(EDITORIAL from the Korea Herald on March 13)

An unfair treaty?

When it comes to bilateral negotiations, it is the stronger that gets the upper
hand. It goes against common sense for the weaker to get a better deal at the
expense of his negotiating partner.
But that is exactly what Ron Kirk, the nominee for the post of U.S. trade
representative, implied when he recently referred to the Korea-U.S. free trade
agreement. He said at his Senate confirmation hearing, "The agreement as it is
just simply isn't fair, and if we don't get that right, we'll be prepared to step
away from that."
Kirk was speaking for the moribund U.S. auto industry when he complained about
the bilateral treaty, just as President Barack Obama did as presidential
candidate. Industry representatives said the treaty, when ratified, could not
serve to balance auto trade, which is in favor of Korea.
True, there is a severe imbalance in auto trade. In 2007 when the fair trade
agreement was signed after 14 months of negotiations, Korea exported 772,482
vehicles to the United States and imported 6,235 cars of U.S. origin.
The trade agreement could be seen as seriously flawed, as the Obama
administration claims, if it were designed to address autos and nothing else.
Instead, it covers overall bilateral trade.
The United States has more to gain from the mutually beneficial treaty than
Korea, according to studies conducted by various economic think tanks. Still, the
United States appears to be firm in its demand for more benefits.
Kirk said that the Obama administration would abandon the treaty if it was not
changed. Given these remarks, it is certain that the Obama administration will go
ahead with its demand for a revision. But it is not clear yet what change it
wishes to make and what concessions it is ready to offer in return.
But the Obama administration is ill-advised in pressing for more gains. This
demand gives the impression that the Obama administration is leaning toward
protectionism despite its disavowal. Such suspicion is bolstered by what Kirk
said about trade. He said, "I believe in trade and will work to expand it, but I
also know that not all Americans are winning from it."
Another problem is that such a demand will damage the trust Korea and other
countries have in the United States. No government in the world would be blamed
for wondering aloud if the outcome of its negotiations with the Obama
administration will survive the next change of government in the United States.
Moreover, a U.S. call for renewed negotiations, if perceived as undue pressure by
the Korean public, may kindle mass candlelight protests of the kind staged
against the resumption of beef imports from the United States last spring.
No wonder the Korean government is exercising caution in responding to Kirk's
remarks. It says that they cannot be accepted as an official proposal for
renegotiations or for negotiations concerning an amendment.
In commenting on Kirk's remarks in a radio interview, Trade Minister Kim
Jong-hoon said he had made no change to his policy against negotiating a new
trade treaty or a revision to the existing one. He said he found no reason to be
concerned about a "hypothetical" U.S. proposal.
But the Korean government has every reason to be prepared. After all, few agenda
items are as pressing as the fate of the agreement. One exception is the
denuclearization of North Korea.
The sooner it prepares for likely U.S. demands, the better, given that President
Lee Myung-bak is scheduled to meet Obama on the fringes of a G-20 summit in
London next month. The two leaders will have to lay the ground rules for future
talks on bilateral trade.
sam@yna.co.kr
(END)