The U.S. House this week approved a trio of trade deals with South Korea, Colombia and Panama.
The U.S. House this week approved free trade agreements with South Korea, Colombia and Panama that could spur more than $2.3 billion in added American agricultural exports. The agreement with South Korea alone is the biggest accord since the North American Free Trade Agreement, or NAFTA, in 1994.
The White House says the agreements will increase U.S. exports by $13 billion and create tens of thousands of jobs. And, the trade pact will make 95 percent of American consumer and industrial goods sold in South Korea duty free within five years.
President Obama celebrated the victory as he welcomed South Korea’s President to the White House Thursday morning in a ceremony full of pomp and circumstance.
At a joint news conference with South Korean President Lee Myung-bak Obama called the long-delayed trade pact "a win for both countries.”
President Barack Obama: "For our farmers and ranchers here in the United States, it will increase exports of agricultural products. From aerospace to electronics, it will increase American manufacturing exports, including those produced by our small businesses. It will open Korea's lucrative services market, and I'm very pleased that it will help level the playing field for American automakers."
Lee noted the trade deal still requires approval from South Korea's legislature, but agreed it would “mark a turning point in the enduring alliance between the two nations."
President Lee Myung-bak: "As we all know, the global economy is undergoing many challenges. The Korea-U.S. Free Trade Agremment will demonstrate to the world that we can create good-quality jobs and stimulate growth through open and fair trade. This is a good example."
Advocates of the trio of unilateral agreements say they will boost exports, give the economy a much needed spark and help put Americans back to work.
Despite overwhelming support, the debate was not without animosity. Democratic opposition pointed to past cases where free trade agreements were linked to factories moving overseas. Labor unions argued they will subject U.S. workers to increased foreign competition and end up costing American jobs.
Economists predict the agreements will lead to a $2.3 billion increase in farm exports and will create 20,000 agriculture-related jobs.
Korea is the fifth largest market for U.S. agricultural exports. But currently, America’s producers face an average tariff of 54 percent when exporting to Korea. Similar goods from Korea enter the U.S. at an average rate of only 9 percent. Passing this agreement corrects that imbalance and provides better access to Korea’s 49 million consumers. The Farm Bureau estimates that once the agreement is fully implemented, the U.S. could see $1.9 billion in increased farm exports.