[Editorial] Knotty trade issue

Korea Herald

19 hours ago

US said to demand Korea further open agricultural, livestock markets
Further opening of the Korean agricultural and livestock markets has emerged as a major issue in Korea's tariff and trade negotiations with the US.
Trade Minister Yeo Han-koo said that trade negotiations on the agricultural sector always come with pain, but that there are some parts in which the country can make strategic decisions for a broader trade deal. He made the remark Monday during a meeting held with reporters to brief them on the progress of tariff negotiations he had during his visit to the US.
Washington is said to demand that Seoul increase rice imports from the US; import American beef from cattle aged 30 months or older and living modified organism potatoes, a genetically modified crop; and ease quarantine on US apples.
The Korean government is expected to finalize its proposals this week for tariff negotiations with the Donald Trump administration.
Increasing the imports of rice and beef, among others, is a socially and politically sensitive matter for Korea.
It is directly related to the foundation of the country's agricultural industry, its food sovereignty, the existence of its farm villages and regional economy
Opposition from farmers is already strong.
For these reasons, Korea has not fully opened its rice market.
It obligatorily imports 408,700 metric tons of rice each year from five countries, including the US, at a low tariff rate of 5 percent. The figure amounts to about 11 percent of the 3.7 million tons that Korea produces at home annually. The US quota of some 132,000 tons takes up about 32 percent of Korea's rice imports. Korea imposes a 513 percent tariff on imports in excess of the quota, effectively banning imports of rice that go beyond the obligatory minimum.
Unlike Japan, Korea has not experienced a shortage of rice. Rather, there is a surplus. Arguments for an increase in rice imports are less convincing here.
Korea has only imported US beef from cattle younger than 30 months since fear of mad cow disease sparked nationwide protests against US beef imports in 2008.
Despite these restrictions, Korea is still the largest importer of American beef in the world. Nearly half of the beef that Korea imported last year was American.
The US does not appear likely to make a great profit from the additional opening of the Korean beef market.
Yet, it has pointed to Korea's restriction on US beef imports as a typical non-tariff trade barrier.
Koreans' aversion to US beef appears to have dropped remarkably, but US beef from cattle aged 30 months or older is likely to revive fears of mad cow disease and memories of protests.
US-grown LMO potatoes were assessed as safe by the Rural Development Administration in March. Justification for the import ban on LMO potatoes has weakened.
Importing apples is expected to cause vehement opposition from farmers.
Many farmers grow apples in Korea, taking up 23 percent of its fruit cultivation area.
Considering this, the government has practically banned apple imports since 1993 on the grounds that harmful insects could be brought in from abroad.
Even when apple prices soared due to a poor harvest, Korea moved to increase imports of alternative fruits such as bananas, pineapples and mangoes, but not apples. Importing apples has been considered taboo.
Proposals for negotiations are not yet finalized, but some Korean farmer groups are condemning the government for trying to make agriculture a scapegoat again.
It will not be easy to persuade farmers within the two weeks left till the July 31 deadline for tariff negotiations. Yet, it is not easy to reject all of the US demands, either.
Should the 25 percent "reciprocal" tariff be imposed on Korean items exported to the US, the Korean economy will reel from shock.
In a macro perspective of national interests, a flexible attitude for strategic decisions is needed. Selective or conditional acceptance is more realistic than blanket refusal.