Problems of Korean Domestic Politics – The KORUS FTA as a Case Study

The rise of China has become a fact although whether it is peaceful or not is still controversial. Having the current hegemon (the US) as an integral player despite the actual geographical distance, it brought new dynamics in East Asian geopolitics. Naturally, Sino-US relations (or power competition) have become a major issue among scholars and experts. The reason is simple: their relations make peripheral states feel uncomfortable. South Korea in particular, has had a dilemma between the two powers; China as a no.1 trade partner on the one hand, and the US as an old and firm security ally on the other hand. Is it too fortunate to have both? Yes or No. One thing for sure is that both powers attempt to have more impact on South Korea. In other words, Korea is becoming a competition arena for them. Regarding this surroundings, it is a significant time for South Korean decision makers. However, it seems that they are making a situation worse. The KORUS FTA is a case that proves this point.

The Two Parties and the KORUS FTA

Before starting, let me briefly inform you of basic knowledge about the Korean domestic political party setting. Korea has several parties, but the main parties are the Grand National Party (GNP) and Democratic Party (DP). The GNP is currently the ruling party and it can be regarded as a conservative party in terms of its political characteristic. On the other hands, DP is considered progressive. Interestingly enough, recently both parties have changed their party names. In December 2011, DP changed its name as Democratic United Party (DUP) with unification of Citizens Unity Party (시민통합당) and Federation of Korean Trade Unions (한국노동조합총연맹). Most recently, yesterday (February 2, 2012), GNP also changed its name, “Saenori (새누리)” or “New World” party. (It does not offer any official English name, so I referred to the BBC News article. See here) However, this change is quite different from the DUP’s because GNP’s name change was not a result of unification among several parties. This dynamic party composition in Korean domestic politics is critical to understand Korea’s political problem.

As a fact, the South Korean economy has the highest trade dependence rate among the G-20 countries. Considering the severe trade dependence (it is almost 100% in 2011. See here), the importance of trade in its economy cannot be stressed enough. And having China as a no. 1 trade partner, South Korea’s asymmetric trade dependence on China is getting bigger. S.C. Denney’s recent post, Unnatural Alliances and Northeast Asia’s Shifting Geopolitical Landscape, also points this out:

Korea is extraordinarily dependent on exports for economic growth. Most important to note is the fact that Korea is becoming exceedingly dependent on China’s market to feed this growth.

In fact, Korea’s both imports and exports to China is almost double those to the US (see also S.C. Danny’s table1 and table 2). With this fact in mind, it is natural for South Korea to pay close attention to its relationship with China if it is a rational state. If Korea ruined the trade relationship with China, it would bring huge negative effect on Korea’s economy. No state wants a sluggish economy. It is natural. In that regard, the KORUS FTA ratified by the National Assemble of South Korea on in November 2011 can be assessed as an irrational decision because it would harm Sino-Korea trade relationship, which would hinder Korea’s economic growth as a whole. Moreover, the ratification process was even more problematic because it was ratified in surprise vote. It was the first time in history. Let me introduce an excerpt from the Korean newspaper, JoongAng Daily:

The long-stalled Korea-U.S. free trade agreement was finally ratified by the National Assembly yesterday after the ruling Grand National Party blindsided liberal opposition lawmakers with a surprise floor vote in a chaotic session complete with a tear gas attack in the main chamber.”[…] “The Blue House yesterday welcomed the news. “It’s fortunate that the FTA is ratified, although the process was difficult,” said Choe Geum-nak, the Blue House senior public affairs secretary. “We thank the people for giving unconditional support for the FTA. We also thank the lawmakers who have worked hard for the ratification.”

Despite the ratification, the severe debate between the two parties (Grand National Party and Democratic United Party) is still going on. About a week ago, the newly elected Supreme Council of the main opposition Democratic United Party pledged to fully repeal the disputed Korea-U.S. Free Trade Agreement. According to the Korean Herald on January 17, 2012, the new DUP leader, Han Myeong-sook, who was the nation’s first woman prime minister under the Roh Moo-hyun government, said after being elected party head on Sunday.

All council members agree that the KORUS FTA was lopsided and flawed. We shall abolish the entire pact and restart the talks from scratch.

As seen above, Korea’s two dominant parties appear to be at the end of the line. Considering that Korea will have two big elections this year (the general election in April and the presidential election in December), the current tension between the two parties is dangerous. Consequently, the future of the KORUS FTA is unclear in spite of the ratification.

Grand National Party’s Rationale

Since GNP is the ruling party (of course, now the name changed to “Saenori” or “New World” Party. But let me use the old name, “GNP”, because the FTA issues in this writing deal with the past), its rationale for the KORUS FTA takes the same course with the Lee Myung-bak government. The rationale includes two factors: economic and security.

