[GLOBAL EYE]Work for a win-win agreementThe competition over “mating” between countries and regions through free trade agreements is unusual. One hundred and twenty free trade agreements have been entered to date ― 95 of them in the past five years. Fifteen agreements were reached last year and 37 are currently underway. Immediately after he came into office in 2001, U.S. President George W. Bush pushed to enter free trade agreements, saying the United States was behind the European Union in making such pacts. The United States has signed six agreements in the five years since then and negotiations for nine others are in process. Since 2003, South Korea has pursued pacts with many countries simultaneously, concluding one with Chile. Agreements with Singapore and the European Trade Association will go into effect soon.
When the world is making strenuous efforts to realize multilateral trade liberalization centered on the World Trade Organization, the competition over bilateral and regional “mating” seems to be contradictory. Free trade agreements have two aspects. They are steppingstones to liberalization in the sense that countries with identical or complementary goals first enter free trade agreements then ultimately realize global trade liberalization by broadening their scope. On the other hand, “free trade pacts between countries concerned” can be exclusive to others in the short and mid-term periods. The WTO system is seeing a rough going due to the resistance of anti-globalization and anti-liberalization forces. If the WTO system ends in failure, bilateral and regional agreements will become the minimum safety net to avoid trade wars. Therefore, unless a country is closely knitted into a web of free trade agreements, it is bound to be a loner. Although the world’s 11th-largest trading power, Korea is a latecomer in making such agreements.
In this regard, an agreement between Korea and the United States is not a matter of choice but one of necessity, and the sooner the better.
Some strongly argue that trade agreements should be made with China and Japan first but, despite six previous negotiations, an agreement with Japan is at a deadlock, and China has yet to meet the qualifications to join the World Trade Organization. The United States is our second-largest export market, behind China, and Korea is the seventh-largest trading partner of the United States. For this reason, an agreement between Korea and the United States is drawing attention worldwide as the biggest event in 15 years, since the North American Free Trade Agreement was reached.
Free trade talks with the United States make us prejudiced that we will be victimized by opening our markets to the United States. Even under the present WTO system, however, it is inevitable to additionally open up the agricultural products and service sectors that we are worried about. We should take this opportunity of entering a trade agreement to form a new framework for our agriculture sector and upgrade our service industry. It is most important for us that, by entering an agreement, trade friction between Korea and the United States will be resolved within the framework of the agreement and we will be able to secure a foothold in the American market, which is stable and predictable, on the short and mid-term bases. We can be in an advantageous position in future negotiations with China and Japan and we cannot ignore the secondary benefits, including a competitive edge over rival countries.
Above all, a Korea-U.S. free trade pact can provide a turning point in bilateral relations, including the shaky Korea-U.S. alliance, to improve and develop it into a comprehensive alliance. If Korea becomes a stronghold in Asia for U.S. businesses and capital, we can have the momentum to pursue security as well as the idea of becoming the hub of Northeast Asia. To the Roh Moo-hyun administration, which has been at odds with the United States, entering a free trade agreement is an unbelievably momentous decision. Alexander Vershbow, the U.S. Ambassador to Korea, even gave significance to the trade pact as a “confidence vote to maintain solidarity between the two countries.”
The problem is that Korea-U.S. relations can worsen over the short to mid-term during the negotiation and ratification processes. If the negotiations are stranded or fail midway, the relationship can fall into fatal jeopardy. Preparing a system to solve conflict over opening up our markets and reaching a national consensus should go beyond the divide between pro-America and anti-America and pro-government and anti-government. Now is the time to gather national wisdom to realize a strategy in which both Korea and the United States can win.
* The writer is a senior columnist of the Joongang Ilbo.
by Byun Sang-keun
with the Korea JoongAng Daily
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