U.S. chamber prods Korea on free trade agreement

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U.S. chamber prods Korea on free trade agreement

The vice president of the largest business lobbying group in the United States urged Korea to fully implement the free trade agreement the two countries signed in 2007 and that took effect more than two years ago.

In Washington, Tami Overby, the vice president for Asia at the U.S. Chamber of Commerce, told reporters it was the view of American businesses that if the agreement isn’t fully implemented, then it isn’t worth the paper it was written on.

Overby, the former president of the American Chamber of Commerce in Korea, said that the group has an extensive list of issues relating to the implementation of the accord and said they will be raised when President Barack Obama visits Seoul later this month.

In particular, Overby noted, parts of the accord dealing with automobiles, finance, pharmaceuticals and medical devices need to be fully implemented.

According to a researcher at the Institute for International Trade under the Korea International Trade Association (KITA), American businesses are mainly complaining about regulatory barriers.

“Issues related to tariffs are things that cannot be unimplemented,” said Je Hyun-jung, a research fellow at the institute. “That’s done. The issues that can be raised are regulatory policies related to industries affected by the Korus FTA.”

Je explained that it takes a long time for changes to be made in the local regulatory field because “there are many parties involved” and American businesses can find this frustrating because they are not benefitting as much as they expected from the FTA.

According to sources, the U.S. business group has received complaints from the American auto industry. One involved environmental regulations as the Korean government plans to impose more taxes on automobiles with larger engine sizes.

Overby told reporters there are non-tariff barriers in the auto sector and a lack of transparency in the financial sector.

The Wall Street Journal earlier this year reported that Seoul is the larger beneficiary from the Korus FTA as its surplus in bilateral trade widened to $17 billion in the first year and $20 billion in the second year after the agreement went into effect.

This isn’t the first time the U.S. Chamber of Commerce in Washington has complained about Korea not fully implementing the FTA. Last December, Overby noted that the Korus FTA is going well overall, but “it still faces some challenges including non-tariff barriers in the auto sector and a lack of transparency in financial fields.”

BY park seung-hee, lee eun-joo [angie@joongang.co.kr]

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