As he campaigns against what he describes as unfair foreign trade deals, Senator Barack Obama, the presumptive Democratic nominee, often singles out Japan and especially South Korea for criticism. Both countries, he complains, have erected “all kinds of restrictions and barriers” to shut out American products, including beef and automobiles.
“You can’t get beef into Japan and Korea, even though, obviously, we have the highest safety standards of anybody, but they don’t want to have that competition from U.S. producers,” Mr. Obama said last month in a speech to farmers in South Dakota. Last week, near Detroit, he asserted that “if South Korea is selling hundreds of thousands of cars to the United States and we can only sell less than 5,000 in South Korea, something is wrong.”
Many scientists, public health experts and consumer advocates in the United States and abroad, though, have suggested that American beef exports are lagging at least in part because United States safety standards are lax compared with those in Europe and East Asia.
As for automobiles, Korea’s auto imports have grown nearly tenfold in the past decade as trade barriers have eased, and Japanese and European car manufacturers have been more successful at capitalizing on those opportunities than their American competitors.
Mr. Obama’s criticisms, voiced as part of a populist message on the campaign trail, come as Congress is weighing a free trade agreement with South Korea, recently concluded by the Bush administration. Mr. Obama opposes the accord; in a May 22 letter to Mr. Bush, he said, “Approval of the agreement as negotiated would give Korean exports essentially unfettered access to the U.S. market and would eliminate our best opportunity for obtaining genuinely reciprocal market access to one of the world’s largest economies.”
Austan Goolsbee, an economic adviser to Mr. Obama, said of beef exports, “No one ever puts up a nontariff barrier and describes it as that.”
“Two facts are not in dispute,” Mr. Goolsbee continued. “Japan and Korea retain rules that prevent imports of U.S. beef, rules that other countries don’t have, and in countries that don’t have those rules, U.S. beef exports have returned to higher levels than before. So you’ve got to be highly suspicious at the outset.”
In South Korea, the beef issue in particular has become the flashpoint for recent protests against the government. In hopes of gaining American approval of the accord, President Lee Myung-bak has agreed to eliminate an 8 percent tariff on American cars and to relax some safety standards on beef imports. Thousands of people took to the streets to demand that Mr. Lee step down or spurn the trade agreement.
Five years ago, South Korea, which has 50 million people, was the third-largest importer of American beef and Japan the first, in both volume and dollar value, according to the United States Meat Export Federation. But an episode of the brain-wasting ailment known as mad cow disease in the United States late in 2003 led both nations, as well as some others, to forbid imports of American beef.
Japan, which allows imports of foreign beef only if the spinal cords, vertebrae, brains and bone marrow have been removed, lifted the ban two years later, after a food safety commission ruled that American safety measures were adequate. But the prohibition was reinstated in early 2006, after a shipment from the United States was found to contain some of the banned material.
That prompted a contrite apology by the American government, acknowledging that it was at fault. “This is an unacceptable failure on our part to meet the requirements of our agreement with Japan,” the secretary of agriculture, Mike Johanns, said then.
The prohibition has since also been lifted in Korea, though Japan and Korea continue to impose restrictions on the age of slaughtered cattle, which the United States finds onerous and has sought to modify. In the interim, however, Australian beef producers, who have been able to meet the rigorous sanitary conditions of their East Asian neighbors, have increased their market share at America’s expense.
As for automobile exports to Korea, the situation also appears to be more complicated than Mr. Obama’s remarks on the campaign trail would suggest. At the end of the last decade, that trade was visibly skewed, with Korea exporting more than 400,000 cars to the United States but importing in total 5,675, only 739 of which were American made, according to the American Chamber of Commerce in Korea.
Since 2003, however, Korea’s imports of foreign cars have nearly tripled, to 53,390 last year, according to statistics compiled by the Korean Automobile Importers and Distributors Association. Of that total, only 6,235 were made by Ford, General Motors or Chrysler, giving the Big Three an 11.7 percent share of the import market, compared with 16.3 percent five years ago.
One reason for the decline may be a longstanding engine displacement tax levied on automobiles by motor size, which appears to have benefited Japanese and European carmakers like Honda, BMW and Volvo. The United States considers the tax an unfair trade barrier and has sought to have it and other requirements “streamlined,” but defenders describe it as part of a Korean government strategy to reduce consumption of ever-more-costly imported gasoline and related carbon emissions.
“You can say that people in Korea don’t like American cars, but then you have to say why in nearby places people do seem to like them,” Mr. Goolsbee said. He added, “The Koreans have designed a system that will prevent competition from a segment of the market that is different from what they produce, and that is a nontariff barrier.”
The Association of International Automobile Manufacturers, trade group based in Washington, declined requests for an interview about Korean auto imports, as did the Korean Embassy. But in a letter sent to Democratic senators in 2006, the trade group noted that only one of Korea’s car manufacturers, Hyundai, is Korean-owned and that “some of the low export volume to Korea can also be attributed to G.M.’s investment in General Motors Daewoo Auto and Technology.”
http://www.nytimes.com/2008/06/15/us/politics/15check.html?ref=politics
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