grounds, but that has not helped in obtaining any possible compromise with the opposition.

According to the US government, goods and services trade with Korea totalled USD87bn in 2009, and Korea is the US's seventh-largest goods-trading partner.

The KORUS FTA was signed on June 30, 2007. The United States has also not yet approved the agreement.

July 21, 2011

Source: Tax News