Even though originally signed by the two countries in 2007, the free-trade agreement between the United States and Korea, or KORUS, still has not been implemented. Despite the Obama Administration objective to increase U.S. exports it seems many in Congress are content to keep stalling approval.
If approved, KORUS would be the most commercially significant FTA the United States has negotiated in 16 years, according to the Office of the U.S. Trade Representative. Similar trade agreements with Colombia and Panama also are awaiting approval and also being ignored by Congress. Korea, however, is the world’s 15th largest economy, and holds by far the biggest trade potential.
KORUS is all about reducing and eventually eliminating tariffs. The U.S. International Trade Commission estimates that the reduction of Korean tariffs made possible by KORUS would add $10 billion to $12 billion to annual U.S. gross domestic product and around $10 billion to annual U.S. exports to Korea. Still, Congress does nothing.
The delay in enacting the FTA’s has led U.S. agriculture leaders to new heights of frustration. “USDA estimates that these three markets would mean $2.5 billion in additional agricultural exports,” said Bob Stallman, American Farm Bureau Federation president.
Congress’ failure to follow through on these trade agreements is beyond comprehension. “I don’t know why they (Congress) haven’t passed these FTAs,” said Steve Foglesong, president of the National Cattlemen’s Beef Association. “We all know they’ve been busy with some other things, but Congress needs to get off their duff and pass these FTAs.”
Meanwhile, Korea is not standing idly by while the U.S. Congress hems and haws, and delays action. While the United States delays implementation of KORUS, Korea continues to move forward in developing trade relations with Chile, Canada and European Union countries, among others.
In the case of U.S. pork exports to Korea, time is running out. “We recently signed a free-trade agreement with Chile which has dramatically increased our pork imports from that country,” said Jong hyun Choi, minister for economic affairs at the South Korean Embassy in Washington, D.C. Minister Choi highlighted the importance and urgency of the pending free trade agreement between Korea and the United States at a press briefing last week at World Pork Expo in Des Moines, Iowa.
Current or potential agreements with Korea’s other trading partners could result in closing the door to certain U.S. exports completely. The inaction of Congress may eventually result in elimination of the United States from the Korean list of trade partners in certain categories. How’s that for support from Congress?
While increasing exports is a crucially important objective of the FTA’s it’s not the only U.S. benefit. “Implementing the KORUS free-trade agreement could strengthen the alliance between our countries,” adds Choi.
What better time and what better way to show the bellicose North Korean regime where regional U.S. interests and allegiance lie? Immediate implementation of KORUS would send a strong strategic message to South Korea’s long-time nemesis on their country’s northern border.
With President Obama’s national goal of doubling U.S. exports over the next five years and the added jobs that result, it seems implementation of KORUS should be a snap. Concerns about implementing KORUS, however, have been expressed by some U.S. automakers and have led to Congress’ paralysis on implementation of the trade agreement.
Placing the interests of failing or bailed-out U.S. automakers above those of a vital, world-leading U.S. agriculture industry is just plain wrong-headed. Congress can right this situation by approving these free-trade agreements as soon as possible, but time is running out.
If the U.S agriculture industry is not moving ahead on foreign trade, it is falling further and further behind.