FTA with the US
Our world is not for sale
FTA with the U.S.
Korean People’s Action against FTAs & WTO (KoPA)
4/5/2006
Out of the blue, FTA is suddenly on our face. One day the news of the treaty covers the front page of most media. The U.S. demanded the Korean agriculture market to be opened with no exception. They also called for scaling down the screen quarter in half. Korean people are flabbergasted with the pouring news. Let’s look into what is unfolding.
The Korean government argues that it has prepared for FTA with the U.S. since 08/2003. And Korean government has actively asked for the treaty to be settled. The argument, however, is simply not true. The U.S. TPA (Trade Practices Act) dies out on 30/06/2007. And the "negotiation" between Korea and the U.S. is set to go on from 04/05/2006 to 03/2007. What it suggests is that the "negotiation" was demanded by the U.S. government!
FTA with Chile, a much smaller country, took 3 years to settle. The deal with the U.S. will only take 11 month. The Korean government, furthermore, did not asked for any feedback from the Korean people. It did offer a public hearing to express other opinions just the day before the "negotiation", only for 20 minutes! The U.S. government, on the other hand, spends 90 days for the same process.
The government insists that globalization and the open door policy is the only way to become a "developed country". And the FTA with the U.S., in the process, is a definite ’must’. The problem that arises from such approach is that the Korean government has to justify the deal with the U.S.
The government claims that the deal is good for Korea presenting various creamy numbers. The numbers look, however, very suspicious. According to a report (11/2004) by FKI (The Federation of Korean Industries), the association of the biggest Korean conglomerates, shows that the industrial production will fall by 27.37% while the social welfare will rise by 4.7%. Another report by the American chamber of commerce in Korea (2005) reveals that the import from the U.S. will rise by 43%- 54% per year while export to the U.S. will show 21%-23 increase.
The agriculture and livestock industry will suffer the most, about $2 billion in deficit per year. Even the Korean government acknowledges the damage though it shrinks down the number to $50 million loss.
According to the USITC (United States International Trade Commission) report (2001), the trade balance, in just four years, will go down from $98million to $9million profit. And, in another 4-5 years, if the flow continues, the balance of trade will reach staggering $100 million in deficit. The government’s claims, thus, are falsified.
The upcoming problem of FTA with the U.S. does not stop there. Of all aspects of the pact for Korea, competitive products come from some electronics/digital, automobile and textile industries. And the culture industry, including movie, music, education and related industries, money market, and the service sectors, concerning legal and medical services, will all be devastated since these industries are far behind in means and techniques when compared to the American counter parts.
As of now, 90% of the workforce is hired by small and medium businesses. FTA with the U.S. will mean a disaster to the workforce. What they will face is less job opportunities and the rigidity of the labor market, due to fewer competition. The economic growth without further employment will facilitate the fragmentation of Korean society by various criteria, including income, education and status.
The foreseeable future presents, thus, a gloomy picture of Korea as a whole. Feeble job security, widening schism between the rich and the poor, the following social instability and, as a result, an extreme social discord are not hard to anticipate. If this hideous contract bears fruits, the fruits will be of terrible taste.
For more information email National Association of Professors for Democratic Society at mingyo@chol.com.
