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Whither the KORUS FTA? The Moment of Truth
Published May 25, 2011
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Two years and nine months have passed since Korea and the United States put their signatures on the Korea-U.S. Free Trade Agreement (KORUS FTA). Nei- ther Korea nor the United States has yet ratified the agreement. Nonetheless, the countries’ trajectories leading to the present have been significantly different. In spite of political opposition and fierce protest, the Korean governing party has been taking painful steps toward ratification in the National Assembly. Through thunder and storm, the ratification bill cleared the first hurdle of the Committee of Foreign Affairs, Trade, and Reunification in December 2008. No such com- parable effort has even begun in the United States.

The nature of the majority of the governing party in the National Assembly means that ratification in Korea is not a matter of whether, but of when. The fate of the KORUS FTA in the United States is less and less debated in political circles, thereby causing suspicion about the U.S. commitment to free trade. Delayed ratification in Washington was not entirely unpredictable when the KORUS FTA was entered into agreement in June 2007. The House of Representative of the U.S. Congress was then controlled by the Democrats, who were openly criti- cal of the Bush administration’s drive for an FTA. However, few would have predicted this much prolonged delay and inaction.

In 2008, while the Democratic Party’s presidential candidates in the United States were busy bashing the KORUS FTA as unfair, the newly elected Korean president was trying to carry out the former Korean president’s commitment to the unrestricted import of the U.S. beef, as he placed the highest priority in global affairs on the Korea-U.S. alliance. As it turns out, political naiveté and Internet politics almost blew away his presidency in his very first year.

Now with a Democratic president in the White House and Congress dominated by the Democratic Party, free and open trade has taken a back seat. President Barack Obama’s track record in keeping the U.S. commitment to free trade has been disappointing. He succumbed to pressure from labor unions and sided with them at the expense of Mexican trucking services and Chinese tires. Even though Obama and his staff do not continue to assail the KORUS FTA as unfair, as they did during the election campaign, it is equally true that they do not seem to have any clue how to move the KORUS FTA forward. And it is not just the KORUS FTA but two other FTAs—one with Panama and the other with Columbia—concluded by the Bush administration as well as the Doha Round of multilateral trade negotiations launched in November 2001 for which the Obama administration has failed to develop a strategic plan to move forward. In Washington, it is no longer a secret that the U.S. initiative of free and open trade, which helped to create and maintain the global trading system, is an endangered species.

Although U.S. domestic politics is embroiled in other important domestic busi- ness such as health care reform, climate change, and Afghanistan, Korea has been vigorously pursuing FTAs. During the unfolding global economic crisis, this Korean drive is all the more remarkable. In July 2009, Korea struck a deal with the European Union (EU) to create an FTA between Korea and 27 members of the EU. Korea also concluded an FTA with India, and it became effective. Korea’s negotiations with Australia and New Zealand are also moving along. These developments imply that delayed ratification of the KORUS FTA is most costly. Nonetheless, U.S. politicians seem oblivious to this.

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