By Phil Eskeland
What does the looming vote in the U.S. House of Representatives on Trade Promotion Authority (TPA) for the President have to do with Korea? While Korea is currently not party to the Trans Pacific Partnership (TPP) talks, on the surface, the TPA debate appears not to affect Korea all that much. However, there is much at stake not only for Korea but for U.S. leadership in the Asia-Pacific region. Without TPA, the TPP talks will not conclude and slip into the next U.S. presidential administration, further delaying the opportunity for Korea to join the TPP. If TPA is defeated in Congress, it will send yet another message to the world that Washington is completely dysfunctional – even when a Democrat President and a Republican Congress agree on something, they still can’t get anything done.
Nonetheless, the U.S. experience with the Korea-U.S. Free Trade Agreement (KORUS FTA) is currently being cited in the TPA debate. First, opponents of TPA and TPP have selectively used recent Korea-U.S. bilateral trade data as one of many talking points to deny TPA for President Obama and discredit the post-WWII consensus for advancing free trade and economic opportunity around the world. However, U.S. exports to South Korea saw an uptick in 2014 to hit record levels, even as the U.S. dollar increased in value. As a result, opponents of TPA/TPP shifted the attack to the growing bilateral trade deficit in merchandise goods between the U.S. and Korea. The reality is that both countries saw an increase in trade with each other, which demonstrates the KORUS FTA is far from a failure but a win-win for both sides.
When the U.S. Senate debated TPA last month, anyone could look at trade data from the U.S. Department of Commerce to determine the value and composition of exports from an individual state to Korea or to the Asia-Pacific region as a whole. Unfortunately, there is no comparable data for House districts. There is no definitive source of information related to exports to South Korea from individual Congressional districts.
Until now. The Korea Economic Institute of American (KEI), utilizing U.S. government-collected data provided by The Trade Partnership (Washington, D.C.), fills this gap by demonstrating the vital role Korea plays in the economic livelihood of each individual Congressional district, including the number of jobs directly or indirectly created or sustained by exports to Korea. While one might correctly assume that districts in large states such as California and Texas would dominate U.S. exports to Korea, data analyzed by KEI shows a few surprises. For example, while not in the top 10 list of exporting districts, the Seventh District of Indiana (Indianapolis) sold $446 million worth of goods and services to Korea, mostly in pharmaceuticals and other medicine products. The Sixth District of Massachusetts (Burlington) also sold $438.5 million worth of goods and services to Korea, mostly in aerospace products and parts.
Because international economic relationships are more than just imports and exports, KEI also complied data gathered by the U.S. Department of State to determine the extent and level of foreign direct investment (FDI) from South Korea into specific Congressional Districts. Between 2010 and 2014, Korean companies invested over $14.4 billion in 67 Congressional districts, resulting in the expansion or creation of over 20,000 jobs in the United States. According to Select USA, U.S. subsidiaries of South Korean firms provide an average yearly salary of $83,000 for their workers and contribute to nearly $10 billion in exports of goods from the United States.
Finally, KEI also included the results from the American Community Survey of the U.S. Census Bureau estimating the number of residents in a particular Congressional district of Korean descent. Again, while one might correctly assume that Korean Americans reside primarily in the Los Angeles or New York metropolitan area, there are Korean Americans living in every Congressional district. For example, over 21,000 Americans of Korean descent reside in the Seventh District of Georgia (northeast of Atlanta).
If you want to find the most up-to-date information regarding the amount and composition of goods and services exports to Korea, along with the associated jobs, from a specific Congressional District; if you want to see how much FDI came into a particular Congressional District from Korea, along with the number of jobs, over the past five years; or if you want to find out how many Americans of Korean descent reside in a Congressional District, then please visit the website of KEI – www.keia.org and click on “Congressional Trade Statistics” underneath the “Research” icon on the top of home page. Then select the specific Congressional District you would like to examine. You can also click here.
I encourage those interested in the U.S.-Korea relationship to peruse this exciting new statistical tool.
Phil Eskeland is Executive Director for Operations and Policy at the Korea Economic Institute of America. The views expressed here are his own.
Photo from Kim Daram’s photostream on flickr Creative Commons.