PROPOSAL IS ‘DEEPLY FLAWED’
Gettelfinger urges Congress to reject Korea trade deal
It’s what is known as an imbalance in auto trade, a complicated issue that can be broken down into simple math.
In 2007 imports of Korean automotive products into the United States were valued at $11.3 billion, while U.S. exports of similar products to Korea amounted to just $1.0 billion. The net result? A $10.3 billion U.S. automotive trade deficit with Korea.
Enter the Bush administration, which backs the proposed Korea-U.S. Free Trade Agreement (KORUS-FTA) that would clearly exacerbate the imbalance in auto trade between the United States and Korea.
In Sept. 24 testimony before Congress, UAW President Ron Gettelfinger called the proposal’s auto provisions "deeply flawed" and urged members to reject it.
"The UAW calls on Congress to reject the KORUS-FTA until these auto provisions are renegotiated and replaced with measures that will require Korea to dismantle its nontariff barriers to U.S.-built automotive products before it is granted any additional access to our market," Gettelfinger told the Subcommittee on Interstate Commerce, Trade and Tourism Committee on Commerce, Science and Transportation.
The proposed agreement would immediately eliminate the 2.5 percent U.S. tariff on the vast majority of autos and auto parts imports from Korea. Also, it would phase out the U.S. 25 percent tariff on imports of pickups.
Both provisions would trigger a surge in automotive imports from Korea, as it would be relatively easy for Korean manufacturers to ramp up production for export to the United States.
But the proposal would allow Korea to maintain a variety of nontariff barriers that effectively keep their market closed to U.S.-built automotive products.