[EDITORIALS]Free trade makes us competitiveThe first round of meetings for a free trade agreement with the United States will open in Seoul tomorrow.
Currently, Korea is engaging in negotiations for free trade agreements with some 20 countries at the same time.
As the world’s 12th largest trading country, it is rather late to promote free trade agreements with many trading partners. Due to the absence of agreements, Korean businesses endure a lot of disadvantages. The United States, European Union, ASEAN countries and Mexico have concluded free trade agreements with more than 10 countries. Meanwhile, Korea has concluded only two, with Chile and Singapore.
Free trade agreements make it a prerequisite to give discriminative treatment to non-members. Mexico imports American cars without tax, but imposes 50 percent discriminatory customs duties on Korean ones. Non-tariff barriers are also high. Businesses from non-members are banned from public tender and have to go through complicated procedures to get certificates or customs clearances.
We enjoy the benefits of free trade with Chile after the ratification of the free trade agreement. Korea-Chile trade reached a historical high of $2.7 billion last year. Korea’s exports to Chile have increased more than 40 percent, but the rush of Chilean agricultural imports, as many feared, didn’t happen.
If we concentrate on domestic interest in free trade agreement negotiations, we will lag behind other countries. The United States has pointed out that Korea’s screen quota system is a trade barrier. Washington’s position is that a bilateral investment treaty with Seoul will make progress if the screen quota issue is resolved; if the bilateral investment issue is resolved, it will lead to the conclusion of a free trade agreement. During free trade agreement negotiations with Japan, products from Gaeseong Industrial Complex loomed as an obstacle. Since Japan has economic sanctions against North Korea, it says it can’t allow preferential tariffs on Gaeseong products. The contents of agreements change from simple trade to a more comprehensive exchanges including investment and tax. The drawbacks to non-members will grow even bigger.
In a free trade agreement negotiation, there is a counterpart. And the future of our economy depends on conclusion of free trade agreements. We shouldn’t let certain groups’ egoism damage our national interest.