South Korea and the United States on Wednesday extended their talks on a pending free trade deal by at least one more day in their last-minute efforts to reach a conclusion, the South Korean embassy here said.
"The talks will resume tomorrow," the embassy said in an e-mail.
The talks were supposed to end Wednesday, but the sides could not narrow their differences over the tariffs on automobiles, South Korean officials said.
Emerging from a late evening session with U.S. Trade Representative Ron Kirk at a hotel in Columbia, Maryland, South Korean Trade Minister Kim Jong-hoon told reporters, "We still have a long road ahead."
Autos and beef have served as the major hurdles to the ratification of the Korea FTA signed in 2007 under the Bush administration.
Focus, however, has been on autos as South Korea has been adamant in its position not to discuss the possible shipments of beef from cattle older than 30 months. The Lee Myung-bak administration was almost paralyzed in
early 2008 due to weeks of street rallies after the South Korean president's decision to resume U.S. beef imports despite fears of mad cow disease.
The U.S. beef industry recognizes the sensitivity of the issue and does not want to jeopardize the rapid increase in beef exports since 2008.
"Beef was not discussed today, and we are not discussing that," Kim said.
Talks have been focused on to what extent Seoul will ease safety and environmental standards and delay the elimination of the 2.5 percent tariff on most autos and auto parts, as well as a phaseout of the 25 percent tariff
on light trucks.
The U.S. exported 5,878 automobiles to South Korea last year. South Korean auto shipments to the U.S. totalled 476,833 last year, according to
the United Auto Workers.
"South Korean negotiators are continuing to resist U.S. demands for additional concessions in the auto sector, such as a longer phaseout for a
U.S. car tariff, and are insisting that any major concessions they make would have to be offset with U.S. concessions on agriculture," online
magazine World Trade Online said, quoting unidentified sources.
Kim said earlier in the day that he was neither optimistic nor pessimistic over the prospect of striking a deal during the ongoing talks.
"It depends on further discussions," Kim told reporters.
Emerging from the morning session, Kirk, however, did not respond to questions from reporters, just saying, "No, thanks."
The first day's talks focused on autos and did not discuss beef, Kim said Tuesday, adding the talks may be extended one or two more days, or the U.S.
side may have to visit South Korea later for additional discussions.
U.S. President Barack Obama said in Seoul early last month that auto trade poses a bigger obstacle than beef and pledged to complete the talks "within weeks, not months," although he missed his earlier, self-imposed deadline of mid-November.
The Korea FTA is seen as a barometer for Obama's commitment to free trade as he has proclaimed an ambitious goal of doubling exports within five years as a means of creating jobs.
Many congressional Democrats oppose the trade deal for fear of possible job cuts amid the worst recession in decades, but free trade is seen as one of the potential areas of close cooperation between Obama and congressional Republicans, who regained control of the House in the midterm elections.
Obama has voiced his desire to present the deal to Congress early next year, as failure to do so would likely doom the FTA as Republicans vow to focus on domestic issues, including taxes and a reversal of Obama's health care reform policy, ahead of the presidential election in 2012.
Independent studies show that the FTA with South Korea would create 240,000 jobs in the U.S. and increase annual two-way trade by more than $20 billion, up from $83 billion.
The U.S. goods trade deficit with South Korea was $10.6 billion in 2009, down $2.8 billion from 2008, according to United States Trade Representative figures. The comparable figure for the first six months of this year was $421 million on $55 billion in total trade volume.
During the same period, the U.S. deficit with China was $115 billion and that with Japan and Germany $18 billion each, according to South Korean government figures.