A sense of true stability may be a foreign concept in a country still divided and technically at war for the 64th year and counting. (Image: Yonhap)
SEOUL, Sept. 4 (Korea Bizwire) — A sense of true stability may be a foreign concept in a country still divided and technically at war for the 64th year and counting. Perhaps South Korea can begin importing this ‘sense’ after it renegotiates its Free Trade Agreement with the United States, as Donald Trump wants.
Late risers on Sunday were treated to the latest episode in the seemingly irrepressible saga starring Kim Jong Un and his nation of acolytes. The latest cooked up specialty of North Korean shenanigans reportedly caused tremors that reached into certain areas of China, which was handily deciphered by both Chinese and American geologists as emanating from an earthquake with an epicenter in Punggye-ri, North Korea, and was later confirmed by the U.S. and South Korean militaries to be the site of another nuclear test.
With North Korean media outlets confirming the exercise as a “perfect success” and a “state nuclear force”, the ensuing reverberations from the test would have left South Korea in a state of tremulous uncertainty without President Trump putting the icing on the cake of what some might say was the worst Sunday in recent memory.
Asked to comment on a report by the Washington Post on September 2 regarding his supposed directive to advisers to explore the possibility of terminating the U.S. Free Trade Agreement with South Korea, Trump sent the South Korean news landscape into overdrive by stating, “I am… It’s very much on my mind.”
Though this was not the first time he has mentioned his desire to terminate the deal, the timing of the latest “leaks” has done his South Korean allies no favors.
Trump’s salvo has taken South Korean government officials aback but left them determined to open negotiations with the U.S. government aware that all options, even termination, are on the table. (Image: Yonhap)
Experts scrambled to ease the escalating concerns by pointing out that Trump’s latest missive and “leak” smells more of a negotiating ploy than a statement of intent.
The sentiment, though still rooted in unease by the word “terminate”, is strengthened by the governing legislation surrounding the bill, which places the power to terminate trade agreements with the legislature, not the executive branch. Indeed, whether he truly wills it or not, Trump will need to succor the backing of Congress, which is considered unlikely at this juncture.
South Koreans must have breathed out a collective sigh of relief when media outlets reported on Trump’s even more vitriolic comments regarding the North American Free Trade Agreement (NAFTA), which is still being negotiated despite the U.S. president’s remarks on “the worst trade deal ever”.
Trump’s salvo has taken South Korean government officials aback but left them determined to open negotiations with the U.S. government, aware that all options, even termination, are on the table.
A spokesperson for the Ministry of Trade, Industry and Energy broached the issue, saying, “Should the FTA between the two countries be terminated, the economic fallout won’t be restricted to South Korea but will be unavoidable for the United States as well. The South Korean government will continue to explain its position and attempt to convince the United States using this angle.”
The spokesperson also revealed that during meeting held between the two countries to discuss the FTA on August 22, there was “no mention of the word ‘termination’”. (Image: Yonhap)
The spokesperson also revealed that during a meeting held between the two countries to discuss the FTA on August 22, there was “no mention of the word ‘termination’”.
Professor of International Relations Lee Hae Young at Hanshin University interpreted the situation as a ploy by the United States to bring the South Koreans back to the negotiating table. Furthermore, she stated that the Americans realized that a regular meeting between the two sides will not be sufficient to persuade the Koreans to acquiesce to their demands.
An interesting footnote amidst the heightened sensitivity are the numbers, specifically the goods and services trade balances. South Korean profits for goods reached a seven-year low, dropping to approximately 12.5 trillion won according to the United States Department of Commerce. This lowered South Korea from 6th to 10th place on the list of the top 10 trading partners with the United States when ranked by trade profits.
In addition, the numbers revealed that in terms of trade balances for services, the deficit for South Korea increased, while the United States profit margins increased from 10.9 billion to 14.1 billion dollars from 2011 to 2015.
All told, trade profits for the first half of the year in comparison to last year shrunk by over 30 percent. Moreover, imports from the United States grew by 21.8 percent, while exports shrunk by a slight margin.
With that in mind, it is unlikely that Trump will insist on a complete dismantling of the FTA. However, the prevailing mood is still one of uncertainty. Faced with a sulking China and poor economic relations and a cantankerous and unpredictable North Korea and possible military provocations, South Korea could have done without the extra dose of uncertainty injected into its national consciousness from its ally, and truthfully, its only hope in the present geopolitical crisis.
S.B.W. (sbw266@koreabizwire.com)
