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S. Korea Trade Deal May Be Delayed By Other Pacts

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S. Korea Trade Deal May Be Delayed By Other Pacts


S. Korea Trade Deal May Be Delayed By Other Pacts

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  • <iframe src="" width="100%" height="290" frameborder="0" scrolling="no" title="NPR embedded audio player">
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The Obama administration is hoping that Congress will quickly approve a new free-trade pact with South Korea. But that deal may snag on two other trade agreements that the White House says are not yet ready. House Republicans insist that all three deals must be considered together. NPR's Scott Horsley reports.

SCOTT HORSLEY: The free-trade agreement with South Korea is a key ingredient in President Obama's recipe for doubling U.S. exports. Trade Representative Ron Kirk says the agreement's lower tariffs and trade barriers should boost sales to South Korea by 10 billion dollars a year and support some 70,000 American jobs.

Ambassador RON KIRK (U.S. Trade Representative): Our number one mission is to create jobs. We firmly believe trade can be a valuable tool to help us get there.

HORSLEY: Tom Spika believes in trade as well. Spika runs a manufacturing company in Lewistown, Montana that makes equipment for maintaining aircraft. He's recently ventured into the South American market and thinks sales to Colombia could be worth up to 30 million dollars over the next five years.

Mr. TOM SPIKA (President, Spika Welding and Manufacturing, Inc.): Coming from a small rural community in the middle of Montana that equates to jobs and opportunity for growth of our local economy, if we can open up a new door and new opportunities for sales into a market that has that kind of potential.

HORSLEY: But Spika's Colombian sales have been hampered by tariffs that raise the price of his goods by about 15 percent. The Colombians are willing to eliminate those tariffs, if the U.S. would approve a Colombian free trade agreement.

Mr. SPIKA: They pretty much have the attitude: Look, we want to do business with the United States, but if you don't want to do it, don't complain when we take our business elsewhere.

HORSLEY: The Bush administration negotiated trade agreements with both Colombia and Panama, but they were never approved by Congress. The main objections concerned labor rights. The Obama administration is now working to strengthen those agreements, as it did with the South Korean deal. But Trade Representative Kirk says the Colombian and Panamanian pacts are not yet ready.

Amb. KIRK: We don't believe this is going to be a long, drawn-out process. But there is some critical work to be done over the next several weeks and months.

HORSLEY: So the White House wants Congress to endorse the Korean trade agreement this spring, and says it hopes to finalize the other two deals later this year.

Representative KEVIN BRADY (Republican, Texas): That timetable won't work for House Republicans.

HORSLEY: That's Republican Congressman Kevin Brady of Texas, who chairs a key trade subcommittee. He and other House Republicans want the Korean, Colombian and Panamanian agreements all taken up by July 1st.

Rep. BRADY: We've been very clear that it would be a mistake to send the Korean agreement alone. It's very important that we've reached agreement on the package of the three, before we start that process.

HORSLEY: In other words, the Korean trade agreement, which Republicans and the White House agree on, could become a hostage to the two other deals.

Jeff Schott, of the Peterson Institute for International Economics, says at a minimum, Republicans want to prevent the Colombia and Panama deals from languishing much longer.

Mr. JEFF SCHOTT (Senior Fellow, International Trade Policy, Peterson Institute for International Economics): They're using a variety of legislative tactics, some of them coarser than others, to encourage the administration to come up with a concrete plan of action on Colombia and Panama.

HORSLEY: Trade Representative Kirk will be pressed for such a plan this week, when he appears before the Senate Finance Committee. Kirk says while he appreciates Republicans' sense of urgency, many Americans are still skeptical of free trade. So the White House wants to take its time to get the agreements right.

Amb. KIRK: One of the reasons we believe there is now such widespread support for Korea, is we did not rush to make a judgment. We did not just do a deal for the sake of doing one. We produced a deal that frankly was better.

HORSLEY: Republican Congressman Brady agrees; hard bargaining by the administration resulted in a more favorable deal with South Korea. Now, Brady and his GOP colleagues are trying to drive a hard bargain of their own.

Scott Horsley, NPR News, Washington.

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