Negotiations on the Korea-U.S. Free Trade Agreement (KORUS-FTA) began in 2005 and the agreement was completed minutes prior to the expiration of Trade Promotion Authority (TPA) under President Bush in 2007. The Obama administration won significant revisions that addressed potential weaknesses in the agreement in December of 2010, but it—and other FTAs with Panama and Columbia—still have not been formally submitted to Congress for ratification. The reasons for the protracted delays are well articulated in the findings of CFR’s Independent Task Force on Trade and Investment Policy released earlier this week. Namely, in the absence of the sort of coherent and bipartisan approach to trade policy that the report elaborates, Congressional consideration of the Korea-U.S. FTA has suffered from unconscionable delays.
South Korea has shown unusual patience in pursuit of U.S. ratification of the deal. South Korea’s President Lee Myung-Bak has consistently pushed the KORUS-FTA since his first meeting with President Obama in 2009, only to find the United States preoccupied with issues from health care to the debt ceiling. Meanwhile, the Korea-EU FTA, which was originally negotiated with the Korea-U.S. FTA as a template, entered into force on July 1 of this year. Thus, EU firms are enjoying tariff advantages in the Korean market unavailable to U.S. firms in the absence of KORUS ratification. Although South Korea’s ruling party controls the National Assembly, the delays carry potential political risks for South Korean legislative ratification (to be taken up following U.S. Congressional ratification) as the National Assembly comes closer to legislative elections in April of 2012.