South Korea: No renegotiation of FTA with US

By KELLY OLSEN

The Associated Press-Google

Nov 6, 2008

SEOUL, South Korea (AP) — South Korea said Thursday that a free trade agreement with the U.S. stands as is, resolving to resist possible calls to redo the deal by the new administration of President-elect Barack Obama.

"I repeat that there will be no renegotiation, whether it's automobiles or any other issue," said Trade Minister Kim Jong-hoon, according to a transcript of an interview with local radio network KBS. "We will respond by sticking to such a stance."

Kim's comments came one day after his deputy Lee Hye-min told reporters that reconsidering the already signed agreement would be like opening a "Pandora's box" and "could damage the balance reached when the deal was concluded." Kim served as South Korea's chief negotiator for the U.S. agreement before becoming trade minister.

The accord to slash tariffs on goods and services is the largest for the U.S. since the North American Free Trade Agreement with Canada and Mexico and the biggest ever for South Korea. NAFTA, signed in 1993, took effect the following year.

The U.S. and South Korea engaged in 10 months of tough talks that were only concluded minutes ahead of a deadline in April last year.

The agreement, signed nearly three months later, has yet to be put to a vote in either in U.S. or South Korean legislatures. Both must approve the deal for it to take effect.

Anti-free trade sentiment in the U.S. Congress, uncertainty over the outcome of the presidential election and a bilateral beef dispute that has been largely resolved have held up ratification.

Obama, a Democrat, has said he is in favor of free trade that benefits the United States, but has strongly criticized the deal with South Korea, saying it does not adequately address an imbalance in auto trade.

South Korean automakers sold 772,482 vehicles in the United States in 2007, while Detroit sold 6,235 in South Korea, according to statistics compiled by South Korean auto industry groups.

Under the free trade deal, the two sides agreed to cut and phase out tariffs on autos, while South Korea committed to changing its tax system for larger vehicles, which the U.S. claimed was discriminatory.

Frank Jannuzi, an Obama foreign policy adviser, was quoted by South Korea's Yonhap news agency in a dispatch from Washington on Tuesday as saying that Obama favors ratification of the FTA, though on conditions including "strengthening of the access of American automobile exports to Korea."

Kim, Seoul's trade minister, said in the radio interview that the U.S. auto industry's difficulties are of its own making.

"The solution to the problems in the U.S. auto industry isn't to be found with us," Kim said, adding that Detroit should strengthen its competitiveness.

Separately, South Korean President Lee Myung-bak and Obama planned to speak by telephone Friday to discuss ways to establish a stronger bilateral alliance, Yonhap reported, citing Lee's spokesman.

Source: The Associated Press

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