U.S., South Korea fail to reach free-trade deal
Thursday, November 11, 2010; 10:04 AM
SEOUL - Negotiations over a U.S.-Korea free-trade agreement faltered Thursday after four days of discussions, a setback for the leaders of the two nations and a blow to efforts to rekindle broader world trade talks.
White House officials said the discussions foundered over long-standing disagreements over U.S. access to the Korean auto and beef markets.
Despite optimism from both sides as they began bargaining, domestic political concerns weighed heavily on the talks and ultimately appeared to have prevented the final compromises needed to secure an agreement.
The two sides pledged to continue the discussion, and said that they had made progress in recent days toward narrowing disagreements.
"We have asked our teams to work tirelessly in the next days and weeks to get an agreement, and we are confident we will do so," President Obama said after his meeting with South Korean President Lee Myung-bak.
Obama said he didn't "want months to pass before we get this done. We want it to be done in a matter of weeks."
The failure to produce a signed agreement in Seoul, where the world's largest economic powers are gathering for the G-20 summit, is significant, and illustrates the difficulties facing the Obama administration's efforts to use free trade initiatives to boost U.S. exports.
Obama had set a personal goal of completing the Korea deal during the summit, and Lee had cast the agreement as a way to deepen the strategic and political relations between the two nations, as well as economic ties.
Upon his arrival at the summit, the U.S. president released a letter calling for resumption of the Doha round of world trade talks. Concluding a bilateral deal with Korea would have been a tangible demonstration of intent.
Now, heading into the last half of his current term in office, Obama has neither advanced the series of partially completed trade agreements inherited from the Bush administration - including the one with Korea - nor put his own stamp on a new one.
The dilemma: how to balance the "gold standard" agreement of fully open markets and adequate labor and environmental standards that Obama held out during his campaign with the real-world compromises often demanded by smaller or less-developed countries.
As a candidate "Obama pledged to chart a new course for American trade policy," said Lori Wallach, director of Public Citizen's Global Trade Watch, which argues that the Korea pact is also out of step on issues like financial regulation. "The political liability of an Obama flip-flop ... pushing Bush's Korea deal, cannot be overstated."