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Korea¡¯s conclusion of a free trade agreement with the U.S. on Monday drew mixed reactions from its big competitors in Asia, while the U.S. government and business circles welcomed the news. The Japanese press said Korea distinguished itself as a trade hub from China and Japan with the FTA, while Chinese experts predicted more Chinese investment in Korea.
¡ß United States
In a letter notifying the U.S. Congress of the FTA, President George W. Bush said, "The U.S.-South Korea free trade agreement will generate export opportunities for US farmers, ranchers, manufacturers and service suppliers, promote economic growth and the creation of better paying jobs in the U.S." He pledged to cooperate with Congress, which is controlled by the Democrats, to see the trade deal ratified. American exporters also welcomed the news. The National Association of Manufacturers (NAM) and the Coalition of Service Industries (CSI), the oldest business lobby groups in the U.S., urged Congress to ratify the FTA as soon as possible. The NAM said the FTA will further enhance U.S. competitiveness in Asia. The American Farm Bureau Federation also welcomed it, recalling that the share of American agricultural produce in the Korean market dropped to 30 percent in 2004, from 45 percent in 1996, due to China and Australia. The FTA offers an opportunity to rectify that, it added.
¡ß China
Chinese trade experts believe that China may see its exports to the U.S. decline in the short term but foresee no inevitable disadvantages in the long term. Wang Yong, the director of the Peking University Center for International Political Economy Research, said, "With the conclusion of the South Korean-U.S. FTA, China may see exports of machinery to the U.S. or exports of agricultural produce to South Korea decline. But from the Chinese standpoint, this will offer Chinese enterprises an opportunity to make efforts to enhance their corporate competitiveness." Economist Su Dongpo said, "It seems the U.S. made many concessions to Korea in the negotiations in an effort to curb China's rapid growth by using South Korea." Chinese experts predict the deal will also spur Korea-China FTA talks, which are in their initial stage.
¡ß Japan
Japan¡¯s Nihon Keizai Shimbun said South Korea, which worries about being ¡°squeezed¡± between Japan and China, is affirming its presence as a ¡°hub¡± with the FTA. The newspaper said the FTA puts Japan at risk of lagging behind South Korea in the market for some products, including cars and components. It criticized the Japanese government for failing to keep pace with the global trend of trade liberalization due to its tariffs on agriculture and fisheries products.
The Kyodo news agency said South Korea concluded the FTA with the U.S. based on President Roh Moo-hyun's determination to get there before Japan and China. Jiji Press said that the bilateral FTA will likely make up for the politically shaky Korea-U.S. alliance in economic terms.
(englishnews@chosun.com )
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