Mon, Dec 06, 2010 - Page 1 News List

US, S Korea reach trade agreement

Reuters, WASHINGTON

US President Barack Obama, right, makes a statement regarding the South Korea-US Free Trade Agreement as US Trade Representative Ron Kirk looks on at the Eisenhower Executive Office Building in Washington on Saturday.

Photo: AFP

US President Barack Obama vowed on Saturday to work with Republicans and Democrats to pass a free-trade pact with South Korea that he said was a model for future agreements he would seek in Asia and around the world.

US and South Korean negotiators struck a deal on Friday on the long-delayed pact, which was signed in 2007, but had not been ratified for three years because of US auto and beef industry concerns.

The pact was an accomplishment for Obama, who faced an embarrassing setback when negotiators failed to settle their differences before he visited Seoul last month, but it was greeted less positively in South Korea.

“The agreement we’re announcing today includes several important improvements and achieves what I believe trade deals must do. It’s a win-win for both our countries,” Obama told reporters in Washington.

A day after the US Department of Labor reported US unemployment unexpectedly hit a seven-month high of 9.8 percent last month, Obama said the pact would boost annual exports of automobiles, agricultural products and other goods and services by US$11 billion and generate 70,000 additional jobs.

The revised deal keeps the 2.5 percent US tariff on South Korean cars until the fifth year of implementation, while South Korea will immediately halve its 8 percent tariff on US auto imports.

Obama said the agreement with South Korea showed the US was ready to finalize more trade pacts — business leaders wish two other long-delayed deals with Panama and Colombia, would also get through Congress.

“I’m especially pleased that this agreement includes groundbreaking protections for workers’ rights and for the environment. In this sense, it’s an example of the kind of fair trade agreement that I’ll continue to work for as president, in Asia and around the world,” Obama said.

He also said the agreement shows the strength of Washington’s alliance with Seoul. Tensions in the region ratcheted up last month after North Korea attacked the small southern island of Yeonpyeong, killing four people.

Business leaders and analysts said free trade could be one area of cooperation between Obama’s Democratic administration and Republicans in Congress, who won a majority in the House of Representatives in the Nov. 2 elections amid voter discontent over the sputtering economy and worries over the US deficit.

Obama said he looked forward to working with Congress and leaders of both parties to approve the pact. Both the US House and Senate must approve the agreement, and Senate Republican Leader Mitch McConnell said he was prepared to work with Obama to win approval.

A range of companies and industry groups have spoken out in support, including the United Auto Workers union and Ford Motor Co. House Majority Leader Steny Hoyer, a Maryland Democrat, also praised the deal.

Despite progress on the auto issues, Senate Finance Committee Chairman Max Baucus, a Democrat, said he was “deeply disappointed” the deal did not address South Korea’s remaining restriction on beef imports imposed in response to discovery of several cases of mad cow disease in the US cattle herds a number of years ago. Baucus, whose committee has jurisdiction over trade, said he would reserve judgment while continuing to work with the Obama administration.

Obama said the US would continue to press for “full access for US beef to the Korean market.”

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