Japanese, Chinese views on a Korea-U.S. free trade agreement

이태희 기자

I had a recent meaningful experience related to the proposed South Korea-U.S. Free Trade Agreement (FTA). I met with the Chinese and Japanese diplomats presently serving in Korea and had the opportunity to hear their honest thoughts on the matter. Although there are countless perspectives on a South Korea-U.S. FTA, I will explain my own opinion on the matter and present an argument based upon both the experiences of my acquaintances as well as on my experience as a reporter.

This, the first article of the series, will cover the perspectives of the Japanese and Chinese diplomats stationed in South Korea. My meetings with these officials were background briefings, and thus I cannot disclose the names of those with whom I met. Furthermore, because much of what they said reflected personal opinion, their comments should not be considered the official positions of their respective countries.

The day prior to my interview with the Japanese diplomat, an Uri Party representative serving in the Finance and Economy Committee said, "Japan does not want an agreement to be reached upon the South Korea-U.S. FTA." The reason was simple: Japanese manufacturing industries holding hegemony within the American market would be displeased if Korean manufacturing industries could penetrate the American market with new advantageous conditions. I myself have also stated similarly, "Japan dislikes such a treaty because, if a South Korea-U.S. FTA were to be signed, then the uncertain Japan-U.S. FTA could take on secondary status within the larger framework of a South Korea-U.S. FTA."

I stated the opinions of the legislator and myself to the Japanese diplomat; he nodded in agreement.

In addition, I asked him what he thought of the possibility for a Japan-U.S. FTA being concluded. He replied, "as Japan does not desire a FTA with America, the possibility is not high, and at present, the Japanese government does not plan on pursuing such a deal." He continued, "I am unsure of the changes that a South Korea-U.S. FTA will bring about."

And why does Japan oppose an FTA? The reason is simple. Japan has dominated the American market in the manufacturing sphere for such a long time that there is very little uncultivated market share to further develop. Though fields such as finance, service, culture and agriculture remain open, Japan is inferior to America in all three.

Generally speaking, all diplomatic agreements are mutually beneficial. Consensus is only reached when both sides find that there is some profit to be gained. If the conditions of a Japan-U.S. FTA are even slightly written in America's favor, Japan will stand firm until the very end.

And what of a South Korea-Japan FTA? The negotiations that started from President Kim Dae Jung's assurances are now ruptured because of the declaration of opposition by the South Korean government.

It should be noted that, of all the negotiations with involved countries, including the U.S., Japan and China, this was the first set of negotiations to be broken up midway through. Among Korean officials, there was a strong tendency to view this as a diplomatic failure. The Ministry of Foreign Affairs and Trade believed internally and explained externally that such a rupture would only result in disadvantage to South Korea.

However, it is also a fact that America and Japan have abused the threat of rupture to further their own interests. If one listens to experienced diplomats, America has always had the tendency of presenting new issues that they "completely forgot about" just as the treaty is about to be signed. This tactic is impossible for the Korean government to accept, and if adopted, the Korean representatives will likely suggest that the signing be delayed and that negotiations begin once more from scratch. It is said that the American side has applied pressure stubbornly until the end in pursuit of their own advantage, knowing full well that their counterparts fear the potential publicity surrounding a failure to reach a conclusion by the prescribed date. Of course, one may surmise that such past techniques by the U.S. are no longer of use. More than anything, I expect the newly self-confident South Korean Foreign Ministry to take a stronger diplomatic posture than the one previously seen in the midcourse declaration that an FTA "is possible." (For point of reference, I served roughly two years and four months, from 1997 to 1999, in the Ministry of Foreign Affairs and Trade.)

The Japanese diplomat explained to me that he "hopes discussions will reopen as soon as possible." I also heard from the Japanese side that the Chief of Korea's Ministry of Foreign Affairs and Trade, Hyun-Jong Kim, takes the hardest line against a South Korea-Japan FTA. Thus, he explained, Japan plans on restarting negotiations with Secretary Kim's successor.

Why then does Japan desire a South Korea-Japan FTA? Why is it Korea that views this sort of agreement as detrimental? To summarize in one sentence, it is because Korea is nearly the sole economically open country which Japanese manufacturing industries have been unable to conquer.

What about China? The honest response of the Chinese diplomat is as follows: "We desire the formation of a South Korea-U.S. FTA. A South Korea-U.S. FTA will be the foundation of a China-U.S. FTA. China is showing a keen interest in pursuing FTAs with foreign countries. Furthermore, China believes that a South Korea-China FTA should be concluded promptly."

The reason that China desires an FTA is the exact opposite of that of Japan. As a country that became the world's factory beginning in the mid-90s, China has many commercial markets yet to cultivate. This includes not only the South Korean market, but also that of the U.S., Europe, ASEAN nations, and so on.

The Chinese diplomat continued, "We wish not only for a South Korea-China FTA, but for a South Korea-China-Japan FTA." When asked regarding the chances of success of such an FTA, the Japanese diplomat gave only a vague answer, which I interpreted as a sign of disapproval.

From the Japanese perspective, China represents a potential threat. After all, the Japanese government itself cannot wholeheartedly deny that steady progress in high-level military relations with the U.S. is related to China. In considering the positioning of power in Asia, antagonism between Japan and China is inevitable within Northeast Asia. Indeed, the now commonly heard concept in Korea of cooperation among the three countries "South Korea-China-Japan" is only some ten years old. The shortness of this history is only natural if one takes into account that the opening of relations between South Korea and China began in 1992 and that China began its growth in earnest starting in the mid-1990s.

When the Roh Moo Hyun Administration took office, they first put forth the premise of a triangular system of relations between the three countries, referred to as the "Northeast Asian Central Nations." However, with both China and Japan striving to take the lead, this sort of cooperation is no easy task. I believe that it is Japan who holds the most negative view of the South Korea-China-Japan relationship model among the three countries.

I asked both the Chinese and Japanese diplomats how they evaluated the possibility of a South Korea-U.S. FTA. Both sides agreed, "it will unquestionably succeed." The judgment reached by both sides is that the potential damage from rupturing the negotiations will outweigh any foreseeable benefit of doing so. However, they withheld their opinion in regards to the time frame of an agreement being reached--such an estimate is regarded as top secret.

I anticipate that a South Korea-U.S. FTA will indeed take shape. However, I see it taking shape later than the date of next year, which is the indirectly quoted estimate from Seoul. I will continue this series of articles regarding the South Korean-U.S. FTA.