Talking trade

The unfortunate international trade facts speak for themselves:

• Despite the economic crisis that emerged in the second half of last year, which lowered American consumer income and demand for foreign imports, the U.S. bilateral trade deficit with Korea increased from $13.0 billion in 2007 to $13.3 billion in 2008.
• The largest part of this trade deficit was in motor vehicles and parts, which also increased in 2008 to $10.5 billion (79 percent of the total 2008 trade deficit with Korea).

Record trade surplus for Korea

• The Korean government recently announced that it had posted a record trade surplus through the first half of 2009, as the value of imports fell more than their exports. This result was achieved through an explicit Korean export-led development strategy, pursued even in the face of the global recession.
• The Japanese automakers control 96 percent of the domestic auto market in Japan; Korean automakers control 95 percent of their home market. The former Big Three have 45 percent of the U.S. market. This has much more to do with government policy than with consumer preference.
• Promoting the purchase of domestically manufactured autos and discouraging imports should be a key part of our overall economic policy approach.

U.S.-Korea agreement stalled

• The Korean government has stated repeatedly and publicly that it will not renegotiate the auto provisions of KORUS FTA. President Obama, by contrast, has expressed concerns about the auto provisions that have to be addressed before he will consider sending it to Congress for approval.
• The UAW and the Korean Metalworkers Union believe the entire agreement must be renegotiated to protect the interests of autoworkers in both countries.