President Lee Myung-bak held talks with US President Barack Obama on June 27 on the sidelines of the G20 meeting in Totonto, Canada, with the two leaders agreeing to put back the scheduled transfer from April 17, 2012 to December 1, 2015. The decision was made at President Lee’s request in consideration of changes in the nation’s security landscape, including North Korea’s second nuclear test and the sinking of the naval ship Cheonan.
After the meeting, the two leaders called on their defense ministers to adjust the schedule of working-level discussions to the new timeline. Follow-up measures will be discussed during the ROK-US foreign and defense ministers’ meeting in July and security consultative meeting in October.
The two nations agreed in February 2007 (Roh Moo-hyun administration) that the Korean armed forces would take over wartime control from the ROK-US Combined Forces Command (CFC) and the United States Forces Korea (USFK). However, since the sinking of the Cheonan, some conservative circles and the Korean government have shown growing concerns over the plan.
In the meantime, President Obama brought up the issue of the Korea-US free trade agreement (FTA), saying he had called on trade officials to pursue working-level discussions. He also set forth a roadmap, wanting the discussions to be concluded before his planned visit to Korea in November and submission of the bill to Congress within several months afterwards. He emphasized that discussions did not mean renegotiation but an adjustment.
Nonetheless, the agreement is likely to come under fire from the oppositional parties and civic organizations in Korea. These groups believe that the government has made a half-baked decision on a national sovereignty-related issue without fully listening to public opinion, and that the situation is nothing more than a trade-off between the delay of OPCON transfer and readjustment of the FTA.
“Discussions have continued since Pyongyang’s second nuclear test last year and been accelerated by the sinking of the Cheonan. The agreement was made possible due to our strong bilateral alliance and won’t require any extra budget spending,” said Kim Sung-hwan, Senior Secretary to the President for Foreign Affairs and National Security. He added that the year 2015 was chosen to allow the Korean armed forces’ to be better prepared in terms of information gathering, tactical control, communications, precision strike ability; a plan to establish ground forces command by 2015; relocation of USFK military base; and the Korean, US and Russian presidents’ terms in office.
Trade Minister, Kim Jong-hoon said this was first time that the US leader had set a specific timeframe and expressed his intention to present a bill to Congress. The minister added that he was sure that the US does not consider the decision a revision to the deal signed in 2007, but that it is simply a readjustment needed to push it through its legislative body.
Wartime operational control refers to authority over military operations in times of wartime. Korea has delegated wartime operational control to the ROK-US CFC while it took over peacetime control in 1994. When Defense Readiness Condition (DEFCON) 3 is issued, operational control over Korean armed forces is transferred to the CFC Commander, who is also the USFK Commander, excluding authority over the Capital Defense Corps and the Second Field Army Command.
ROK-US FTAPossible Implications
With the two leaders deciding to delay the transfer of wartime operational control, concerns are mounting over the possibility of a de-facto renegotiation of the ROK-US free trade agreement. These concerns are based on the fact that the US Congress has consistently called for renegotiations in the auto and beef sectors, with the Obama administration seeming ready to address these concerns in order to push the deal through.
“USTR will be consulting closely with Congress and stakeholders before we initiate further discussions with our South Korean counterparts in order to ensure that our proposals adequately address outstanding concerns - and these consultations will continue throughout the process,” said United States Trade Representative Ron Kirk after the presidential announcement.
According to the existing text of the agreement, Korea is supposed to abolish its 8% tariff on imported cars and parts once the agreement takes effect and gradually eliminate it over the course of ten years for eco-friendly cars. Meanwhile, the U.S has agreed to abolish all import tariffs applied to cars 3,000 cc or larger, all tariffs for pickup trucks over ten years and immediately remove its 2.5% tariff on cars smaller than 3,000 cc.
When discussions begin, the U.S is expected to maintain that it should only eliminate the 2.5 % tariff when U.S cars account for a significant portion of the Korean market, a proposal which was turned down by the Korean government back in 2007. If Korea accepts the demand, tariff elimination would become a far-fetched dream given the current situation where the share of imported cars in the domestic market has dropped to the 4% range following the recent financial stress. After signing the trade deal, the Korean government ordered domestic car makers to keep their fuel efficiency above 17 kilometers per liter in an effort to protect the environment, and which is slightly higher than the 15 kilometers per liter standard in the U.S. There is also a strong likelihood of heated debate regarding imports of beef from cattle older than 30 months because the U.S is likely to request more access to the Korean market. Currently, the importation of beef over 30 months is prohibited as a result of massive candlelight demonstrations in 2008.
Despite the two authorities insisting that beef imports is a separate issue from the trade deal, it was a precondition for the U.S to ratify the free trade deal to Congress, which has persistently demanded that Korea allow the import of beef over 30 months. Furthermore, in May 2009, the U.S Senate unanimously passed a resolution urging Korea to provide full market access to U.S beef.