Delay In Approval Of U.S.-Korea Free Trade Agreement Could Give EU Companies Advantage Over U.S. Counterparts
This article was originally published in PharmAsia News
Executive Summary
SEOUL - U.S. President Barack Obama and South Korean President Lee Myung-bak failed to finalize a revised free trade agreement at the G20 Seoul Summit, raising the likelihood that the U.S. will be unable to ratify the agreement before a similar EU-Korea pact
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SEOUL - U.S. President Barack Obama and South Korean President Lee Myung-bak failed to finalize a revised free trade agreement at the G20 Seoul Summit, raising the likelihood that the U.S. will be unable to ratify the agreement before a similar EU-Korea pact. "We have asked our teams to work tirelessly in the coming days and weeks to get this completed, and we are confident that we will do so," Obama said Nov. 11 during a joint press conference with Lee after a two-hour meeting over lunch. "We want this to be done in a matter of weeks." President Lee also signaled that the two countries need to resolve some matters, but added: "It won't take a long time." He also noted that the sides will continue the FTA talks in Washington immediately after the G20 Summit. Lee and Obama had hoped to conclude negotiations - largely focused on automobile and beef issues - before or during the Nov. 11-12 Group of 20 meeting in Seoul. Officials said the two countries have made some progress regarding the export of U.S. cars to Korea, but little headway was made on conditions for the sale of U.S. beef in Korea. Washington has pressed Seoul to ease conditions for U.S. beef exports, stressing that this is one of the key issues blocking ratification of a trade pact by the U.S. Congress. But Lee has faced public uproar in South Korea in the past for lifting a ban on U.S. beef imports despite public concern over mad cow disease. EU Trade Advantage In July? Many South Korean officials, including the ambassador to the U.S., Duk-soo Han, expected the Korea-U.S. FTA to be finalized before the G20 Seoul Summit. Han recently warned pharmaceutical executives that the U.S. could slip from its dominant position in the Korean market if it is unable to finalize the agreement before the EU's similar FTA with Korea takes effect in July 2011 (Also see "Korea And U.S. Expected To Sign Korea-U.S. FTA Before G20 Summit In Seoul; No Surprises For Pharma" - Scrip, 10 Nov, 2010.) Despite assurances from Lee and Obama that a final agreement will be reached soon, the road ahead does not seem as smooth as it once had. In Korea, the main opposition Democratic Party and other parties have voiced strong objections to the agreement's ratification due to revisions they say unfairly benefit the U.S. at the expense of South Korean industries. No matter which FTA takes effect first, it likely will not be good news for South Korea's generic drug companies (Also see "Korea-EU Free Trade Agreement Creates Another Threat To Local Korean Pharmas; Good For MNCs" - Scrip, 21 Jul, 2009.). After the G20 Summit, President Obama and Lee moved to Japan and met again in Yokohama during the APEC meeting. No progress was reported for the U.S.-Korea FTA negotiations during the meeting in Japan. Although ratification by U.S. Congress and Korea's National Assembly appears to be delayed, the pharmaceutical provisions outlined in the FTA are not likely to be on the table for additional revision (Also see "U.S. And South Korean Presidents Say More Negotiation Needed To Ratify Free Trade Agreement But Pharma Provisions Seen Intact" - Scrip, 23 Nov, 2009.). - Peter Chang ([email protected]) |