National interests need to be top priority in Korea-EU FTA
The Hankyoreh, Seoul
Editorial: National interests need to be top priority in Korea-EU FTA
12 May 2007
Korea and the European Union have finished their first round of free trade talks. They have agreed to the basic principle of eliminating tariffs on 95 percent of all their products and on industrial products in ten years. We hope to see these negotiations be prudent and thoroughly about looking after Korea’s interest, which was not the case with FTA talks with the United States, which were forced through by a ticking clock set by the other side.
There is something positive about an agreement with the EU that would not be the case with the U.S. deal. The EU is a huge economic zone with which we trade US$78 billion a year, and we would also be able to diversify our trade partners, having long been overwhelmingly focused on the U.S. and China. Since the negotiations are not talking about sensitive issues like agriculture, audiovisual products, and procedures to resolve investor-state disputes, it looks like the shock of opening Korea’s markets per an EU FTA would be less severe.
That is not to say that negotiations with the EU should be taken lightly. The EU is no less competitive than the U.S. in terms of financial and communications services, as is the case with foods like wine, cheese, and water. Furthermore, it has a lot of the automobiles, cosmetics, and fashion brands Koreans love, so high-priced imports could rush in like water from a broken dam. Much about an agreement with the EU will require major changes in the way Korea does things, including stronger copyright protections, the elimination of some "special income" taxes, the privatization of the parcel delivery market, and removal of technology barriers.
There has yet to be any objective assessment of what the effects of a free trade agreement with the EU would be. The country should not pursue an agreement based entirely on the exaggerated findings of state-funded think tanks. An assessment of a deal’s potential effects has to start at square one if we are going to avoid a repeat of the hastily arranged negotiations with the U.S. We need to avoid negotiations that are determined to see an agreement no matter what the conditions. Korea needs to negotiate with nothing but real, practical interest in mind and with the attitude that we are going to take the lead in the process.
The government is already in simultaneous negotiations on a free trade pact with Canada, and is pursuing the idea of similar agreements with India and China. It would be dangerous for it to begin to think it should conclude an agreement with the EU so that it can move on to other countries. It could lead to the same kind of hasty negotiations that took place with the U.S. Each and every issue must be afforded ample debate with experts so that we are sure of what interests are at stake. The government pushed ahead with the negotiations with the U.S. without ever holding a formal public hearing, and neither the people nor the National Assembly knew what was going on. Things must be different this time. Instead of saying "opening markets is always a good thing," the government needs to give the country a detailed "financial statement" that it can understand.
