Korean peninsula vs. Bush adm. (7) Pressure to rise for market opening

(1) Will N.K.-U.S. framework change?
(2) Powell`s Korea policy
(3) Revision of North Korean aid policy
(4) Impact of NMD and TMD
(5) Reduction of U.S. forces in Korea
(6) How to coordinate North Korea policies?
(7) Pressure to rise for market opening

Hyundai Motor's North America branch office staffs have been watching every move the White House chief of staff, Andrew Card with a sense of concern.

The new chief once was vice president of General Motors and chaired the board of the American Automobile Manufacturers Association (AAMA). Having the one-time spokesman of the U.S. auto industry as chief administrative aide to the U.S. president might well strike Korean automakers as a signal for highlighting the lopsided car trade between South Korea and the United States as a major issue between the two countries.

In 1997, when Washington was about to resort to its Super 301 provision of the 1988 Trade Act against Korea over auto sales, he asked for a strong measure against Korea. Once he stamped out of the conference room in the heat of a wild debate with Korean trade officials.

New faces known as hard-liners being appointed to trade-related posts in the Bush administration one after another are giving the Korean government and industry the jitters. To begin with, the Republican party line is stronger than the Democratic line on trade. It seems highly possible that Bush will try to reduce the U.S. trade deficit by strengthening trade policy in place of cutting taxes as promised in his campaign.

The new secretary of commerce, Don Evans, has been a friend and confidant of President Bush for 25 years. He already has sounded a note of alarm when told the Senate confirmation hearing that he would protect U.S. industry and workers from unfair trade, increasing pressure for market opening by trading partners.

The Korean Foreign Trade Association's trade support team leader Park Jin-Dal says he is afraid that Korea's steel industry will bear the brunt of the mounting trade pressure.

The landscape of iron and steel interests in the United States looks bleak as could have been seen in the bankruptcy of Wheeling Pittsburgh last year. Attorney Denis Debe, who was named on the International Trade Commission early in January, enjoys full support from the steel industry and its labor unions. Though he is little experienced in international trade, he is certain to speak vigorously for import curbs and anti-dumping complaints on behalf of the industry and its organized labor.

Next come automobiles.

At a Washington seminar sponsored by the Korea Economic Institute on Jan. 5 the former U.S. Trade Representative Charlene Bashefsky criticized the closed auto market of Korea in strong terms, saying that Korea sold 500,000 cars in the United States last year but bought only 1,500 American cars.

The tough stands of Don Evans and Andrew Card, when combined, would not fail to give Korean auto industry a hard time.

The Bush administration is seeking fast-track authorization from Congress that could translate into a powerful stick to step up market pressure. The authority would enable the administration to go it alone in pushing through its high-handed trade negotiations with foreign governments, with the voice of its opponents virtually drowned out. The Washington government is also moving fast to launch a new round of World Trade Organization talks to focus on the opening of service and agricultural industries and on better protection of intellectual property.

Pressure for free trade could spill over the scope of such traditional issues as market opening and redress of unfair trading practices to cover fiscal and banking policies and corporate restructuring in Korea.

Harvard economics professor Laurence Lidsey was appointed chief economic advisor to the President. At a Congressional hearing in 1998 he objected to the rescue package by the International Monetary Fund for Korea. Secretary of the Treasury Paul O¡¯Neil, coming as he does from the manufacturing sector, is likely to treat restructuring in Korea from the perspective of trade agenda. A complaint made recently by U.S. chipmaker Micron Technology about the Korean Development Bank's purchase of Hyundai Electronics bonds is an example.