Back in 2007, Bush Administration signed a trade agreement with South Korea which waited until the current administration to sign off.
Well, it appears that the Obama Administration is not happy about certain provisions in said agreement.
The Washington Post reports that Chief U.S. Trade Negotiator Ron Kirk said that the administration will not present the treaty to Congress until the auto provision is amended. And what's this point of contention? Apparently the trade agreement allows South Korean auto manufacturers to sell their products in the U.S. but restrict U.S. automakers in Korea.
Ford, Chrysler, and the United Autoworkers Union agree that the treaty does not do enough to eliminate tariff barriers. Other U.S. businesses are on the side of the Korean government, arguing that the European Union already has agreed to a free trade treaty with South Korea. The president of the U.S.-Korea Business Council says that an agreement of the pact could lead to an immediate job creating stimulus.
And South Korea has said that it will not re-negotiate the provision. It added that it has eliminated an 8 percent tariff on U.S. autos sold in South Korea under the pact while the U.S. is allowed to phase out a 2.5 percent tariff on gasoline and diesel-powered cars over three years. The pact also calls for the U.S. to eliminate a 25 percent tariff on pickup trucks over a 10 year period.
Kirk is expected to meet with South Korea’s trade minister. President Barack Obama and South Korean President Lee Myung-bak will also be meeting in Singapore and Seoul Korea during Obama’s 10-day trip to Asia. Obama and Lee will also be attending the Asia Pacific Economic Cooperation Summit in Singapore.