AJOT Digital Edition
Issue #586 | Latin America Trade | Canada Ports

Cover of issue-586.png

Latin America Trade

Canada Ports

View Issue #586 Now!

2014 Media Kit
  • Share this article:

S. Korea taking steps toward wider US beef trade

By: | at 08:00 PM | Channel(s): International Trade  

South Korea has taken the first tentative steps toward expanding beef trade with the United States, which would be a milestone toward approving a major trade deal, a South Korean source said.

South Korea has requested information on sanitary procedures from the US Agriculture Department, one of eight steps South Korea must take before it can relax import rules, the South Korean government source in Washington, requesting anonymity due to the sensitivity of beef trade, told Reuters.

“The beef issue I think will be ultimately resolved,” the source said, adding that a series of recent snafus around US beef exports has made for acid relations just as the countries try to build support for a major bilateral trade deal.

In April, negotiators wrapped up the US-South Korea free trade pact, which is expected to increase annual trade by as much as 55% as it lowers trade barriers for farm products, manufactured goods like cars, and services.

But the deal is sure to founder, lawmakers and farm interests vow, if Seoul does not agree to open its markets to a broad range of US meat products—and fast.

Last year, under an agreement to end a lengthy ban on US beef, South Korea agreed to accept boneless beef from animals under 30 months old. US beef had been shut out of the country since 2003, when the first US case of mad cow disease appeared.

US beef interests want to see all beef products, including bone-in meat from older animals, in Korea.

But in order to change import rules, South Korea must dispatch inspectors to US slaughterhouses and processing plants, the source said. After that, South Korea will hold consult government and private officials to decide if it will relax its rules.

If that happens, the two countries must then sit down to work mutually acceptable import rules. Those rules have to undergo a public comment period in South Korea before the country can issue import certificates and trade can finally resume.

If things go smoothly, the source said, the whole process may be wrapped up by September.

NEW SNAFU

If the beef issue has already clouded ties, things only darkened last week when South Korea discovered beef ribs—now prohibited—in several US meat shipments.

USDA has suggested a human error is to be blame, possibly on the part of department inspectors, but Seoul has effectively halted trade until it gets the results of a US probe.

South Korean government sources said that they don’t expect the most recent incident to derail the certification process. The US meat industry has reacted cautiously, acknowledging rules were broken here, but the flap only fueled anger in Congress.

Sen. Tom Harkin, who heads the Senate Agriculture Committee, called the latest flap “a step backward” between the two nations. “That’s why USDA better get on top of this. It doesn’t help our negotiations with South Korea,” he said.

It remains unclear, moreover, whether South Korea will embrace Washington’s interpretation of a new US risk classification from the World Organization for Animal Health, which officials here see as proof trading partners should accept all beef.

The US/South Korea trade deal would be the biggest for the United States for 15 years. But it faces other hurdles, including opposition from auto-state lawmakers who believe the deal gives a raw deal to the US vehicle industry.

The source, though, is betting that Congress will approve the deal despite the auto industry’s rancor.

Facing opposition from congressional Democrats, the Bush administration has been working with members of Congress to create new labor and environmental rules for the South Korea deal and three other trade pacts that still need approval.

The source said South Korea has not yet reviewed those changes. (Reuters)