High Stakes in US-South Korea Pact

In what is shaping up to be the most controversial trade deal since the signing of NAFTA in the early 1990s, the US is inching closer toward a free-trade agreement with South Korea. For US automakers and farmers, whose access to Korean consumers is currently limited by strict regulations and high tariffs, the deal offers an opportunity to profit from the tenth largest economy in the world. For South Korea, a new agreement promises increased income and employment, along with a counterbalance to growing dependence on China. Such enticements for both sides of the Pacific, however, may not sway opponents. Anti-American sentiment in South Korea has intensified as Seoul made major concessions to launch talks with Washington, and a BBC poll in December 2005 found that only 44 percent of the Korean public had a favorable view of US influence in the world. Another obstacle is that both nations are led by lame-duck presidents whose popularity is waning. Both governments, including members of US Congress, view the overall pact as positive, yet as numerous special interests in both nations continue to scrutinize the proposal, those sensing any loss in market position could quickly resort to protectionist arguments to scuttle the deal. – YaleGlobal