Korean president stops by Hyundai Mobis factory to encourage workers
DETROIT ― President Lee Myung-bak and U.S. President Barack Obama on Friday visited the General Motors plant in Detroit together in a show of “economic alliance,” two days after the U.S. Congress ratified the Korea-U.S. free trade agreement.
The FTA was signed in 2007, but was met with complaints from U.S. automakers and legislators from the Detroit area, prompting the two governments to revise the trade deal late last year.
The two presidents’ trip to Detroit came on the fourth day of Lee’s five-day state visit which was timed with the U.S. Congress’ passage of the FTA Wednesday. The Korean National Assembly is yet to ratify the FTA bill.
Both nations have presidential elections next year. Obama has vowed to run for a second term in November 2012.
After speaking to the workers at the GM Orion assembly plant about the expectations for the FTA, Lee dropped by the Hyundai Mobis factory in Detroit later Friday.
Lee toured the auto parts maker’s plant and spoke to the employees about his hopes that the partnership between Hyundai Mobis and Chrysler would help boost the economic alliance between the two countries. Hyundai Mobis makes the front and rear chassis for the Chrysler Jeep in Detroit.
Calling the Detroit plant, where Korean capital is invested and local workers are hired, a model case of economic cooperation between Korea and the U.S., Lee encouraged the employees to keep up their good work.
The FTA was revised in December to let the U.S. keep its 2.5 percent tariff on Korean cars for four more years after it takes effect, rather than cut it immediately or within three years depending on engine capacity. Korea also agreed to immediately cut its tariff on U.S. auto imports from 8 percent to 4 percent, and fully eliminate the tariff in the fifth year.
In addition, Korea has raised from 6,500 to 25,000 the limit on the number of cars that each U.S. automaker can export to Korea provided they meet U.S. federal safety standards. Korea has also agreed to consider all U.S. autos to be compliant with new Korean environmental standards on fuel economy and greenhouse gas emissions, developed since the 2007 agreement, if they achieve 119 percent of the targets in these regulations.
Under the 2010 supplemental agreement, Korea has committed to add a special safeguard for motor vehicles to help the American auto industry cushion the impact from surges in Korean auto exports due to the free trade deal. Other concessions Korea has made include a delay in the elimination of a 25 percent U.S. tariff on Korean trucks and an earlier elimination of Korea’s tariff on U.S. electric cars.
In return for Korea’s accommodation of U.S. demands in the auto sector, Washington allowed Seoul to keep its tariff on U.S. pork for two more years and dropped its demand that Korea widen its market for U.S. beef imports.
By Kim So-hyun, Korea Herald correspondent (email@example.com)