Presidents Obama & Lee confirm US/Korea FTA on track to resolve issues by November

As part of the twin summits which world leaders are attending in Canada this weekend, President Obama and South Korean President Lee Myung-Bak confirmed Saturday that they aim to work out differences over Korea's non-tariff barriers blocking imports of U.S. agricultural products and autos by the time President Obama visits the Republic of Korea in November.

Commenting on his meeting with President Lee on Saturday, Obama explained that the two men had “a lengthy negotiation to arrive at a free trade agreement. The last time I was in Korea, I said that I would be committed to moving this forward. And today I indicated to President Lee that it is time that our United States Trade Representative work very closely with his counterpart from the ROK to make sure that we set a path, a road, so that I can present this FTA to Congress.”

Obama said “We are going to do it in a methodical fashion. I want to make sure that everything is lined up properly by the time that I visit Korea in November.” But don't count on an immediate surge in U.S. beef, pork and other exports to South Korea next winter. Obama added that following his November visit, “in the few months that follow that, I intend to present it to Congress,” an indication that congressional ratification of a new FTA still could be nearly a year away.

Lee commented that “we agreed on the adoption of the Korea-U.S. free trade agreement . . . He and I agreed that we will continue to work closely together so that we can talk about the specific ways to move this forward. And we very much welcome and thank President Obama for proposing a date for us to look forward to, and we will work towards that date and that objective in the weeks and months ahead.”

The White House's Deputy National Security Advisor for International Economics Mike Froman pointed out after the presidents met that “Korea is a large and growing market. It’s the 14th largest economy in the world. We export about $50 billion worth of goods and services to Korea, and this trade agreement is expected to add another $10 billion, $10 billion to $11 billion a year just in goods, and when services are added, substantially more than that.”

Froman noted that “The President decided to do this as part of our national export initiative to expand – double our exports over the next five years and increase the jobs – the good-paying jobs that are associated with exports, and to maintain a competitiveness of U.S. exporters and our engagement in Asia. Korea is a place where our market share of their imports has declined from 23 percent to 9 percent over the last 20 years. It’s got other actors in the field – the EU, Canada and others – negotiating free trade agreements with Korea and others. And the President decided that the U.S., in order to maintain and increase its market share in with some very important markets who export both goods, services and agricultural products, that the free trade agreement – he would move forward with the free trade agreement if we can resolve the outstanding issues.”

Froman also outlined the agenda between now and November: “We are first going to complete some consultations with Congress and stakeholders. We’ll then enter into discussions with the Koreans with the goal of resolving the outstanding issues, which include, as I mentioned, non-tariff barriers in the auto sector and in the beef sector. And that will be our objective between now and November. . . There’s been a fairly clear consensus as to what those outstanding items are and there’s a willingness on both sides to sit down and try and resolve them.”

For more coverage of the three stalled FTAs, including a forecast that “the U.S. FTA with South Korea alone would add $10 to U.S. hog prices,” go to: www.agri-pulse.com/20100624M2_Canada_Colombia_FTA.asp

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