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North koreans protest US farm product flooding { April 2 2007 } Original Source Link: (May no longer be active)
http://www.boston.com/news/world/asia/articles/2007/04/02/south_korea_us_seal_trade_deal_at_last_minute/http://www.boston.com/news/world/asia/articles/2007/04/02/south_korea_us_seal_trade_deal_at_last_minute/
South Korea, U.S. seal trade deal at last minute
By Jack Kim | April 2, 2007
SEOUL (Reuters) - The United States and South Korea agreed on the biggest U.S. trade pact in 15 years on Monday with only minutes to go before a deadline.
The deal to cut tariffs and remove trade barriers follows nine months of talks and sometimes violent protests in South Korea, mostly over fears that heavily subsidized farmers could not survive a flood of cheaper U.S. farm products.
But some U.S. politicians and businesses slammed the deal just hours after it was agreed, saying the pact doesn't do enough to boost U.S. auto and beef exports. Differences remained, too, in U.S. and Korean accounts on exports from an industrial park just inside North Korea.
"We expect the ... (agreement) would provide a stepping stone that would catapult Korea into an advanced economy," a press official quoted President Roh Moo-Hyun as saying.
U.S. negotiators called the pact strong and innovative.
"In the agricultural sector, you're going to see substantial new market access for America's agricultural producers in a fast growing, wealthy market ... it's a great deal for America's farmers and ranchers," Deputy U.S. Trade Representative Karan Bhatia told reporters.
Seoul agreed in the end to phase out its 40 percent tariff on U.S. beef over 15 years, but did not budge on the most sensitive, and heavily protected, farm product -- rice, something Bhatia said he wished had been included.
Early reaction suggested the deal could face difficulties in the U.S. Congress. Sen. Max Baucus, the Montana Democrat who chairs the Senate Finance Committee, threatened to block the deal, which he called an "entirely unacceptable outcome."
He wants Korea to accept U.S. beef imports that have been blocked in a dispute that, while not formally part of the trade deal, has cast a long shadow.
ASIA'S THIRD LARGEST ECONOMY
On another major sticking point, the two agreed to open their markets more to each other's autos. Bhatia said the struggling U.S. auto industry would be helped by the deal.
"We have in this agreement an unprecedented set of provisions to help ensure that American automobile manufacturers ... will gain a level playing field," he said.
But the Automotive Trade Policy Council, which groups three major U.S. car producers, said the deal fell short of expectations.
The accord between the United States and Asia's third-largest economy was struck just minutes before time ran out for the White House to use legislation allowing it to present a deal to Congress that can be rejected or accepted, but not changed. If the deadline had been missed, talks would likely have dragged on for years.
Some estimates say an agreement could add $20 billion to the already more than $70 billion of two-way trade each year.
But discrepancies lingered in Korean and U.S. accounts of one of the talks' more controversial areas. According to South Korean officials, the United States agreed in principle to give certain products from North Korea preferential treatment.
That would be a concession to South Korea, which wanted the goods it makes in an industrial park just inside North Korea to be treated the same as those made at home.
"Not only Kaesong but all parts of North Korea will benefit from this," Roh later said in nationally televised remarks.
U.S. trade official categorically rejected that idea.
"I can tell you there's no contemplation on the United States' part right now to allow goods from North Korea into the U.S. somehow through the FTA. That won't happen," Bhatia said.
Sean Spicer, a spokesman for U.S. Trade Representative Susan Schwab, said the United States was willing to discuss the park in the future but would not consider changing its stance.
President George W. Bush, in a letter to Congress released by the White House, said the agreement would bring export opportunities for a range of U.S. businesses, promote economic growth and provide jobs.
"(It) will also further enhance the strong United States-Korea partnership, which has served as a force for stability and prosperity in Asia," he said.
(Additional reporting by Jessica Kim, Rafael Nam, Rhee So-eui and Kim Yeon-hee in Seoul and Missy Ryan in Washington)
© Copyright 2007 The New York Times Company
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