R.O.K-U.S Free Trade Agree-ment

November 22nd, 2011The Ratification of R.O.K-U.S FTA

• The National Assembly session held by a sur-prise.

• Out of 295, only 170 present.• Avoiding a physical attempt to block the bill.• Strong protest expected in future

Tear Gas Canister

What is FTA?

Tariffs

Expected Effects• 0.42~1.99% rise (2.9 ~ 13.5 billion USD) in

Korean GDP• 2.4 billion~6.8 billion USD benefit for Korean

consumers• 12.1~15.1% rise (5.4 ~ 7.1 billion USD) in

Korean exports to the U.S• 29.1~39.4% rise (9.6 ~ 12.2 billion USD) in

Korean import from the U.S• Approximately 104,000 new jobs in Korea

- Korean Institute for International Economic Policy

Timeline• February 2nd 2006: Announcement of

Negotiations• April 1st 2007: Conclusion of Negotia-

tions• June 30th 2007: Signing of the Treaty• December 2010: Signing of the Rene-

gotiated Version of the Treaty• October 12th 2011: Ratification by the

U.S Congress• November 22nd 2011: Ratification by

the R.O.K National Assembly

OppositionOpposition in Korea• Investor-State Dispute System• Negative effects on Korean Agriculture• Not very advantageous for Korea- Currently, only 2.5% tariff for cars, no tariff for

cell phones and semi conductors.Opposition in the U.S• Negative effects on the U.S car industry• Insufficient opening of the Korean agricultural

market- Rice market remains closed, too long time period

for opening the markets for other grains and meat

Why Should We Care?• Influence on our daily lives

Why Should We Care?Facilitation of R.O.K-U.S Trade

Why Should We Care?

Korean exports Korean imports

Why Should We Care?

Power Dynamics in East Asia• Influences on FTA between East Asian

countries- Korea-Japan, Korea-China, Japan-China,

etc • Greater R.O.K-U.S Trade= Less Korean Dependency on China= Greater U.S presence in East Asia= More intense competition for American

market between Korea and Japan (Cars, Electronics, etc) since Korean products would soon have more competitive price.

Works Cited

• Office of the United States Trade Representativehttp://www.ustr.gov/uskoreaFTA

• R.O.K Ministry of Foreign Affairs and Tradehttp://www.mofat.go.kr/main/index.jsp

• FTA webpage by R.O.K Ministry of Foreign Affairs and Tradehttp://www.mofat.go.kr/main/index.jsp

• Korea Herald News Articlehttp://www.koreaherald.com/national/Detail.jsp?newsMLId=20111122000941

• Wikipedia Article on R.O.K-U.S FTAhttp://en.wikipedia.org/wiki/Free_trade