In order to find official statements, I visited the official website for KORUS FTA. This website is run by the Korean Ministry of Foreign Affairs and Trades. One thing interesting about this web page was that only Korean was available in the website. I guess it is because the web site was designed to provide information for its people. However, I believe other languages (at least English, because it is a website for the KORUS FTA) should be available too in order to avoid misunderstanding or misuse of information. Anyhow, this site provides the entire official documents and informs Korean people of the details and specific impacts of the KORUS FTA. (Visit here, http://www.fta.go.kr/korus/main/index.asp)

Throughout looking at this website, I discovered one more interesting thing: the information provided on the website is all about economy. On one section called 한미FTA기대효과 ( KORUS FTA expected effects), in particular, includes six sub-sections, and each introduces specific effects by providing easily understandable materials. Let me introduce some to you.

[Picture 1]
Source: KORUS FTA website
(Click here to see the full text)

[Picture 1] says that the KORUS FTA opens economic highway (경제고속도로가 열린다!), which means it will accelerate Korea’s economic growth. If you click the full version, you will see how interesting it looks because it is filled with cartoons.

[Picture 2]
Source: KORUS FTA website
(Click here to see the full text)

[Picture 2] also talks about the economic effect. It says that the KORUS FTA will be the first step for a strong trade state (통상강국). The full version includes a lot of graphs, charts and diagrams. It even provides FAQs regarding the major issues such as agriculture, ISD, jobs, medical welfare and etc.

[Picture 3]
Source: KORUS FTA website
(Click here to see the full text)

[Picture 3] emphasizes the impacts of KORUS FTA on our daily lives. The full text consists of two parts: Ⅰ. 한·미 FTA 최대 수혜자는 ‘소비자’(The main beneficiaries of the KORUS FTA is ‘consumers’) and Ⅱ. 한·미 FTA 시대, 중소기업 경쟁력 高고GO! (Small and medium-sized companies’ competitiveness goes up!)

As seen above, all three pictures and the full texts seem to be very interesting and easy to understand, but I wonder how many people actually see this documents or how many people are aware of the existence of this website itself. Regardless of it, this KORUS FTA website is running well at this moment by offering economic effects. Security-related effect was hard to be found. I found one from a general document called “한ᆞ미 FTA, 우리 미래를 위한 선택입니다 (KORUS FTA, it is a decision for our future).” Out of the whole 162 pages, only three sentences were about security. It was on page 4 briefly saying, we can expect KORUS FTA to improve US-Korea relationship by expanding the scopes of the US-ROK military alliance into economy. But that was it.

Then, the GNP’s rationale is mostly about the economy? Of course, not. Since Lee Myung-bak’s government and the GNP value the US-ROK alliance as a cornerstone of its foreign policy, the KORUS FTA means a lot more than the economic effect. Korea’s official website, Korea.net shows this clearly:

Overall, President Lee’s latest U.S. trip produced win-win results for both countries. The most meaningful outcome of the trip comes from the agreement between the two leaders to upgrade the 58-year-old Korea-U.S. alliance by increasing its scope. […] The two leaders also agreed to renew and upgrade the joint vision for the alliance between South Korea and the United States which they initially adopted at the Korea-U.S. summit in June 2009 so that the two countries can work together to resolve challenges facing the international community, such as climate change, the global economic crisis, and poverty.

However, it seems hard to find the connection between the KORUS FTA and the US-ROK alliance. Professor Chung-in Moon at Yonsei University commented in his class last semester that the FTA is one thing and the military alliance is another. That is, Lee Myung-bak’s government is trying to appeal to the people with using the wrong information. I agree with his point. I believe Lee Myung-bak’s administration and the GNP should ask for popular support by providing appropriate information and answering what people wonder about. The Koreans and the DUP were angry not about the ratification itself, but upset about the method that GNP and the government had used in the ratification process. If they had proper and enough evidence to support their argument, would they have to ratify in surprise?

There is not much room for maneuvering by incumbent President Lee Myung-bak’s government during its final year. It is too risky to make a major move. Instead, it is best to try to maintain the status quo and lessen the burden on the next administration. The candidates running in the December presidential election should, in fact, be prepared to take up the challenge. They must thoughtfully study and concoct a long-term security blueprint for the country.
Ching-in Moon on January 3, 2012 in JoongAng Daily

Fortunately, if not hopeless at all, Korea has one more chance: this year’s two elections. I hope Koreans vote for the policy and not for the party itself. Before that, I do hope Korean politicians to appeal with great policies, not by criticizing the opposition party. People don’t need no more childish politicking between the two parties. Lastly, I do expect the future leaders to be prepared to take up this important situation.