[VIEWPOINT]Many challenges in U.S. trade talks

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[VIEWPOINT]Many challenges in U.S. trade talks

A Free Trade Agreement between Korea and the United States will be a turning point that eliminates barriers to trade and investment between the two countries, speeds up economic development and establishes a meaningful economic relationship for both countries. Also, it will naturally solidify the strategic cooperation between Korea and the United States and show everyone that Korea is still an important partner to the United States. Therefore it can be said that a successful agreement with the United States will bring a lot of profits to Korea.
However, when the actual negotiations start in June, Korea will face many challenges due to various conflicts of interest, both domestic and international.
The first challenge is that the United States is not an easy partner to negotiate with. The United States has already signed trade pacts with 15 countries, and is now simultaneously negotiating with five other countries on trade pacts. Korea must keep in mind that the United States will use these experiences in the negotiations with us.
We must also watch carefully how the U.S. industrial community, which has an intensive knowledge about trade, closely cooperates with the government throughout the negotiating process. Through such close cooperation, the U.S. government can get fresh information and feel the sentiment in various industries that it would otherwise know less about. It can also utilize civilian trade specialists who are well versed in various legal and political theories related to trade disputes.
Korean corporations also need to provide the Korean government with diverse opinions from industry. It is the duty of the business community to have a clear understanding of the legal and political points of each trade dispute, collect information about rival U.S. corporations, and watch and predict their negotiating strategies.
The second challenge is that time is limited. The Trade Promotion Act of the United States, which stipulates that the Congress can only vote to endorse or reject the results of trade negotiations conducted by the administration, will expire on July 1, 2007. Considering that the Congress needs about three months for deliberations, the negotiations should be finished by mid-March 2007.
Since the negotiations should be concluded within less than a year, the Korean government and the business community should coordinate with each other on the speed and progress of the negotiations from the beginning. In order to do so, the business community should actively collect information on the free trade agreements that the United States has concluded with other countries, matters of interest to the U.S. side and measures to cope with them.
The third challenge is the possibility of change in the political climate.
In order to get approval of the Korea-U.S. agreement from the U.S. Congress, the agreement must have strong political support in the United States. However, the Bush administration’s influence on Congress is getting weaker due to the instability in the Middle East and continuous scandals involving leading figures of the Republican Party. Also, worries over the U.S.’s ever-growing trade deficit and the decreasing number of jobs in the United States are resulting in mistrust and animosity towards new trade pacts.
Even the Central America Free Trade Agreement, which was concluded in July 2005, only narrowly passed Congress by a margin of two votes, with the final tally of 217 to 215. That is how closely Congress is divided on free trade agreements.
With the falling popularity of the Bush administration and the rising support for protective trade, the U.S. negotiating team must show domestically results that they can boast about, rather than concessions made to Korea.
Therefore, it is time for Korea to come forward and persuade the leadership in Congress and other influential Americans who lead public opinion how much a Korea-U.S. free trade agreement will be helpful to U.S. foreign policy and national security.
The absence of former U.S. Trade Representative Rob Portman is another variable. As a member of Congress for over 10 years, Mr. Portman has maintained very close relations with both Republicans and Democrats. Now that such a figure is out of the picture, it may be hard for the U.S. government to win the support of Congress. The new trade representative, Susan C. Schwab, is well known as a trade and commerce specialist, but she does not have the political influence of Mr. Portman. It begs our attention to see how well she can overcome the increasing intervention by U.S. politicians, both from the ruling and the opposition party, in the process of negotiations for the conclusion of a Korea-U.S. free trade agreement.

* The writer is a managing partner at Akin Gump Strauss Hauer & Feld LLP in Washington D.C. Translation by the JoongAng Daily staff.


by Kim Suk-han

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