Saturday, February 11, 2012
KORUS FTA--So What's the Delay?
By Don Southerton, BCW Editor
This past week we saw the current Korean administration's opposition seek to "axe" KORUS FTA. In response supporters are pressing to get the FTA enacted ASAP. As reported in Yonhap News Agency, “We believe that the U.S.-Korea free trade agreement is in the interest of the United States, of the Republic of Korea, and of the relationship between our two countries,” A State Department official further noted. “The U.S.-Korea free trade agreement represents a historic opportunity to increase exports, support job creation, bolster both our economies, and strengthen a vital strategic alliance in the Asia-Pacific.”
So what's the delay? Here's my update...
On a positive note following the 2011 amended agreement for the Korea-U.S. Free Trade Agreement (KORUS FTA) and ratification both by the U.S. Congress and Korean Assembly expectations are that the treaty will be implemented in the first quarter of 2012. Advocates and many critics alike see the FTA boosting annual commerce between the two nations into the billions of Dollars.
That said, although the treaty has been signed, both the U.S and South Korean government require a final legal review, then a period of public review and discussion prior to implementation.
1. The original plan was for KORUS FTA to take effect on January 1, 2012.
2. However, end-of-year holiday time restraints slowed U.S. government legal review of the final KORUS FTA wording and translation. This has resulted in a January implementation delay.
3. Once this U.S. review has been finalized (probably in February), the agreement documents will be reviewed by Korea. Then, as in the terms of the agreement the KORUS FTA must take effect within 60 days of finalized documents.
4. The 60-day period also serves as a public review of the treaty by citizens from both countries.
5. According to my sources, we can expect KORUS FTA to take full effect in March or early April.
To conclude, the final review process can be time consuming. For example, even though the treaty is signed, U.S. legal review teams have asked for additional documents and clarifications regarding the FTA wording and translations. Once the Korean teams respond to the U.S. side’s questions, the documents will be then sent to Korea for their final review. The Korean team then may have questions for the U.S. team, who in turn will need to reply, and so forth.
Look for updated as the unfold.