(EDITORIAL from the Korea Times on Nov. 23)

FTA Renegotiation
Korea Should Not Send Wrong Signal to US

The future of the South Korea-U.S. Free Trade Agreement (FTA) has taken a new
twist since last week's summit between President Lee Myung-bak and his American
counterpart Barack Obama. Lee said in a joint press conference with Obama in
Seoul on Thursday that Korea is willing to ``talk'' with the United States about
the latter's concerns on potential damage to the American auto industry from the
enactment of the trade deal. His remarks have immediately sparked speculation
that Seoul has offered to renegotiate the FTA with Washington.
Korean officials were busy dismissing the speculation. On Friday, Cheong Wa Dae
ruled out the possibility of holding renegotiations of the FTA between the two
countries. It even said that Korea will raise its own concerns should the U.S.
demand any change to the deal which was signed in June 2007. Such concerns are
apparently about market openings in the domestic agricultural sector.
Foreign Minister Yu Myung-hwan also said that the government will not renegotiate
with the U.S. on the FTA. He told lawmakers at the National Assembly that the
President was not referring to a renegotiation but was taking an ``offensive''
stance on the U.S. for raising issues with the FTA's auto provisions. We have to
point out that Lee was not careful in his remarks which might have sent the wrong
signal to the Obama administration and the Democrat-controlled Congress which is
reluctant to ratify the FTA.
Lee had better not go beyond his agreement with Obama on the FTA. Lee said,
``President Obama and I reaffirmed the economic, strategic importance of the
South Korea-U.S. FTA, and we agreed to move forward on the deal together.'' This
was enough for Lee to convey Seoul's intention to call on Washington not to delay
further in pushing the FTA through Congress. But Lee went a little bit too far in
implying that his country is ready to address U.S. concerns.
As officials explained, President Lee wanted to express his willingness to listen
to the problems with the American automobile industry. However, even if that is
the case, Americans could interpret Lee's remarks as indicating that South Korea
would accept repeated U.S. calls for renegotiation of the FTA to correct what
they call unfair, at least in the auto trade.
According to media reports, the Office of the U.S. Trade Representative (USTR)
plans to come up with a new package on the auto industry after consulting with
Congress. The U.S. may use the package to launch a formal renegotiation of the
FTA with Korea. Besides, Rep. John D. Dingell, D-Michigan, reportedly submitted a
draft resolution to the House of Representatives last week that calls for a halt
to ``unfair'' auto trade between Korea and the U.S.
U.S. lawmakers, trade officials and automakers need to think what's really
causing an imbalance in the bilateral auto trade. They must realize that the
imbalance is the direct result of the American auto industry losing
competitiveness, not South Korean trade barriers. It is doubtful that a possible
modification of the FTA will successfully fix this. Opening renegotiation talks
on the FTA is also feared to set a bad precedent which could be seen as
Washington's trade pressure on Seoul. We hope the two sides will smoothly address
this sensitive issue in order to bring prosperity to both countries through freer
trade.
(END)