South Koreans Rally Against Free Trade Pact With U.S.
By CHOE SANG-HUN International Herald Tribune
Published: July 12, 2006
SEOUL, July 12 — Tens of thousands of demonstrators marched through the rain-drenched center of the South Korean capital today, protesting a proposed free trade agreement between the United States and South Korea that negotiators are working on this week in a Seoul hotel.
A crowd estimated at 30,000 by police and 70,000 by organizers chanted “No to F.T.A.! No to economic subjugation!”
Protestors clashed with police when they tried to topple a barricade of buses blocking the march’s route to the Blue House, the president’s official residence. On the city’s main thoroughfare, the protestors, many of whom were farmers, threw garbage and wielded long bamboo sticks at the 24,000 police officers deployed in the city to keep order. The police fought back with water cannons.
“Those against an F.T.A. with the United States are highly organized, persistent and passionate with their messages, while the government’s arguments for the deal sound unconvincing to people,” said Young Soo Gil, president of the National Strategy Institute in Seoul. “There is a lot of uncertainty and concern about the prospects of the talks.”
Alexander Vershbow, the American ambassador to South Korea, called the trade talks a “vote of confidence” in the Washington-Seoul alliance.
For the United States, a trade pact with South Korea would be the most ambitious since the North American Free Trade Agreement in 1994, and its first with a nation in northeast Asia. Studies sponsored by the government suggest that a deal would increase American exports to South Korea by $19 billion a year, and South Korean sales in the American market by $10 billion.
“The United States feels increasingly disengaged from an economic integration in East Asia,” Mr. Young said. “An F.T.A. with South Korea can work as a Trojan horse that will help the United States protect its influence in the region. An F.T.A. can be a way for both South Korea and the United States to overcome and benefit from the challenge of China’s fast-growing economy.”
That may have been President Roh Moo Hyun’s intention when he declared in February, to much consternation among critics and supporters alike, that he wanted a free trade agreement with the United States.
For Mr. Roh, it is a political gamble. Students, farmers, fishermen and labor unions oppose the trade deal because they fear lower produce prices and loss of jobs in protected industries when trade barriers are removed. These groups have set the political agenda in South Korea in recent years, electing Mr. Roh, opposing globalization, demanding more equitable distribution of wealth and calling for the country to distance itself from the United States.
Their literature, ubiquitous on the Internet and in leaflets on the streets, now call Mr. Roh and his free-trade advisers “pro-American quislings,” intent on turning South Korea into an “American colony.”
The South Korean economy’s growth, which averaged a torrid 8 percent a year in the 1970’s and 1980’s, has slowed in recent years, and its share of the market for imported goods in the United States has slipped to 2.6 percent this year from 3.3 percent a decade ago.
Challenges like steep competition from China, a rapidly declining birth rate and an aging population all loom, and economists say the country must restructure its economy to keep growing for the long term.
Officials believe a free trade agreement could provide a catalyst. A study by the Korea Institute for International Economic Policy predicts that it would accelerate economic growth, expand South Korean exports to the United States by 15 percent and create as many as 550,000 new jobs in manufacturing and services.
Greater American investment in South Korean industries could also help the country better tap the exploding Chinese market, the report said, while South Korean consumers would benefit from access to cheaper farm produce and more choice in consumer goods, and South Korean businesses would be prompted by American competition to become more efficient and better managed.
The United States is South Korea’s second-largest trading partner, after China, and South Korea generally levies higher tariffs on imported American goods — as high as 40 percent on beef and cigarettes, for example — than the United States assesses on South Korean goods. Only 4,000 American cars were sold in South Korea last year, while 800,000 Korean cars were sold in the United States, contributing to South Korea’s $14 billion trade surplus, out of total bilateral trade of $72 billion.
Critics say those figures show that the country has much more to lose and much less to gain from free trade than America does.
Still, Wendy Cutler, the assistant United States Trade Reprsentative, said on Monday that she remained “ optimistic about our prospects for success” on a trade pact. “We shouldn’t let these concerns and anxieties expressed by certain groups deter our work or derail our efforts,” she said.
Ms. Cutler is pressing for increased access to South Korea’s agriculture, automobile, pharmaceutical and insurance markets, among others. Even before the talks began, the United States obtained some relief on trade barriers to Hollywood movies and American beef. But the decisions provoked almost daily protests.
”The Korea-U.S. F.T.A. will make all South Korean people live in a U.S. economic colony, dispatching us on the path of a dark and uncertain future,” said Moon Kyung Sik, chairman of the National Farmers Confederation, as he addressed a rally.
The negotiators are racing against time, because President George W. Bush’s trade promotion authority, permitting a pact to move through Congress in a “fast track” procedure that bars any amendments, expires in June 2007. But there is growing skepticism whether a quick deal is possible.
There was no sign today that the two sides were narrowing their differences on such contentious issues as pharmaceuticals, rice and the status of goods produced by South Korean companies at an industrial park in the North Korean border city of Gaeseong.
Seoul wants goods made at Gaeseong to be treated as South Korean-made under the pact, but United States officials are reluctant, saying that the industrial park mainly benefits North Korea’s communist regime.