KEI Spotlight

February 25, 2013 – KEI's Troy Stangarone was quoted in the most recent Nelson Report. His statement on South Korea and TPP was as follows:

"WHAT ABOUT S. KOREA AND TPP? Will Japan's apparent move force the hand of Pres. Park? Remember at a KEI conference here last Fall, we reported Trade Minister Bark Taeho saying his government "could join TPP tomorrow because of all the work accomplished to complete KORUS", the US-ROK FTA.

He added, however, that sheer staff over-load with all the current and already planned trade negotiations would make that a bridge that Seoul would rather wait before crossing.

KEI's Troy Stangerone, just back from 6 months in Seoul with the ASAN Institute, agrees. His read of the situation now:

Chris,

I'm actually wondering what it is that Japan might announce. While I haven't followed every country's position on Japan, I'd note that each TPP member has to negotiate Japan's entry. If any object, Japan could be on the outside. And this means Tokyo will have to deal with ag/rice and other issues with each.So I'd just like more details before we know they are in!

As for Korea, I don't think that we'll see them join soon. I'd be surprised if they did in 2013. The opposition is holding up the planned governmental reorganization, so it's unclear when that will happen. So for the moment, Park is still functioning with Lee's ministers.

I also think there is less pressure for Korea to join right away (the idea that Japan had to join if Korea did was always stronger than the converse). A couple considerations I'd put forward from the Korean perspective:

They already have or are in the process of negotiating deals with most of the countries involved in the TPP. In terms of bottom line benefits, the RCEP is worth more to Korea because their deal with ASEAN isn't up to KORUS standards. Given Park's stress on creating jobs, I'd expect her to focus more on high level RCEP than spreading herself thin with TPP. The capacity issues are real. They just don't have the staff to do RCEP, TPP, Korea-China, and Korea-China-Japan.

China has been pushing hard for them to do the bi-lat, so I doubt they would pull staff from it, given Park's desire to improve relations with Beijing. Though, if one of the other deals moved in a less serious direction – which I could see RCEP or K-C-J doing – I could see them moving towards TPP then.

One last factor on TPP. I'm not sure there is the political desire to do this now. When I was in Seoul, I did some polling on KORUS and a slight majority of Koreans see it as being one sided in the United States favor. Given the political efforts another U.S. deal might take, I could see them wanting to wait before jumping in again."