[Special contribution]FTA: It’s time to make it happen

American and Korean trade negotiators began their seventh round of Korea-United States free trade agreement negotiations in Washington on Sunday.
This negotiation has been so exhaustively chronicled, debated and scrutinized in Korea that my Korean friends are surprised when I point out this process has been going on for only eight months. The benefit of this extensive debate is that here in Korea there is excellent comprehension of the principal issues in the negotiation ― not just among trade negotiators and economists, but in the National Assembly (where a special committee was formed to analyze FTA issues), in the business community and civil society, in the media and among the public.
That’s why it is particularly gratifying to see that public support for the agreement here in Korea has remained solid. The most recent poll shows 51.5 percent of respondents saying they believe the trade pact will promote Korea’s national interests. Given global ambivalence about the concept of trade liberalization, that’s an impressive figure. It’s especially impressive for such a large, high-profile negotiation and despite the large-scale protest movement the negotiations have engendered. That underscores that to a degree that is frequently obscured by rhetoric, Koreans have often demonstrated a readiness to liberalize when they believe it serves Korea’s interests to do so ― and now, with poll after poll showing Koreans concerned about how to boost slowing economic growth, is just such a time.
After making solid progress over the past eight months, we are now entering the final phase of FTA negotiations. Both the U.S. and Korean governments have made clear that notwithstanding President Bush’s recent request to Congress to extend trade promotion authority legislation (by which Congress authorizes the president to conduct trade negotiations), we are both committed to completing this negotiation before the current authority expires. That will mean completing negotiations before the end of March. To prolong them further would only complicate our efforts to reach agreement.
It is perhaps inevitable that as these negotiations approach their conclusion, the activity surrounding them is going to increase further. Groups that will lose their special protections, or that feel threatened by the FTA ― or that simply reject the concept of trade altogether ― will see that a deal is within reach, and ramp up their efforts to defeat it, or at least carve out their own sector.
We’ll be told that any final agreement that does not contain that special treatment will somehow be fundamentally unfair, or unbalanced, and should not be ratified. The commentators will look at the difficulty of resolving the most politically sensitive issues, and express skepticism that a final deal can be reached.
Against that backdrop, we need to bear in mind why we launched this process. The economic arguments for the FTA are unambiguously positive for both countries.
Removing tariffs and non-tariff trade barriers to the flow of goods and services between the United States and Korea will boost exports in both directions and create new wealth-generating opportunities for both countries.
Bilateral investment will rise, as additional sectors are opened to investors from the other country, and as other provisions in areas like transparency, intellectual property and competition policy help create a more hospitable climate for foreign investment.
Thanks to the effects of the FTA in introducing more competition, and promoting more efficient resource allocation, economic growth will accelerate. For Korea, this presents the prospect of raising the productivity of its relatively under-developed service sector.
Finally, the FTA will reinforce and modernize the United States-Korea partnership, augmenting our security alliance that for half a century has played such an important role in maintaining peace and stability in the region.
As our FTA negotiators work out solutions to the most politically sensitive issues, we cannot lose sight of these overall benefits. Trade agreements inevitably require adjustments in certain sectors. However, if we allow our anxieties about these adjustments to tempt us to freeze the status quo in place and back away from a comprehensive, high-quality agreement, we will miss out on most of the potential benefits from the FTA. Future generations will not forgive us for being so short-sighted.
The free trade agreement is a once-in-a-generation opportunity. Our shared commitment to realizing that opportunity has enabled the United States and Korea to make strong progress in the negotiations, and put us within striking distance of an historic agreement. Now, as FTA negotiations enter their most challenging stage, we must remain focused on the economic benefits, and not be paralyzed by the political challenges.
We can make this deal happen.

*The writer is the U.S. ambassador to Korea.

by Alexander Vershbow