Nov 7, 2011

Will the Failure to Pass the KOR-US FTA by Korean NA Harm Korea?

The KOR-US FTA has a great likelihood of not passing the Korea National Assembly this year, because of the resistance of radical liberals and the inactivity of the GNP and the Administration.   The GNP fears that pushing the bill onto the floor of the National Assembly will cause an election defeat in the elections next year.

I fear that Korea will be greatly harmed by the peculiar behavior of the liberals and cowardliness of the GNP leadership and conservative presidential candidates.
  1. Korea is an export country and without the benefits of exports the country will be relegated to the ranks of the less-developed world.  Most Korean exports are products that are bought because of no negative impressions, competitive efficiencies and the impression that the product is of a  high quality.  Increasingly, competitors, including China, Vietnam, Indonesia, and Malaysia are catching-up with Korea.  In many cases, China can make an equal quality product at a much lower cost.  The Korea-US FTA will allow for more focus on Korea, while increasing its competitive advantage.  Will Korea be competitive in the near future?
  2. Korea is one of the most nationalistic nations in the world, but this is only realized by foreigners living in Korea.  Recent bad press caused by the Lone Star fiasco, SSangyong Motors riots and other acts that demonstrate the nationalistic fervor will lead to consumers and investors to reconsider Korea.  Is this the last straw? -Will this lead to the media writing on Korean nationalism?  Will this lead to the scorn of consumers and investors?
  3. Korea has a very vocal, but small, anti-American presence as evident in numerous and often violent protests against American interests.  Some believe that this small group of radical liberals has been infiltrated by North Koreans.  If the information is not true, most will contend that Korea, at a minimum, has a small portion of the population that are sympathetic to North Korea and despise capitalism.  Why was the Korea-EU FTA passed, but not this agreement?  Is this an indication of North Korean sympathies and anti-American tendencies and thus increased risk in doing business in Korea?.
I will be adding to this list - please assist.   If you post your name, I will add your name to the post above if you so wish.
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SeanHayes@ipglegal.com