President Barack Obama and U.S. Rep. Sander Levin, a Royal Oak Democrat, should be commended for their effective efforts to substantially revise the U.S.-Korea Free Trade Agreement, which Congress overwhelmingly approved Wednesday night. The UAW fully supports this trade agreement because the automotive provisions, which are very different from those negotiated by President George W. Bush in 2007, will create significantly greater market access for American auto exports and include strong, auto-specific safeguards to protect our domestic markets from potentially harmful surges of Korean automotive imports.
Unlike the 2007 negotiations with South Korea, the labor movement, and particularly the UAW, had an opportunity to be part of the 2010 discussions on strengthening the trade deal. Working with U.S. Trade Representative Ron Kirk and other members of the Obama administration, then-Ways and Means Committee Chairman Levin and top management from the auto companies, the UAW believes the new agreement will help protect current American auto jobs, contains meaningful trade law enforcement and makes stronger labor and environmental commitments.
Under the 2007 proposed agreement, almost 90% of Korea's auto exports to the U.S. would have received immediate duty-free access. Under the agreement passed this week, the 2.5% U.S. tariff on automobiles will stay in place until the fifth year after implementation of the agreement, and the 25% tariff on light trucks remains until the eighth year, when it starts to be phased out. Moreover, South Korea will immediately reduce its electric car tariffs from 8% to 4%, and will phase out the tariff by the fifth year of the agreement. The delay in tariff reductions will allow the domestic automakers time to strengthen their global competitive positions in both traditional and advanced energy efficient auto markets.
The agreement also includes standards for the protection of worker rights, including obligations for South Korea to respect core International Labor Organization labor rights and to effectively enforce labor laws designed to ensure a level playing field for American workers to compete.
Unlike China and many other Asian countries, South Korea has a robust trade-union movement that developed rapidly after the end of the military dictatorship. In fact, the UAW supported the organization of the Korean Metalworkers' Union, which now represents workers at Hyundai, Kia and the other Korean automakers. Combined with the labor provisions of the U.S.-Korea free trade agreement, our bilateral trading relationship will not be based on the exploitation of labor and the denial of trade union rights in either country.
President Obama and South Korean President Lee Myung-bak will travel to Detroit today to highlight the deal's potential economic and employment benefits to the automotive sector and the overall American economy. The UAW strongly believes that the revised agreement, along with Obama's earlier financial assistance to the auto industry during the 2009 financial crisis, will not only support the nation's economic recovery, but will improve our economic relationship with South Korea and provide UAW members with the opportunity to make products for export to Asia.
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