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S. Korea not to discuss beef but to focus on auto trade; Minister Kim

Yonhap News, Korea

S. Korea not to discuss beef but to focus on auto trade; Minister Kim

29 November 2010

By Hwang Doo-hyong

WASHINGTON, Nov. 29 (Yonhap) — South Korea will focus on autos and is not ready to discuss beef during the upcoming talks with the United States for the ratification of a pending free trade deal, the chief South Korean trade negotiator said Monday.

"Beef is not the subject of discussions," South Korean Trade Minister Kim Jong-hoon told reporters upon arriving at the Dulles International Airport. "Discussions will focus on auto trade."

Kim heads a 10-member South Korean delegation to the two-day talks with U.S. Trade Representative Ron Kirk and other officials beginning Tuesday at the Sheraton Columbia Town Center Hotel in Maryland.

Kim and Kirk failed to strike a deal early this month when they met in Seoul on the sidelines of the G-20 economic summit in their last-minute efforts to meet a deadline set by South Korean President Lee Myung-bak and U.S. President Barack Obama.

Obama had said he wanted to make a deal before the G-20 summit and present a deal to Congress early next year.

The Korea FTA has been on hold for more than three years over U.S. demands for wider access to the Korean auto and beef markets.

Obama said in Seoul that auto trade poses a bigger obstacle than beef and pledged to complete the talks "within weeks, not months."
Seoul officials have said they will consider easing safety and environmental standards, while the U.S. has called for a delay in the elimination of the 2.5 percent tariff on most autos and auto parts and a phase-out of the 25 percent tariff on light trucks.

Kim said that he is not ready to discuss any other issues than autos.

He said he is optimistic that he can strike a deal during the two-day discussions.

"Two days are long enough," he said. "I would not have come here to the United States if I did intend (to conclude the talks)."
The chief South Korean negotiator added, "The sides should have thought a lot, as we’ve been subjected to a lot of controversy and criticism after we failed to reach an agreement. I think we can come up with a mutually acceptable solution."
South Korea stands firm in its position not to discuss the U.S. demand for shipments of beef from cattle older than 30 months. Weeks of street rallies followed South Korea’s decision in early 2008 to resume U.S. beef imports despite fears of mad cow disease, which appears more often in older cattle.

Seoul suspended shipments of U.S. beef in 2003 after cases of bovine spongiform encephalopathy surfaced in the U.S.

The U.S. beef industry recognizes the sensitivity of the issue and does not want to jeopardize the rapid increase in beef exports since 2008.

Last year, the U.S. exported 5,878 automobiles to South Korea, while South Korean auto shipments to the U.S. totaled 476,833, according to figures from the United Auto Workers union.

The Korea FTA is seen as a barometer for Obama’s commitment to free trade as he has set the ambitious goal of doubling exports within five years as a means of creating jobs.

Many congressional Democrats oppose the trade deal for fear of possible job cuts amid the worst recession in decades, but free trade is seen as one of the potential areas of close cooperation between Obama and congressional Republicans, who regained control of the House in the midterm elections.

A failure by Obama to present the deal to Congress early next year will likely doom it, as Republicans have vowed to focus on domestic issues, including taxes and a reversal of Obama’s health care reform policy, ahead of the presidential election in 2012.

Independent studies show that the FTA with South Korea will create 240,000 jobs in the U.S. and increase annual two-way trade by more than $20 billion, up from $83 billion.

The U.S. goods trade deficit with South Korea was $10.6 billion in 2009, down $2.8 billion from 2008, according to United States Trade Representative figures. The comparable figure for the first six months of this year was $421 million on $55 billion in total trade volume.

During the same period, the U.S. deficit with China was $115 billion and that with Japan and Germany $18 billion each, according to South Korean government figures.