POSTED: 1:30 a.m. HST, Jun 15, 2011
The U.S.-Korea Free Trade Agreement would eliminate tariffs and other barriers, promote economic growth and strengthen economic ties between the United States and Korea. If approved, it would be the most commercially significant free trade agreement for the U.S. in 16 years.
According to the U.S. International Trade Commission, the agreement would create as many as 70,000 new jobs for Americans and increase U.S. exports by more than $11 billion.
According to U.S. Bureau of Census data, failure by Congress to approve the agreement could cost the U.S. an estimated 345,000 jobs.
Approval of the agreement would also contribute to the sustainable economic growth of the U.S. The U.S. Chamber of Commerce estimated that elimination of Korean tariffs and tariff-rate quotas on goods alone would add $10 billion to $12 billion to annual U.S. gross domestic product and $10 billion to annual merchandise exports to Korea.
President Barack Obama's National Export Initiative aims to double the U.S. exports within the next five years as a way to support and create 2 million new jobs in the U.S. The U.S.-Korea trade deal offers the best opportunity to jump-start this initiative.
Hawaii stands to gain immensely from this landmark agreement, which would benefit the economy by creating new jobs.
All furniture exports and many manufactured goods produced in Hawaii would enter Korea duty-free.
Korean duties on major Hawaii agricultural products such as papayas and coffee would be eliminated.
In addition, the agreement would simplify and expedite customs procedures, enabling Hawaii businesses to reach Korean companies more quickly.
Korea is one of Hawaii's three largest export markets for goods. In 2009, Hawaii's exports to Korea totaled $67 million, according to the U.S. Chamber of Commerce. Korea is the fifth-largest importer of American agricultural products and the third-largest importer of Hawaii's agricultural products.
State Rep. Roy Takumi's comment in regard to Korea's currency being manipulated may be a misunderstanding ("There is no upside to Korea trade pact," Star-Advertiser, Island Voices, April 8).
The value of the Korean won is determined by market fundamentals and by supply and demand of foreign exchange.
The won attained its lowest exchange rate in April 2010, when $1 was worth 1,100 won. This was caused by unique geopolitical risk related to North Korea, not by unfair manipulation of the Korean government.
This happened when North Korea sank the South Korean navy vessel Cheonan, which resulted in elevated tensions on the Korean peninsula. It peaked one month later at 1,250 won to the dollar. The Korean won continues to show a much stronger tendency in 2011 compared to other currencies.
On behalf of the directors and members of the Hawaii Korean Chamber of Commerce, we strongly urge the U.S. Congress to pass the U.S.-Korea Free Trade Agreement.
The congressional approval and implementation of this agreement would bring much-anticipated benefits for the U.S. work force and help America maintain its leadership role in the Asia-Pacific region and beyond.