MOCIE Minister's US IR Tour

Minister Chung takes up FTA, visa exemption, Gaeseibg Industrial Complex with U.S. leaders

Commerce, Industry and Energy Minister Chung Sye-kyun toured the United States on June 25-29 for investors relations briefing sessions to attract investment from the U.S. business community and met with key U.S. government as well as business leaders to discuss matters of mutual concern. Chairman Lee Yong-deuk of the Federation of Korea Trade Union joined the minister on the tour as the first labor union leader to accompany the Korean investment promotion mission abroad.
The delegation held investor relations sessions in New York and San Francisco, in addition to visiting Washington to meet with important U.S. government figures as well as Congressional leaders. Minister Chung had a meeting with U.S. Commerce Secretary Carlos Gutierrez for discussions on pending issues in bilateral relations including the free trade agreement and the Gaeseibg Industrial Complex in North Korea. He also explained that Korea does not discriminate on the use of foreign capital to placate the misunderstanding brewing over the Lone Star case in the United States. The minister also pitched for the exemption of U.S. visas for Korean visitors to the U.S. The minister has succeeded in winning the support from U.S. leaders he met with many of them becoming sympathetic with the minister's appeal for the need to simplify the visa procedures for Korean visitors.
The MOCIE minister called on such U.S. leaders as Senator Chuck Hagel, Energy Secretary S. Bodman, Congressman Charles Rangel and Chairman John Engler of the Manufacturers Association of America and stressed the need for the exemption of entry visas for Korean visitors to the U.S. totaling 1 million a year. He said the move will help the U.S. in that Koreans will improve their image of the U.S., and help reach an early conclusion of a FTA with Korea.
Many U.S. leaders he met expressed sympathy for his appeal.
Chairman John Engler said he was surprised that so many Korean visitors had to wait a month to obtain visas to the U.S. He promised that he will meet with Congressional leaders to change the situation for the sake of Korean visitors, especially, businessmen.
Minister Chung also told the U.S. leaders that the North Korean industrial complex, which is being run with the mix of capital and material from the South and workforce from the North, is basically an assembly complex designed for the North Koreans to learn how a market economy works. It is also a symbol for the settlement of peace between the divided Koreas, playing a big role for peace in the Northeast Asia region and it needs the understanding and cooperation from the U.S., he said, in the way of explaining why it needs special treatment.
The U.S. leaders responded that the misunderstanding on the complex stemmed from insufficient explanation on the nature of the complex that it is for assembly plants and the minister's appeal has given them an opportunity to narrow the differences.
Chung also discussed with Commerce Secretary Carlos Gutierrez and Energy Secretary S. Bodman the FTA, technology cooperation for new renewable energy and other economic issues that are jointly held between the two allies.
In the first Korea-U.S. commerce ministers'meeting in four years since the last one in 2002, the minister stressed that the FTA should realize balanced benefits for both countries and the differences should be settled under mutual understanding.
He told Gutierrez that the Gaeseibg Industrial Complex is a key factor for the liberalization of North Korea and the recognition of the product origin on products made in the complex is based on the QIZ of Israel that the U.S. recognized and Singapore's offshore assembly method, benefiting both countries involved. Chung said Korea has been taking progressive moves for the FTA negotiations to make progress. He pointed out the screen quota reduction, the resumption of U.S. beef imports in Korea, and the relaxation of tariff rates on imported foreign cars, among others, and requested the U.S. should take reciprocal steps, too, in response in areas like visa exemptions, the Gaeseibg Industrial Complex, and trade, among others.
Secretary Gutierrez said the FTA with Korea is the biggest FTA since the NAFTA and the U.S. wants it to be balanced like Korea wants it to be. He said he understands Korea's position and the two countries should work together.
Secretary Gutierrez stressed that the U.S. textile industry is concerned about textile products, appealing for understanding from the Korean side. The ministers agreed that a special consideration and cooperation would be needed to solve sensitive issues.
Senator M. Baucus and Congressman J. McCrary both pledged their support for the settlement of visa problems for Korean visitors after listening to Minister Chung's explanation.
During the meeting with Energy Secretary Bodman, Chung discussed high oil prices and measures against it. They agreed to cooperate on the technology in the area of new renewable energy and also agreed to conduct joint R&D programs at the CSLF, an international energy technology cooperation chain and IPEH, an international partnership for hydrogen economy. The two ministers agreed to make formal a joint project for the development of the gasified coal power generation technology.
MOCIE Minister Chung made a speech at the "Industrial Technology Cooperation Forum"hosted by the U.S. Chamber of Commerce in Washington. He pointed to the areas of cooperation between Korean and U.S. business firms through strategic technology tie-ups and samples of technology innovations made by Korean firms. He called for the need for the expansion of investment in the new areas of the Korean market to be opened wider based on the FTA with the U.S. like IT and BT businesses. He called on the U.S. business community to lend their support to the visa exemption issue for Korean businessmen and the Gaeseibg Industrial Complex.
Attending the meeting included U.S. government officials from the Commerce, Energy departments and USTR. Representatives of U.S. companies with operations in Korea including Johnson and Johnson, Citigroup, AIG, 3M'about 150 altogether, all from the Fortune 500 company list.
Minister Chung also met with the U.S, media. He stressed to the media the importance of the Gaeseibg Industrial Complex as a key to peace on the Korean Peninsula. It has 7,000 North Koreans working in the complex, which is likely to expand to 300,000 when the park's last stages are completed. Altogether, some 1 million North Koreans including family members of the workers will benefit from the industrial park. Chung stressed that South Korea would be able to persuade the North to come to the six party talks and give up its nuclear ambitions through the successful operation of the industrial park. Chung thinks that dialogue is the best way for the North rejoin the six party talks, rather than using pressure and isolation.
Bloomberg Wire Service said the U.S. would be able to increase its exports to Korea by two thirds and Korea would be able to expand its U.S. exports by 20 percent through the FTA. He met the media journalists on June 28 in New York to discuss mutual topics between both countries.
Excerpts from the interview said that Minister Chung will try to persuade the U.S. the crucial nature of the Gaeseibg Industrial Complex for creating peace on the Korean Peninsula. The report said Korea and the U.S. began negotiations for a $72 billion trade accord, which is being complicated by South Korea's involvement in the 25-acre Gaeseibg manufacturing park. Chung defended the project, saying products made there will create as many as 1 million capitalists in North Korea, a communist nation long isolated from the rest of the world.
The report noted that the FTA will boost U.S. exports to South Korea by $19 billion and add $20 billion to the U.S. economy, quoting the U.S. International Trade Commission data. Korea will see a $10 billion jump in its exports to the U.S. It said South Korea is the 10th largest economy in the world with gross domestic product exceeding $801 billion last year. nw

(clockwise) MOCIE Minister Chung Sye-kyun is in a meeting with U.S. Commerce Secretary Carlos Gutierrez, (facing Chung) in Washington on a leg of his U.S. tour June 25-29; Minister Chung holds the MOU signed with calWest Co. to invest $120 million in the construction of industrial infrastructure in Korea June 29; Minister Chung and those who helped him in the investor relations session in New York June 28, including President Tami Overby of the American Chamber of Commerce in Korea, Chairman Lee Yong-deuk of the Federation of Korean Trade Union and KITA Vice Chairman Yoo Chung-mu.