Critical Moment of the First FTA Negotiation

The sixth negotiation for Korea-Chile FTA held in Geneva, Switzerland from October 18 to October 21, was failed in taking a final mutual agreement.

Both of countries decided to control the final opinion through e-mail by October 24, in terms of finance and service field. However, two countries will hardly withdraw their existing positions at present, and so the FTA negotiation could go back to the beginning.

Only Korea could not lay the responsibility on not taking the final agreement through this negotiation. As a direct reason of the negotiation failure, Chile required to exclude the finance and service field to the last moment. However, the Korean government has been again in disarray whenever a trade negotiation is failed.

▽Ministry of Foreign Affairs and Trade(MOFAT) Attached to ‘Negotiation Agreement’ 〓 The Ministry of Foreign Affairs and Trade(MOFAT) showed nervousness saying “We will sign in the agreement provisionally” before leaving for Geneva. It also mentioned on October 20, “We will make the provisional signature next dawn because we already agreed all the core issues”.

The attitude that decreases the negotiation in the negotiation process is one reason that Korea takes a high-handed attitude saying, “We could break the negotiation if Chile doesn’t accept it.”

The official of MOFAT said, “There are only small issues.” People will criticized the Korea representatives for getting negotiations without knowing that the important issues have been accepted by Chile and the Ministry of Finance and Economy.

It is indicated that Korea is implicated in a strategy of Chile as Chile presented the finance field to the last moment. One researcher of the Korea Rural Economic Institute(KREI) said “In the past agriculture-related negotiation, some countries obtained the actual benefits to the last moment after doing ‘negotiation the other issues by hiding the actual interests.” Some economic organizations are suspicious saying “The Ministry of Foreign Affairs and Trade has been attached to making the signature and taking a picture over acquiring the nation’s actual benefits.”

▽Belated Action of Ministry of Finance and Economy(MOFE) 〓 There are also problems on the attitude of MOFE in spite of not taking the negotiation representation.

The stubborn attitude of MOFE on the finance and service field of Chile doesn’t have only negative aspects. MOFE official emphasized, “The finance section must be involved for FTA negotiation with other countries such as China.”

However, MOFE has never presented the importance of finance section to MOFAT up to now. MOFAT officials complained after failing in the sixth negotiation, “If that is such an important problem, how come MOFE hasn’t taken any action during 4 years of the negotiation period?

MOFE said that it didn’t have enough information about Chile. Also, it didn`t expect that Chile rejected the finance section because it made a concession to many fields. In DL600 proposed by Chile to exclude from the negotiation items, MOFE didn`t know what DL600 is.

Ja-Ryong Koo Kwang-Am Cheon bonhong@donga.com iam@donga.com