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U.S. trade official supports free-trade pact with South KoreaWASHINGTON (AP)--A top Bush administration trade official defended a free-trade pact between the United States and South Korea as good for U.S. automakers and other companies in the face of keen skepticism in Congress. "This is the strongest automotive package that has existed in any free trade agreement," Karan Bhatia, deputy U.S. Trade Representative, told reporters in early April. The deal reached earlier this week requires approval by the Democratic-controlled Congress as well as lawmakers in South Korea. The agreement would eliminate and lower tariffs and other trade barriers in a wide range of industrial goods and services, including automobiles, agricultural products and financial services. On Capitol Hill, however, the deal drew opposition from Rep. Sander Levin, a Michigan Democrat, for not going far enough to help U.S. automakers gain broader access to the South Korean market. South Korea currently sells more than 700,000 vehicles a year in the United States, while U.S. makers sell about 5,000 in South Korea. Both sides agreed to cut and phase out tariffs on automobiles, and South Korea also agreed to change its tax system for larger vehicles, which the U.S. contended was discriminatory. The auto provisions, Bhatia said, are a "huge step forward" for U.S. automakers. "The question becomes, 'Are you better off with it or without it for the automotive sector,' and I would suggest that they very much would be better off with the agreement," he said. But Levin said April 2 that the "U.S. did not get what was needed--an agreement that assures that the U.S. automotive industry will no longer face the barriers to their products, that trade will be truly a two-way street." Some lawmakers, including Max Baucus, are upset that South Korea still has restrictions on U.S. beef that were imposed after the Bovine Spongiform Encephalopathy scare several years ago. Bhatia, who led the U.S. negotiating team on the deal, expressed hope that South Korea's government will reopen its market to U.S. beef when new international provisions on BSE are issued in May. Other lawmakers are disappointed the trade agreement didn't open an avenue for U.S. rice exports. Trade protections for South Korean rice farmers still stand under the deal. Bhatia said the administration will work to brief lawmakers on the trade pact, and was hopeful this process will ultimately win over more supporters. "We think this is a very strong agreement and one that deserves to be approved by the Congress," he said. If that happens, it could energize other trade efforts in Asia. There's a possibility it could be a "stepping stone to a wave of liberalization in East Asia," Bhatia said. Date: 5/3/07
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