The dice has been rolledThe free trade agreement between Korea and the United States officially took effect on Thursday. A total of 8,628 Korean commodities, including motor vehicles, become tariff free in the U.S. and likewise for 9,061 American imports, including wine and bags, in Korea. Most Korean export items will be sold without tariffs in the world’s largest market. Most U.S. items will enjoy the same status here. Opportunities will become bigger and the competition more fierce. Despite challenges from the market opening further, Korea cannot lose this monumental chance to advance as a trading powerhouse. We have gained experience and resilience from prior free trade deals with Chile and the European Union.
A free trade pact does not simply increase exports but can also boost individual income and jobs. With a small market at home, we have to seek a greater source of revenue from overseas markets through free trade. The opposition party and some civilian groups still oppose the deal and demand renegotiation on the revised pact. Some of the clauses might be unsatisfactory. But reversing it would cause greater loss to the economy and undermine the country’s international credibility. The opponents to the Korea-U.S. FTA will have to come up with a better solution to increase income and jobs.
But a free trade framework does not automatically generate new revenue and jobs. Exporters must produce competitive commodities to augment their price appeals from tariff cuts. The local economy and players must strengthen fundamentals in order to weather challenges. Multilateral endeavors must take place in order to maximize benefits from the pact. We must stop debating about scrapping the deal and come together to find ways to bolster positive returns.
The government must offer its full support to large as well as midsized and small exporters in their new trade environment in the U.S. At the same time, it must keep watch on the market to ensure a fair trade environment at home amid the cascade of cheaper American imports. Authorities must accelerate efforts to subsidize and support the weaker agricultural, pharmaceutical and services sectors. It must seek public and expert advice to coordinate the terms related to the investor-state dispute settlement clause as promised in return for the ratification of the trade deal.
The dice is down. We must now stop all the arguing over the deal. Instead, the government, politicians and industry must unite to prove the Korea-U.S. FTA was the right choice for the country.