Tough S. Korean Controls on Importing Canadian Beef

(RTT News)

South Korea's Agriculture Minister Yoo Jeong-bok said Sunday his country would impose stringent controls over beef imports from Canada even if it lifted ban on importing the item from that North American country. He told the Joong Ang daily that Seoul could not ignore the fact that Bovine Spongiform Encephalopathy (BSE), or mad-cow disease, broke out in that country (Canada) first, and his ministry was considering imposing tougher rules on importing Canadian beef than American beef.

He said discussions were on to formulate actions in case BSE broke out again, adding that his Ministry was reviewing several options, including expanding the scope of banned beef parts. Read more here.

EU to Ratify First Free Trade Deal with Asian Partner

(New York Times – Stephen Castle)

The European Union agreed Thursday to sign a sweeping new free trade agreement with South Korea – its first with an Asian trade partner – after Italy removed objections that had threatened to block the deal.

Politicians and officials welcomed the announcement as an important signal for free trade and proof that protectionist pressures are being resisted, despite the uncertainty in the global economy.

“This the first generation of bilateral trade agreements which will bind Europe and Asia together in an ever-closer economic bond,” said Steven Vanackere, vice prime minister and foreign minister of Belgium, which holds the EU’s rotating presidency. “This is a very big step in opening markets in Asia for our companies.” Read more here.

Korea - Beef deal with Canada

(Meat Trade News Daily)

Bilateral talks between Korea and Canada to be held on 13 July this year to discuss the resumption of Canadian beef imports into Korea were unexpectedly delayed (Maeil Business Newspaper).

The Korean Ministry of Food, Agriculture, Forestry and Fisheries notified their Canadian counterpart of the delay as more time is needed to gather data in order to hold talks effectively. The Korean agricultural ministry plans to come up with a nationwide agreement, involving livestock and quarantine experts, producers and consumers before the talks take place. Read more here.

Movement Needed to Reach Free Trade Deal with South Korea

(Farmscape)

Canada’s Minister of International Trade says the Republic of Korea will need to show signs of movement on a number of issues in order to justify of resumption of negotiations aimed at achieving a free trade agreement between the two nations.

The Republic of Korea has free trade agreements in place with India, Chile, Singapore, the European free trade area and ten southeast Asian countries, agreements have been negotiated with the United States and the European Union and are awaiting ratification and negotiations are underway with eight other nations including Canada.

International Trade Minister Peter Van Loan says there has been considerable progress since negotiations began in 2005 but there are some relatively intractable issues on which we will need to see some movement by Korea… Read more here.

Korea, Canada Pledge to Work for Progress on FTA

(Chosun Ilbo)

President Lee Myung-bak and Canadian Prime Minister Stephen Harper on Monday agreed to work for progress in bilateral free trade negotiations. The two met at Cheong Wa Dae.

Korea and Canada launched free trade talks in 2005, but 13 rounds of negotiations have failed to produce an accord due to differences on issues like the resumption of beef imports from Canada. Following the summit, Harper told a press conference that the World Trade Organization is reviewing Canada’s complaint about Korea’s refusal to resume beef imports, but he and Lee discussed ways to remove roadblocks.

Lee said, “The Korean government has the principle that it will resume the imports of Canadian beef someday. There are some problems unresolved. But I think the two countries will be able to reach agreement.”

Korea halted Canadian beef imports when mad cow disease broke out in Canada in May 2003. Canada has demanded that Korea resume them, noting the world organization for animal health (OIE) ruled in May 2007 that Canada had the disease under control. It filed a suit against Korea with the WTO in April this year calling for a resumption of imports, and procedures are under way.

South Korea to Adopt Global Carbon Labelling Standard by 2011

(BusinessGreen.com)

South Korea is to adopt an international standard for carbon labelling by 2011 in a bid to have the green merits of its export goods recognised by a global criterion. The UK government-backed Carbon Trust yesterday said it is working with the environmental labelling body Korean Environmental Industry and Technology Institute (KEITI) to harmonise the country’s existing carbon footprinting scheme with its Carbon Reduction Label system.

Under the Carbon Trust system, products on store shelves display the amount of carbon dioxide emitted during their entire life cycle, from manufacture through to disposal. Manufacturers then have to commit to reduce that carbon footprint on a year-by-year basis if they want to continue to carry the label.

South Korea in February launched a KEITI-led carbon labelling program after conducting a nine-month trial. It now has 24 domestic companies producing carbon-labelled products. Read more here.

Korea-Canada Showdown Looms over Beef Imports

(The Korea Herald – Yoo Soh-jung)

The beef trade row between Korea and Canada is expected to make a showdown within this month, as the World Trade Organization dispute settlement panel is expected to be established soon in line with the Canadian government's second request.

Ottawa is expected to ask again today [Thursday] that the WTO step in to resolve the beef row with Seoul that has been persisting for six years now. This second request would follow the initial request made on July 9 by Ottawa on grounds that Seoul refuses to remove its import ban of Canadian beef. Seoul would not be able to oppose arbitration upon a second request, experts say.

Korea imposed a ban on the Canadian meat in May 2003, following the confirmation of a case of mad cow disease, or scientifically known as bovine spongiform encephalopathy. Before the ban, Korea was Canada's fourth-largest beef export market, valued at $50 million in 2002. Read more here

Canada Requests WTO Panel on South Korea’s Continuing Ban on Canadian Beef

(Minister of International Trade)

The Honourable Stockwell Day, Minister of International Trade and Minister for the Asia-Pacific Gateway, and the Honourable Gerry Ritz, Minister of Agriculture and Agri-Food and Minister for the Canadian Wheat Board, today [Thursday] announced that the Government of Canada is requesting the establishment of a World Trade Organization (WTO) dispute settlement panel on the issue of South Korea’s continuing ban on the importation of Canadian beef.

