Sandler, Travis & Rosenberg Trade Report | Thursday, July 27, 2017
Following a request from the U.S. to quickly launch talks on possible changes to their bilateral free trade agreement, Korea has made clear it wants to take a more measured approach.
In a July 12 letter, U.S. Trade Representative Robert Lighthizer requested the first-ever special session of the joint committee provided for under KORUS to consider “possible amendments and modifications” to the agreement. Lighthizer said this session and follow-on negotiations would provide an opportunity to review progress on the implementation of the FTA and resolve “several problems regarding market access in Korea for U.S. exports.” He highlighted the fact that the U.S. trade deficit with Korea has worsened under the FTA and said the U.S. would be looking for “a truly fair and level playing field and a more balanced trade relationship.”
In a July 24 response, new Minister of Trade, Industry, and Energy Ungyu Paik said the Korean government is “willing to engage in constructive discussions on ways to foster an expanded and balanced bilateral economic and trade relationship.” However, he also indicated that Seoul does not see a need for substantial revisions, pointing out that the FTA reflects a balance of interests and has generated mutually beneficial outcomes in terms of trade, investment, and employment. Paik therefore recommended that before discussing possible changes to the FTA the joint committee should first address “how best to work together to objectively examine, analyze, and assess the effects” of the agreement since its entry into force.
Although the joint committee meeting is supposed to take place within 30 days of the U.S. request, Paik asked for a delay until the Korean government completes a restructuring that includes the establishment of a Trade Office within the Ministry of Trade, Industry, and Energy and the appointment of a new trade minister. He also proposed that the meeting be held in Seoul and that government officials consult on other details, including the date and agenda of the meeting.