South Korea FTA next in firing line?

Trump indicates he wants to renegotiate U.S. free trade deal with Pacific Rim ally.

By: Eric Kulisch
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Photo: RFVector / Shutterstock.com
   Is the United States poised to withdraw from a hard-fought free trade agreement with South Korea?
   President Donald Trump said in an interview with Reuters last week that he planned to just that, or try to renegotiate better terms for the United States. Trump has made similar threats with regard to the North American Free Trade Agreement because of its alleged negative impact on U.S. manufacturing, but said this week he would first attempt to renegotiate the trilateral deal with Mexico and Canada after signaling a withdrawal was imminent.
   The statements are the latest in a series of mixed signals on foreign policy, and trade in particular, that have left U.S. allies and trading partners confused about the direction of U.S. policy.
Trump told the wire service that South Korea was taking advantage of the trade deal and had built up a large trade surplus with the United States. Asked when he would announce his intention to renegotiate the pact, Trump said: “Very soon. I’m announcing it now.”
   South Korea is the United States’ sixth largest trading partner.
   Sen. Jeff Merkley, D-Ore., said on MSNBC’s “Morning Joe” show Friday morning that the timing of Trump’s comments was “strange” because South Korea is in the midst of dealing with the national security threat posed by the escalation in tensions with North Korea, which is lashing out at attempts by the United States to contain its ambitions for developing a nuclear weapons program.
   “South Korea is extraordinarily nervous and to raise issues that have been negotiated between the United States and South Korea in the past seems completely the wrong moment. . . And if they are doing so because China is asking us to do so that is something we need to deliberate a lot on because our allies anticipate that when we make a deal with them we’re going to honor it,” Merkley said.
   Trump has reportedly established a good working relationship with Chinese Premier Xi Jingping and is trying to get China to put pressure on North Korea to stop work on its nuclear program. Trump has recently stopped calling China a currency manipulator and indicated he would ignore problematic Chinese trade practices to secure China’s diplomatic cooperation.
   During the presidential campaign, Trump said he would immediately declare China a currency manipulator, which would lay the ground for enforcement measures.
   Trump told the Washington Post he was all set to initiate termination of NAFTA, but was talked out of it by Canadian Prime Minister Justin Trudeau, Mexican President Enrique Pena Nieto and centrist advisors such as Commerce Secretary Wilbur Ross, son-in-law Jared Kushner, Secretary of State Rex Tillerson and new Agriculture Secretary Sonny Perdue. They are waging a battle against Chief Strategist Stephen Bannon and National Trade Council head Peter Navarro, who tried to execute the NAFTA withdrawal order, for Trump’s heart and mind.