US, SKorea set to sign free trade pact
Posted: 30 June 2007 1303 hrs

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WASHINGTON: The United States and South Korea are set to sign a landmark free trade agreement to be sent for Congressional approval, but US lawmakers are already saying they will not vote for it.

US Trade Representative Susan Schwab and Korean Trade Minister Kim Hyun-chong are scheduled to ink the pact on Saturday, just before President George W. Bush's "fast track" trade authority expires at midnight.

The Trade Promotion Authority (TPA) allows the Bush administration to negotiate trade pacts that cannot be amended by Congress but lawmakers can still reject them.

"We cannot support the (agreement) as currently negotiated," four powerful lawmakers from the Democratic party which controls Congress said in a statement after the Bush administration confirmed the agreement signing.

"Unfortunately, the FTA as currently negotiated is a missed opportunity," said the legislators, including Nancy Pelosi, the speaker of the House of Representatives.

Bush's Republican party lawmakers have also spoken out against the deal.

"I am one of the most ardent free traders in Congress and when I have problems with this, the agreement's got problems," said Republican Donald Manzullo from Illinois.

He vehemently objects to the pact's automobile provisions, which he said did not go far enough in dismantling barriers in South Korea.

Last year, for example, South Korea exported more than 700,000 cars into the United States while the United States exported fewer than 5,000.

The agreement is the biggest free trade deal since the 1993 North American Free Trade Agreement (NAFTA), and the two sides concluded negotiations on the pact on April 1 after 10 months of talks.

US-South Korea goods trade was valued at 78 billion dollars last year and studies indicate that the FTA will add anywhere from 17 to 44 billon dollars a year to the US economy.

Washington believes if the trade agreement is approved, it could trigger a wave of trade liberalization and economic reform throughout Asia, where it has such pacts only with Singapore and Australia at present.

South Korea is the seventh largest trading partner of the United States and a top military ally in Asia.

"From an economic standpoint, the potential benefits of the FTA to America’s workers, farmers, manufacturers, and service suppliers are undeniable," deputy US Trade Representative Karan Bhatia told a Congressional hearing recently.

But lawmakers, including Hillary Clinton, the top Democratic presidential contender, reject the argument.

Clinton had said the agreement was "inherently unfair" and would increase the US trade deficit, cost good middle-class American jobs and make America less competitive.

US lawmakers are also threatening to kill the deal if South Korea does not fully open up its beef market.

"I will not support this FTA until it does," said Democratic Senator Max Baucus, who heads the senate's finance panel, which has jurisdiction over US trade policy and considers all FTA's for presentation to the full Senate.

South Korea, once the third-largest market for US beef, last year lifted a three-year ban imposed to keep out mad cow disease. But it agreed to accept only shipments of boneless meat.

It gave an assurance earlier this year that it would consider a wider opening of its beef market if the World Organisation for Animal Health (OIE) issued a ruling that mad cow disease was under control in the United States.

The OIE gave the all-clear sign last month.


- AFP/so