BUSINESS

Seoul rejects Washington’s request to revise FTA

By Julie Jackson

Chief negotiator Kim Hyun-chong says Korea’s position made ‘very clear’

  • Published : Aug 22, 2017 - 18:44
  • Updated : Aug 23, 2017 - 13:04
Seoul and Washington were unable to reach a consensus regarding the United States’ request to amend certain terms of the two nations’ free trade agreement, the country’s newly elected chief trade negotiator Kim Hyun-chong said Tuesday.

Trade representatives from Seoul and Washington began their first round of negotiation talks on Tuesday morning during the joint committee special session on the Korea-US FTA, held at the Lotte Hotel in Seoul. 

Kim Hyun-chong, Korea’s chief trade negotiator, speaks to the press during a briefing held at Central Government Complex in Seoul on Tuesday. (Ministry of Trade, Industry and Energy)

“We were unable to reach any consensus,” said Kim, during a press briefing at the Central Government Complex in Seoul.

“The US cited that their trade deficit has doubled since the FTA came into effect and stated the current terms of the Korea-US FTA needed amending or modifying sometime in the near future,” Kim continued. “However, we stressed that the US-Korea goods and services deficit is not the result of the FTA … the meeting confirmed our different views on certain issues so we were unable to come to any agreements.”

Kim added that during the joint committee meeting, Seoul’s trade representatives presented their American counterparts with facts and figures regarding the mutual benefits of the FTA and made their stance clear that the Korean government remains adamant that the terms of the agreement remain unaltered.

No dates have been set for future scheduled talks, said Kim, adding that the Korean government intends to wait to hear from the US regarding Seoul’s suggestion to first thoroughly investigate, analyze and evaluate the effects of the trade agreement.

“We are not saying that we are better off not having the FTA agreement at all, I think both sides agree that the nations would be better off having a trade deal,” Kim said.

“At no point during the meeting was the term ‘termination’ used,” he stressed.

Prior to the start of the meeting Kim told reporters that he would be “negotiating with confidence.”

On Tuesday morning Kim and US Trade Representative Robert Lighthizer, who was unable to attend the meeting, first spoke via video conference, exchanging both parties’ positions regarding the current terms of the FTA.

“I made our position very clear,” Kim briefly said to reporters following his 30-minute videoconference with Lighthizer. “It is not easy to predict the first round of negotiations.”

Following the conclusion of the videoconference between the two trade chiefs, additional senior-level discussions were held between Korean and US officials. The session was attended by representatives of the Trade Ministry, as well as USTR Chief of Staff Jamieson Greer and Michael Beeman, assistant US trade representative for Japan, Korea and APEC.

Although trade representatives from Seoul and Washington have met every year since the establishment of the Korea-US FTA five years ago, Tuesday’s meeting came more than a month after the USTR sent Korea an official request to hold a joint session to discuss matters regarding the FTA, including opening dialogue for what Lighthizer referred to as “possible amendments and modifications” and to address the “significant trade imbalance.”

The first round of meetings has drawn wide speculation that Tuesday’s joint committee was the start of Korea and the US entering into an intense FTA showdown, given US President Donald Trump’s multiple public denouncements of the trade deal and vows to amend it.

However, during a meeting with the members of the Ministry of SMEs and Startups at the National Assembly on Tuesday, Trade Minister Kim reiterated that the special session does not represent the beginning of any FTA renegotiation procedures.

While President Trump blames the FTA for causing the US’ deepening $27.6 billion trade deficit, the Korean government continues to maintain its stance that the trade deal has mutually benefited both parties since its induction.

“I think it’s better that we maintain the agreement because it’s a win-win,” said Kim during his meeting with the Ministry of SMEs.

Tuesday’s joint committee meeting was the first test of aggressive negotiation tactics for newly appointed chief trade negotiator who took office on Aug. 4. Kim led the Korean side of the negotiations on the FTA nearly a decade ago.

While Tami Overby, senior vice president for Asia at the US Chamber of Commerce, and a strong supporter of the FTA, has referred to Kim as “one of the smartest trade negotiators alive,” the trade negotiator has drawn some criticism from the local business community for his alleged pro-business attitude and pro-US stance taken during initial FTA negotiations with the US.

In his inauguration speech earlier this month, Kim emphasized that he would take an aggressive stance, rather than a defensive approach, when it comes to all trade negotiations. 

By Julie Jackson (juliejackson@heraldcorp.com)