S.Korea and China resume preliminary FTA talks
The Hankyoreh, Seoul
S.Korea and China resume preliminary FTA talks
The secret talks have raised concerns for the agricultural industry, which stands to incur billions in losses per year
By Jung Eun-joo
9 July 2011
The South Korean and Chinese governments recently resumed preliminary ministerial discussions on sensitive areas prior to beginning discussions on a free trade agreement (FTA).
In a press release Friday, the Ministry of Foreign Affairs and Trade (MOFAT) reported that Lee Tae-ho, director of the Foreign Ministry’s FTA Policy Bureau, paid an unofficial visit to China that day for ministerial-level discussions on the handling of sensitive areas in connection with the South Korea-China FTA.
“While both countries agree on the need for an FTA, differences of opinion do exist on the timing and method for initiating discussions,” MOFAT said.
While the government claimed this was an unofficial visit, observers are speculating that the statement was released belatedly for clarification after its attempts to carry out secret discussions came to light.
Following the conclusion of joint industry-academia-government research in May 2010, the two countries held a first round of preliminary government discussions on the handling of sensitive areas in Beijing the following September. But the second round of discussions, scheduled to take place in Seoul in November and December of last year, failed to take place due to the G-20 Summit in Seoul and the artillery attack on Yeonpyeong Island. The push was renewed at the May summit meeting between President Lee Myung-bak and Chinese Prime Minister Wen Jiabao, where both leaders agreed on the need to move forward toward the initiation of FTA discussions in the near future.
Trade authorities from both countries subsequently held secret preliminary discussions, while experts from state think tanks have been participating on a team for working-level FTA countermeasures. The team, which includes specialists from the Korea Institute for International Economic Policy (KIEP), Korea Rural Economic Institute (KREI), and Korea Institute for Industrial Economics and Trade (KIET), is divided into product and regulation sections and is carrying out analysis of concrete effects. The analyses are known to be in their final stages.
Government-affiliated research institutes have also been working to create a favorable atmosphere, with a number of policy seminars held on the South Korea-China agreement. A government official said, “Due to a Foreign Ministry request for confidentiality, I cannot give specifics, but discussions on the South Korea-China FTA appears set to begin right away.”
The problem most discussed at the moment is that the establishment of countermeasures against possible negative effects has confounded the government’s complete secrecy. This includes not only on the specifics of the discussions but even their starting date, despite the enormous impact they will have on the South Korean economy.
It goes without saying that interested parties that will suffer major losses if an FTA is signed, including farmers and small businesses, have not been given the opportunity to air their views. A 2009 KREI analysis predicted that production in the agricultural sector would drop by 2.4 trillion won ($2.2 billion) per year once a South Korea-China FTA goes into effect. In 2004, the KIEP predicted an estimated $11.7 billion (approximately 13 trillion won) per year in increased imports of agricultural products from China.
