Invest KOREA

The Obama administration Wednesday reaffirmed its commitment to clear the pending free trade deal with South Korea through Congress before July 1, with the hope that Congress will begin deliberations early next month.

   "The July 1 number is relevant because the Korea-EU FTA was to have been implemented," U.S. Trade Representative Ron Kirk told Yonhap News Agency after attending a forum at the School of Advanced International Studies at Johns Hopkins University.

   He added that the Korean FTA with the European Union will pose "some challenges" for the U.S. in South Korea, the seventh biggest trading partner for the U.S.

   Kirk has urged Congress to approve the Korea deal "this spring" so as not to lag behind the EU, which ratified a similar deal with Seoul set to take effect on July 1.

   The top U.S. trade official recalled that he "sent Congress a letter six weeks ago, advising them to begin discussion" on the Korea FTA's deliberation.

   "We want to move it as soon as we can," Kirk said. "We have advised Congress that we are ready to begin the markup with them. Hopefully, they will come back from their recess and we will begin that discussion." Congress is in recess until early next month.

   As to pressure from some congressional Republicans on President Obama to submit the Korea deal along with similar ones with Panama and Colombia, Kirk said the Korea FTA will be submitted first. "They will be presented separately."

   Republican congressmen have threatened to block Obama's nomination for Commerce Secretary Gary Locke's replacement unless the Panama and Colombia deals are sent together with the Korea FTA. Locke has been appointed U.S. ambassador to China.

   Kirk also said he hopes the South Korean National Assembly will soon approve the Korea FTA.

"Secretary Clinton was in South Korea last week," he said. "We have a congressional delegation there, I think even yesterday, led by Sen. Mitch McConnell and everyone. Democrats and Republicans have reaffirmed our strong commitment to support for President Lee to get this done and expressed their likewise desire we hope the Korean Assembly will approve it expeditiously as well."

   Senate Minority Leader McConnell (R-Kentucky) led a group of several senators to Seoul and met with South Korean President Lee Myung-bak Tuesday, expressing their support for the free trade deal and calling for early ratification of the deal on the Korean side.

   South Korea's ruling Grand National Party (GNP) is waiting for the U.S. Congress to approve the Korea FTA first before it moves for the deal's ratification. The liberal major opposition party opposes the deal due to fears of an adverse impact on the agricultural industry.

   While in Seoul last week, Secretary of State Hillary Clinton expressed "our strong commitment to ratifying, through our Congress, the Korean free trade agreement by the end of this year," saying, "It is probably one of my top priorities for the next months. We are determined to get it done, and I believe we will."

   Kirk last week repeated calls on Congress to move "now" to ratify the Korea deal, saying similar deals with Colombia and Panama will be ready "in a matter of weeks."

   An agreement with Panama took effect Monday, allowing exchanges of tax information to stave off tax evasion in the Latin American state often criticized for serving as a tax haven.

   Washington also reached a new deal with Bogota early this month on labor rights, which have served as a stumbling block to congressional approval of the trade agreement since its signing in 2007.

   Washington and Seoul produced a supplemental deal in December to address U.S. concerns over lopsided auto trade, the biggest hurdle to congressional approval. The deal calls for a delayed phaseout of auto tariffs in return for Washington's concessions on pork and medicine.

   When asked about the administration's pledge to clear the Korea FTA through Congress by July 1, Michael Froman, deputy national security adviser, said Tuesday, "That will be part of the discussion we have between the administration and Congress on how to sequence, time and package the whole trade agenda."

   The Korea FTA, the biggest trade deal for the U.S. since the North American Free Trade Agreement in 1994, was negotiated under the Trade Promotion Authority Act of 2002, which requires Congress to vote yes or no without amendments within 90 days of the deal's submission.

Source: Yonhap News (April 20, 2011)