Lee stresses long-term benefits of US FTA
By Na Jeong-ju
President Lee Myung-bak said Monday his administration made some concessions on automobile trade to reach a free trade deal with the United States, but it will bring much bigger long-term benefits to the country.
“We need to evaluate the Korea-U.S. free trade agreement (FTA) comprehensively rather than just focusing on certain fields,” Lee said in a pre-recorded biweekly radio address.
“I’m confident that the agreement will not only enhance the overall competitiveness of Korean firms, but also boost Korea’s international status. It will also help to create more jobs.”
Lee stressed that Seoul’s security alliance with Washington will subsequently become stronger through the closer economic ties.
The two allies completed protracted additional talks earlier this month to amend some terms of trade to the agreement, initially signed in 2007.
While the U.S. side has generally expressed satisfaction with the latest deal, the Lee administration faced a strong backlash at home. Critics argue Seoul gave in to U.S. pressure to make too many concessions on auto-related issues.
With both governments set to seek ratification from their respective legislatures, Korea’s opposition parties, including the Democratic Party, have vowed to reject the deal.
President Lee tried to seek public support for the agreement, saying his government had no choice but to pay some sort of price for the sake of larger gains.
“Through the FTA with the U.S., Korea will become the country with the largest economic territory in the world,” the CEO-turned-President said.
If the accord goes into effect, the country will become the only country that has FTAs with the world’s top three economic blocs the U.S., the European Union, and ASEAN plus India.
It is also in talks with a dozen other countries including Canada, Australia, Turkey and Colombia. Seoul is in working-level consultations with China and Japan to start negotiations.
Lee downplayed concerns that his government yielded too much on auto trade by accepting Washington’s demands that tariffs on South Korean vehicles be maintained for the time being.
Korea, he pointed out, exported 950,000 cars to the U.S. this year, but imported only 12,000 vehicles from the U.S.
“Since our automobiles are highly competitive, we sought to gain bigger economic gains by making some concessions,” Lee said.
He noted once the existing 4-percent tariff on automobile parts is abolished under the deal, Korea’s small and mid-sized parts makers will be able to increase their share in the world’s largest automobile market.