Macon.com | 24 Sep 2011
Kia closely watching free-trade debate
By HALIMAH ABDULLAH
WASHINGTON — Just a few short years ago, Korean automaker Kia’s decision to build a $1.2 billion manufacturing plant in West Point. — a small town north of Columbus near the Georgia-Alabama border — was received with such fanfare that local officials jokingly dubbed their hamlet “Kia-ville.”
So people in that part of the state and the lawmakers who represent them listened carefully when President Barack Obama, while unveiling his $447 billion jobs package, touched on stymied free-trade agreements and singled out Kia.
“If Americans can buy Kias and Hyundais, I want to see folks in South Korea driving Fords and Chevys and Chryslers,” Obama said during his speech earlier this month before a joint session of Congress.
The highly politicized push to get the president to send three long-delayed free trade agreements with Panama, Colombia and South Korea to Congress gained traction this week as Republicans and Democrats worked to negotiate the details of worker assistance programs and trade preferences.
The agreement with South Korea, which has been mired in partisan politics since Obama took office, could increase American exports to Korea by more than $10 billion a year, according to the U.S. International Trade Commission. The Congressional Research Service predicts that the South Korea agreement would create 280,000 American jobs.
The heightened tension over the trade agreements are because they are “one way potentially to stimulate the economy on which there will be strong Republican support and one that could have a significant impact on the economy,” Randall Strahan, a political science professor at Emory University, said.
Some Georgia Republican lawmakers reason that passing a free-trade agreement with South Korea will help companies like Kia expand, attract new business exchanges with Korea and, as a result, reduce the state’s unemployment rate.
Kia spent $150,000 in the first quarter of this year to lobby members of the U.S. House and Senate on matters that included the Korea-U.S. free-trade agreement, according to federal lobbying records.
Kia has taken a similar stance when pressing such lawmakers as Sen. Johnny Isakson, R-Ga., to advocate passing a free-trade agreement with South Korea, senate staffers said.
“There is one person in America who is stopping job creation by not letting these bills come to the floor of the House and Senate, and that is the president of the United States,” said Isakson, who serves on the Senate’s foreign relations committee, of the delay on the free-trade agreements. “It is my hope that the president will focus on creating real jobs now.”
Officials from Kia did not return requests for comment.
Labor unions, such as the Teamsters, worry that a free-trade agreement with South Korea would send American jobs with American benefits to countries with cheap labor, wobbly workers’ rights regulations and few benefits.
“What politicians are calling “free trade” is actually freedom for CEOs to trade our jobs for more big salaries and bonuses,” Teamsters president James Hoffa wrote in an op-ed published earlier this year in the Detroit News. “I’m concerned about the trade deal with South Korea because it’s likely to have an impact very similar to the (North American Free Trade Agreement). ... The two industries hurt most by NAFTA are computers and electronic parts, and motor vehicles and automotive parts.”
Southern states such as Georgia and neighboring Alabama have benefited from hosting foreign automakers, and automotive experts say the Deep South has experienced an economic rebirth, in part, through a symbiotic relationship with foreign automakers and domestic auto suppliers.
The trade agreement with South Korea has been of special interest to Georgia lawmakers ever since Kia decided to locate its first North American plant in the state.
Georgia Gov. Nathan Deal on Thursday announced that South Korea-based Mando Corporation plans to invest $200 million in opening a third U.S. manufacturing operation in the Meriwether County Industrial Park. The company plans to create 426 jobs, and the Georgia plant will supply electric power steering gears and anti-lock brakes to vehicles.
Korean-owned tire manufacturer Kumho put on hold its plans to invest a $165 million in building a 5.7 million square foot plant in Macon when the economy started to slow down, company officials said Wednesday.