South Korean President Roh Moo-hyun said Wednesday that a trade pact with the United States is a "challenging strategy" which South Korea can use to join the ranks of advanced countries.
"South Korea's economy has grown with the liberalization of its markets, and that means the country is now faced with severe competition in terms of the quantity and quality (of goods and services)," Roh said in an interview with Yonhap News Agency.
"We have come a long way, but we have a long way to go," he said, adding that the FTA with the U.S. "will be a challenging strategy for the country to join the group of advanced countries."
The president said that Asia's fourth-largest economy has grown following Japan's growth model, but the country is not in a position to just adopt the neighboring country's development model.
"South Korea needs to take an edge in the service sector, and the trade pact with the U.S. will help South Korea overtake Japan," Roh said. "The U.S. has the world's best service industry, and a free trade agreement (FTA) with it would help the local service industry."
South Korea launched FTA negotiations with the United States in June with the aim of signing the final agreement within a year.
The government says South Korea would benefit from the deal, but critics argue that the demerits outweigh the benefits.
Officials from South Korea and the U.S. have held two rounds of FTA talks, but failed to advance negotiations amid bickering over opening of the agriculture and textiles markets, and the country-of-origin issue for South Korean goods produced in an industrial complex in the North Korean city of Kaesong, located just north of the inter-Korean border.
The two sides are scheduled to meet again in the U.S. in early September.
South Korea is the world's 11th-largest economy and the U.S.'s seventh-biggest trading partner. Two-way trade amounted to US$72 billion last year, with South Korea posting a surplus of $16 billion, according to data from the South Korean government.
For the U.S., a deal with South Korea would be the biggest trade pact since the North American Free Trade Agreement in 1994.
Responding to criticism of significant concessions that were granted to the U.S. to facilitate FTA talks, Roh said the so-called concessions were in fact separate issues from the trade negotiations.
To start the talks, the South Korean government has already halved its quota for screening homegrown movies in local cinemas and decided to resume imports of U.S. beef after a two-year ban due to an outbreak of mad cow disease in the U.S.
"What's important is that those concessions are not subjects for the (FTA) negotiations," Roh said.
Roh also said that the government will disclose FTA-related information to the public in a way that does not undermine the two sides' confidence in each other.
"The government will reveal FTA-related information to a level that secures transparency in the wake of negotiations," Roh said.
"But key information that is crucial to the negotiations will not be on the list."
The president said he hopes the deal will be wrapped up as early as possible.
The two countries hope to complete the negotiations at an early date so that the U.S. Congress can ratify the pact before U.S. President George W. Bush's Trade Promotion Authority (TPA) expires in mid-2007.
This authority allows the Bush administration to negotiate a free trade pact without Congress having to approve amendments.
SEOUL, Aug. 9 (Yonhap)