Posted August. 17, 2017 07:36,
Updated August. 17, 2017 08:04
Tami Overby, the senior vice president for Asia at the U.S. Chamber of Commerce, said in an interview with the Yonhap News Agency that U.S. businesses do not support the proposed renegotiation of the South Korea-U.S. free trade agreement (FTA). As U.S. businesses believe the bilateral trade pact is “working well,” the planned renegotiation should not ruin the agreement. The U.S. Chamber of Commerce is a lobby group representing some 3 million U.S. businesses. Overby is former president of the American Chamber of Commerce in Korea (AMCHAM). Her support for the Korea-U.S. FTA ahead of the South Korea-U.S. FTA Special Joint Committee meeting has fueled hopes for positive impacts on the renegotiations.
Overby’s remarks suggest that despite U.S. President Donald Trump’s view of the bilateral free trade pact as a “horrible deal,” U.S. entrepreneurs who have been influenced directly by the agreement have positive views about the deal. For the first five years since the agreement’s effectuation, the global trade decreased by an annual average of 2.0 percent, while the Korea-U.S. trade increased 1.7 percent. U.S. corporations’ share of the Korean market rose from 8.5 percent before the agreement to 10.6 percent, while South Korea’s investment in the U.S. increased by more than 60 percent from before the deal, having created 17,000 jobs in the U.S. More than anything else, U.S. trade deficit with South Korea, about which Trump complained, was attributed to American consumers’ active consumption of South Korean goods while South Korean consumers reduced their consumption amid an economic depression. It is not because the FTA was unfair.
It is welcome news that the U.S. business community knows the truth about the Seoul-Washington FTA. However, it is hard to expect that the Americans to make concessions of their interest at the negotiating table. Overby’s emphasis on regulatory consistency and an environment for fair competition suggests that U.S. businesses expect to have greater interest through a revision of the bilateral deal. With the start of the renegotiation for the North American Free Trade Agreement between the U.S. and Mexico held in Washington this week, a U.S.-initiated trade war is getting into a full swing. The renegotiating table for the Korea-U.S. FTA will likely be a battlefield for protecting national interest between the two allies. While acknowledging the U.S. business community as a partner for the Korea-U.S. FTA, Seoul should make its voices heard about ways to address its deficits in the services trade.