Gov't CPTPP push to drag on until after presidential election

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Gov't CPTPP push to drag on until after presidential election

The National Assembly is in a plenary session, during which a bill on Regional Comprehensive Economic Partnership (RCEP) passed, Dec. 4. Korea Times file

Gov’t refuses to broach politically charged issue for fear of losing rural votes

By Lee Kyung-min

The government is dragging its feet regarding discussions on joining a trade agreement among 11 countries in the trans-Pacific area.

Some officials say the approach seeks to limit possible backlash from the agricultural sectors, certain to lose out in the global market competition, ahead of the presidential election next year.

Any further stonewalling in the push for the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) will result in a rapid escalation of collective protest by the traditional industry, already at a significant disadvantage due to the passage of a bill that ratifies the similar but less invasive Regional Comprehensive Economic Partnership (RCEP).

The RCEP, a trade agreement among 15 nations set to take effect next Feb. 1, will reduce tariffs in the 10 ASEAN member nations from between 91.9 percent and 94.5 percent per country, up significantly from the previous rate of between 79.1 percent and 89.4 percent. Korean steel, cars and petrochemical products will be sold at cheaper prices there.

Greater bilateral openness for online games, animation and entertainment including films is expected to translate to the country’s cultural industry registering an annual growth of 1.1 percent.

The CPTPP is widely considered the most critical step to strengthening Korea’s presence on the global stage and therefore underpins the future growth of the export-reliant economy, a reason why state think tanks and top policymakers have for months been seeking to join the mega trade deal.

But government officials are refusing to broach the issue at the expense of the country’s export growth.

The trade volume of RCEP member countries ― including the 10 ASEAN countries, Korea, China, Japan, Australia and New Zealand ― stands at around $5.6 trillion (6,621 trillion won), accounting for 31.9 percent of global trade. The trade volume of $484 billion between Korea and RCEP member countries last year accounted for nearly half, or 49.4 percent, of Korea’s total trade. The combined trade volume of CPTPP member countries accounts for 15 percent the world’s trade volume total.

Pushback

Korea Advanced Farmers Federation, representing about 140,000 agricultural members nationwide, held a press conference, Dec. 1, decrying the passage of the RCEP ratification bill by the National Assembly Foreign Affairs and Unification Committee.

“The government is railroading the RCEP ratification, despite the unified protest by the 2.5 million workers in the agricultural industry,” the group said during its rally in front of the National Assembly in Yeouido, Seoul. “Any further push with our opposition disregarded will lead to a complete loss of trust in the government.”

The group’s senior member Choi Beom-jin said that a collective walk-out will be inevitable if the government joins the CPTPP, amid widespread anxiety already elevated due to the RCEP drive.

“We will organize an anti-government rally, as instigated by policymakers forfeiting the agriculture industry and by extension food sovereignty,” he said.

Policymakers and the trade authorities are expected to leave the issue untouched at least until after the presidential election scheduled for March next year.

The government has twice postponed a ministerial-level meeting among key economy-related ministries, delaying the timing for joining the CPTPP altogether.

This is a clear shift in stance from two months ago, when Finance Minister Hong Nam-ki, who doubles as deputy prime minister, said joining the agreement was almost a foregone conclusion.

“Time is against us,” Hong said during a meeting with reporters in Washington, D.C., Oct. 14 (local time). “The government has prepared for the policy revision measures to be entailed by the joining of the trade agreement over the past two years. Whether and when Korea joins the CPTPP should be determined by late October, or early November at the latest.”

A similar tone was used by Trade Minister Yeo Han-koo when he attended a virtual meeting with trade experts from CPTPP member countries including the U.S., Singapore and Australia, Oct. 21. “The tectonic shift in the trade order among relevant member countries is in full swing. The CPTPP has great strategic value,” he said.

President Moon Jae-in said on the occasion of Korea’s 58th Trade Day, Nov. 30, that the government will expand trade cooperation with countries in Central and South America and the Middle East, stopping short of mentioning the CPTPP, Monday.

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