[Congressional Record Volume 152, Number 79 (Monday, June 19, 2006)]
[Extensions of Remarks]
[Pages E1201-E1202]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




MARKING THE START OF FTA NEGOTIATIONS BETWEEN THE REPUBLIC OF KOREA AND 
                           THE UNITED STATES

                                 ______
                                 

                           HON. VITO FOSSELLA

                              of new york

                    in the house of representatives

                         Monday, June 19, 2006

  Mr. FOSSELLA. Mr. Speaker, the United States and the Republic of 
Korea (ROK) recently embarked on a new and exciting chapter in the 
history of Korean-American relations. June 5, 2006 marked the start of 
formal negotiations on a free trade agreement (FTA) between our two 
countries. I would like to recognize this important event, which I 
believe will lead to significant economic opportunities for Koreans and 
Americans alike.
  From a commercial perspective, the Republic of Korea-United States 
FTA (the ``KORUS FTA'') is the most important bilateral trade agreement 
the United States has negotiated in over a decade. After a remarkable 
recovery from the devastating effects of the Korean conflict, ROK has 
risen to become the 10th largest economy in the world with a GDP 
approaching $1 trillion and per capita income of over $20,000. ROK 
consumers have the means to purchase our goods, and ROK investors have 
the wherewithal to invest in our country.
  The Republic of Korea is now our seventh largest trading partner, and 
represents our sixth largest market for agricultural exports. Two-way 
trade exceeds $70 billion annually. And Korea is a growing market for 
U.S. service providers. The United States actually boasts a services 
trade surplus with ROK of $4.3 billion.

[[Page E1202]]

  But there is much more opportunity for growth and an FTA will serve 
as the catalyst for trade promotion. ROK's average tariff on goods is 
just over 11 percent--three times higher than the U.S. equivalent. The 
average tariff applied by ROK on agricultural products is even higher--
52 percent.
  This comprehensive trade accord will eliminate tariffs and address 
other barriers to trade in the United States and the Republic of Korea, 
thereby stimulating U.S. export growth and investment. As the U.S. 
International Trade Commission noted, U.S. goods exports to ROK could 
increase by 50 percent and U.S. agricultural exports could increase by 
200 percent with a fully implemented KORUS FTA.
  New Yorkers, in particular, could realize substantial benefits from 
the KORUS FTA as tariffs and other barriers are eliminated. In 2005, 
New York exported $1.4 billion in goods to the Republic of Korea, 
including machinery, computers and electronic products, transportation 
equipment, and chemicals. And the FTA would liberalize ROK services 
markets, creating exciting opportunities for New York's financial 
services providers.
  Agriculture is also very important to New York's economy. Our state 
is one of the top dairy producers in the country, along with apples, 
hay, and cattle. If we are able to lower ROK trade barriers on these 
goods, New York producers will increase sales as they expand their 
market share in the Republic of Korea. ROK, for example, applies a 45 
percent duty on apple imports.
  Despite our close bilateral alliance, U.S. market share in the 
Republic of Korea has actually decreased in recent years due to the 
influence of other emerging economies in the marketplace. Enhanced and 
preferential access to the ROK market for U.S. exporters and investors 
will improve our economic position in Asia and allow us to compete more 
effectively in the very challenging global marketplace.
  Further, the Republic of Korea has FTAs with several other countries, 
and is currently negotiating with Canada. The KORUS FTA will level the 
playing field for U.S. exporters who would otherwise experience a 
competitive disadvantage in the ROK market.
  In addition to the economic benefits an FTA could provide, it is also 
important to note ROK role as a long-standing U.S. ally.
  The United States and the Republic of Korea have a mutual defense 
treaty that dates back to 1953, and ROK has supported U.S. military 
efforts abroad, including in Iraq and Afghanistan.
  And in the aftermath of Hurricane Katrina, ROK pledged over $30 
million in aid for relief and recovery efforts--the fourth largest 
amount donated by any foreign country.
  I strongly believe that this new partnership between the United 
States and ROK is positive development for both of our countries. As 
the trade negotiations proceed, I look forward to working closely with 
the U.S. and ROK negotiators, my New York constituents, and fellow 
colleagues so that we can ensure this agreement is a win-win for both 
countries.
  Mr. Speaker, thank you for allowing me to extend my remarks noting 
this important occasion. I hope that my colleagues will join me in 
recognizing and supporting the KORUS FTA negotiations.

                          ____________________