“The stakes are high and time is running out,” was one of the messages that South Korea’s Ambassador Han Duck-soo told a group of pork producers and industry representatives at World Pork Expo on Thursday, regarding the U.S./South Korea Free-trade Agreement.
The FTA, also known as KORUS, was originally drawn up in June 2007, but it is still awaiting final approval from the U.S. Congress. South Korea’s National Assembly has 299 members, of which 171 “strongly support the FTA,” Han pointed out. “My president is very strongly committed, and we would like to get it completed.”
The Obama Administration supports trade and has pressured Congress to pass KORUS and other FTAs, however, some issues regarding labor and worker retraining have stalled some of that pressure. U.S. pork producers and allied industry, other agricultural groups, the U.S. Chamber of Commerce and a variety of industries all support the FTA’s passage.
Negotiations in December resolved some issues surrounding vehicle trade between the two countries. At the time, U.S. pork producers agreed to some concessions, which included a delay in lifting some tariffs on pork products. “You took one for the team,” Han told the group. “The U.S. pork industry understands that trade is key to economic growth and prosperity.”
“We are delivering our concerns to Congress,” Han said, in regard to getting the final approval. “We do not know when, how or under what circumstances KORUS will become final.” But he, and certainly pork producers, are hoping that time will come before Congress’ August recess. If the decision is delayed beyond that, Congress is likely to become mired in other monumental issues this fall, like the federal budget and then soon thereafter the 2012 elections.
Delaying the FTA’s approval will prove to be costly for the United States in general and the U.S. pork industry in particular. “U.S. pork could be phased out of the South Korean market by 2016,” Han noted. Chile is one country making tremendous strides in Korea; the European Union’s FTA begins July 1; and negotiations are underway with both Canada and Australia. “Both of those can be signed later this year,” Han said. “They are coming quickly.”
That’s because there is great potential in that market for many goods, but definitely for pork. There are 48 million consumers in the country, with growing incomes, who like pork, so “the need is growing,” Han said. “We cannot produce enough of many food products.”
South Korea has a $1 trillion annual economy, the 15th largest in the world. Its land mass is 60,000 square miles—about the size of Georgia—but it is mostly mountainous.
“American farmers and ranchers are well equipped to help meet our needs, but they need this FTA,” Han said. The United States has been a big supplier this year in response to South Korea’s reduced pork and beef supplies due to a foot-and-mouth disease outbreak. For the first quarter of this year, U.S. pork exports to Korea were higher than for all of 2010.
He cited Iowa State University Economist Dermot Hayes’ estimates that KORUS would add 29,000 U.S. jobs, 3,600 specific to the pork industry, and $10 per head to live hog prices. .
“The FTA is not about the governments; it’s about you, it’s about farmers, ranchers, businesses, manufacturers, farmers and workers to compete on a level playing field,” Han said. “What happens will affect you for a long time, it will affect Korea for a long time. It is critical that pork producers sustain their voices of support for KORUS.”