Defending the FTA

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Defending the FTA

U.S. President Donald Trump admitted that his administration was considering nullifying the five-year bilateral free trade agreement with Korea. When asked to confirm media reports that he has asked advisers to pull out of the FTA, Trump said “I am . . . It’s very much on my mind,” during a visit to hurricane-devastated Houston on Saturday. Korean trade officials maintained that Washington was seeking “modifications” in the terms instead of outright renegotiations. Walking out of the deal would have stunned Seoul officials.

The comment could be more political rhetoric ahead of mid-term elections next year. Trump may be reviving his “America First” slogan that won him the presidential title by threatening to do away with free trade deals he claims have damaged U.S. trade and jobs.

Terminating a symbolic free trade pact with South Korea, however, would not be that easy as it could send the wrong message to North Korea about the alliance between South Korea and the United States at a time when North Korea has pushed brinkmanship over nuclear and missile programs to the limit. His security aides, like National Security Adviser H.R. McMaster and Defense Secretary Jim Mattis are said to be strongly opposing the move for security reasons. The plan also upsets the business community. The American Chamber of Commerce and Industry warned the termination of the trade deal with South Korea could wreck the White House relationship with the industry and farming sector. The U.S. Manufacturers Association also advised quick action among government officials, lawmakers and governors to prevent the breakdown in the deal. Trump’s move to overthrow the deal may likely be challenged by the legislative as even the Republican Party is against killing the trade pact.

But we nevertheless must be fully prepared. Seoul has ruled out the possibility of Washington jeopardizing the deal itself. But its blunt talk suggests Trump is serious about rewriting the terms of the agreement. Seoul must demand a joint study on the FTA impact on the two economies to ensure objective grounds to argue against the United States. At the same time, the government, political and business sector should join forces to build allies in Washington and U.S. businesses.

JoongAng Ilbo, Sept. 4, Page 34
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