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Lessons of NAFTA on the proposed Korea-US FTA

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Ohio Lawmaker Says NAFTA Lessons Should Be Applied to U.S.-Korea Talks

The lessons learned from the North American Free Trade Agreement should be applied to ongoing negotiations for a U.S. -Korea free trade agreement, Rep. Betty Sutton (D-Ohio) said Feb. 27 at a congressional briefing.

Sutton blamed Ohio´s loss of 50,000 jobs on NAFTA, saying that her constituents cannot afford a similar experience with the Korea FTA.

The proposed U.S.-Korea FTA would be the second largest free trade agreement the United States has negotiated.

Heo Young-Koo, vice president of the Korean Confederation of Trade Unions, said that the U.S.-Korea FTA closely follows the NAFTA model, which he said has brought many problems to U.S. society. He pointed out that the pending Korea agreement contains the same investor-state clause as in NAFTA. This clause, he charged, greatly expands the authority of big business while infringing on the government´s ability to protect labor and environmental standards.

Heo further charged that the South Korean government has and continues to violate the rights of workers. He complained that the South Korean government has not made any effort to solicit the views of stakeholders and the Korean public in the negotiations. Also, the South Korean government has moved forward with the negotiations in a closed and secretive manner, he said.

Concerns expressed by Heo included the charges that the agreement endangers the Korean people´s access to health care and pharmaceuticals and that the agreement will make the lives of Korea´s farmers much more difficult.

Jeff Faux, moderator of the discussion and founder and former president of the Economic Policy Institute (EPI), said that the United States continues to negotiate trade agreements as if the last two decades had not taken place. Virtually all the claims of NAFTA´s proponents--including that it would stop illegal immigration--proved wrong, Faux said.

Proponents of NAFTA promised that the free trade pact among the United States, Canada, and Mexico would generate a large number of new jobs. Instead, NAFTA resulted in a net loss of about 1 million jobs, Robert Scott, EPI senior international economist, said. He suggested that the United States should rely on better models in negotiating future free trade agreements, pointing to the experience of the European Union.

Professor Carlos Salas, of El Colegio de Tlaxcala and Institute of Labor Studies in Mexico, said that large corporations were getting NAFTA´s benefits while the agreement was causing a steady loss of employment in Mexico´s agricultural sector.

Bruce Campbell, executive director, Canadian Center for Policy Alternatives, noted that parallel talks are going on between Canada and Korea on free trade as the United States negotiates its trade agreement.

(BNA Daily Report for Executives) 2/28/2007