The Time is Now: U.S. - Korea Free Trade Agreement
Last week I had a unique opportunity to hear the Korean Ambassador to the United States, Han Duk-soo, speak at a luncheon in East Lansing, Michigan. The event was sponsored by the Global Business Club of Mid-Michigan. The ambassador has been traveling to various locations throughout the Midwest to tout the benefits of passing a Free Trade Agreement (FTA) between the United States and Korea. Currently, the agreement has been tabled by Congress due to other higher priority matters.
Free Trade Agreements are being signed by countries around the world, thereby opening up new markets and expanding the world economy. Interestingly enough, statistics show that there is a distinct advantage to countries that are the first to sign agreements. Presumably, it is because significant market share for products is won by entering countries and held, even as new competition enters at a later time. This fact alone should present urgency to the United States Congress. It is expected that the European Union will have completed an FTA with Korea by the end of November.
President Obama has charged the International Trade Administration with the task of doubling U.S. exports in five years. It will take bold steps, such as the passage of this and other FTAs to reach this goal. So what is the stopping our Congress from moving ahead? Currently, there are two main sticking points which the Ambassador addressed in his talk last week. There is a general perception of protectionism by Korea against the United States in the automotive and agricultural sectors (specifically beef). The Ambassador outlined the FTA in its current form and demonstrated how these industries would benefit from the agreement.
As the U.S. economy recovers, it will be a swift and aggressive approach to trade which will enable the country to secure its economic future. The U.S.-Korea FTA is just one example of an opportunity for mutual economic benefit, enhanced partnership and security, and job creation which must be answered by Congress. Timing of this agreement couldn’t be more critical to giving United States manufacturers a leg up on global competition in Korea.