Written from South Korea
The Korea free trade agreement is something that is good for both the United States and Korea. For South Korea, this is an opportunity to solidify their position as a world economic power by establishing a relationship with the United States. They are in a situation where they are surrounded by China, North Korea and Japan. They are a group of 50 million people who since the Korean War have gone from absolute devastation to a solid economic performer -- a country that can deal with the United States on an equal basis.
When we began trading with an impoverished South Korea, we opened our doors and lowered our tariffs to the point where they paid almost nothing to export to the United States. Simultaneously, we are still paying enormous tariffs when we export to South Korea.
I'll give you an example: a bottle of wine that would cost $13 in Seattle would cost $68 here in Seoul because of the tariffs. With the new trade agreement, those tariffs will come down and we will have Washington State wine sold here in Korea. Instead of drinking French, Italian, Spanish and Argentinean wines, they will be drinking Washington wine. That's just one example of how we stand to benefit from an economic standpoint.
The other side of it is the emotional side. Koreans feel a great gratitude toward the United States because of the Korean War, and they want to be in a permanent, special relationship with us. They want to be our partners, and they have demonstrated over and over in the diplomatic world that they support the United States. To deny them this is to say all that other stuff doesn't mean anything -- it would be us saying you can go to the European Union and trade with them exclusively.
On Friday, South Korea is slated to sign a free-trade agreement with the EU that will begin on July 1. New long-term contracts will start to be signed by Korean companies with EU companies if they have no alternative and competition from the United States because we passed on a Korean free trade agreement. Korea is moving forward, but they want to be our partner, and they have done everything to earn it. They renegotiated the trade agreement and did so in spite of political opposition in their country. They have excellent labor and environmental standards. They have done everything one could expect.
On our side, it is important we begin to establish trade agreements with other countries in the Pacific Region to allow states like Washington to create export-related jobs.
Congressman Jim McDermott represents the city of Seattle, WA in the U.S. House of Representatives where he is the Ranking Member of the Subcommittee on Trade.
Originally posted on the US Department of Commerce blog.