“Recent consultations with South Korea on its Canadian beef ban regrettably did not produce the desired results,” said Minister Day. “Our request today for a WTO panel demonstrates our ongoing commitment to resolving this issue and defending the interests of Canadian producers.”

“Canadian ranchers produce beef that meets the highest safety and quality standards in the world,” said Minister Ritz. “This government has made it clear to South Korea that we will defend Canadian ranchers, and I delivered that point in person during my trip to Seoul in March 2009. The international scientific community recognizes that Canadian beef is safe, and we are confident a WTO dispute panel would rule in our favour.”

Bilateral Canadian Beef Talks Fail

(JoongAng Daily – Cho Jae-eun)

Though U.S. beef is allowed back in Korean stores, its Canadian cousin is not

The feud over resuming Canadian beef imports in Korea is expected to continue to the final round as negotiations between the two countries in Geneva this week prove fruitless.

The consultation talks are one of the first steps in the World Trade Organization’s settlement procedure for disputes. This April, Canada asked the WTO to review Korea’s ban on imports of Canadian beef, calling it “unjustified” and against international trade rules.

Under WTO rules, when a complaint is filed, bilateral consultations must begin within 30 days. If, after 60 days, no agreement has been reached, the complainant may ask a dispute settlement panel to review the case and make a final ruling. Read more here.

Korea, Canada to Hold Beef Talks This Week

(Korea Times – Kim Se-jeong)

Negotiators from Korea and Canada will meet this week in Geneva for consultations on the resumption of Canadian beef imports that the government had banned. Yonhap [news agency] reported Saturday that the two parties will sit down on May 7 in Geneva for consultations on the ban. The consultation is the first step in the World Trade Organization's (WTO) settlement procedure when a dispute occurs.

On April 9, the Canadian government called on the WTO to address South Korea's “unjustified” ban on the import of its beef, six year after Korea first halted shipments.

In a press release distributed through the Canadian Embassy in Seoul, Canadian International Trade Minister Stockwell Day said, “We are disappointed to have to launch this action, as we had hoped to resolve or differences through negotiations.” Day continued, “Canada has a robust trade relationship with South Korea, so it is unfortunate that we have not been able to settle this issue and reopen South Korean markets to Canadian beef.”

If the consultations fail to resolve the dispute within 60 days after the WTO received the request, Canada may request for the establishment of a panel to hear the case. The panel, consisting of three members, will undertake a confidential review of the dispute. Statistically speaking, the dispute has a chance to be resolved in the consultation stage, as the WTO said, “in July 2005 only about 130 cases of nearly 332 cases reached the panel stage.” Read more here.

U.S. Trade Chief Says Obama Will Push Ahead on Pacts

(New York Times – Brian Knowlton)

In his first policy speech, the top United States trade official said Thursday that President Obama would work to revive global trade talks and complete three bilateral accords as part of an aggressive trade agenda.

The administration plans “a new paradigm” on trade, the trade representative, Ron Kirk, told an audience at Georgetown University. “We’re looking at everything,” he said. Rejecting fears of a turn to protectionism or a softening of support for free trade, Mr. Kirk said: “Now is not the time to turn inward. Now is not the time to be timid. Now is the time to revive global trade.”

Mr. Kirk vowed to press ahead on three bilateral trade agreements negotiated by the Bush administration. He said there was strong bipartisan support in Congress for an agreement with Panama – suggesting that its completion might come first – but that the administration was also working to advance the somewhat more controversial pacts with Colombia and South Korea.

Mr. Obama had criticized Colombia during his presidential campaign because of violence there against labor activists. But his administration has pointed to progress there since then.
On the accord with Seoul, United States auto manufacturers question whether it would adequately open South Korea’s auto market. Read more here.

Canada Takes WTO Action on South Korean Beef Ban

(Reuters – Randall Palmer)

Canada will request World Trade Organization consultations on South Korea's ban on Canadian beef imports, a formal step which could lead to stronger action, Trade Minister Stockwell Day said Thursday.

South Korea banned Canadian beef in May 2003 after bovine spongiform encephalopathy (BSE) was found in a Canadian cow, but Day said it was unjustified to continue this since Canada was categorized in 2007 as a "controlled BSE risk." […] In 2002, South Korea was Canada's fourth-largest beef export market at C$50 million ($41 million). Read more here.

Rethinking and Re-energizing the Canada-South Korea Relationship

(Asia Pacific Bulletin)

Meeting for the first time since 2002, negotiators representing Seoul and Ottawa convened last month in Vancouver to discuss a bilateral open skies agreement. No agreement was signed, although a wide-ranging deal is expected to be finalized in a second round set to take place in the New Year. Despite lingering uncertainty over a Canada-South Korea FTA, the air services talks serve as an important reminder that Canada-Korea relations are moving forward.

In a rapidly changing global order in which giants like the US, China and India have cornered Canadian attention, relations with mid-sized Asian countries are easily overlooked. In a March 2008 national opinion survey conducted by APF Canada, only 37% of Canadians saw South Korea as important or very important to Canada's prosperity, and fewer than 1% saw the country offering the greatest market potential for Canada in Asia. Only 40% supported a free-trade agreement (FTA) with Seoul compared to 41% who opposed it. When asked about the state of bilateral relations compared to two years ago, 10% saw them as better, 7% worse, 56% the same, and a significant 27% did not know. Clearly, the picture of Canada’s relationship with Korea, or what it could become, is underdeveloped and unclear. Yet now is the time that Canada should refresh and re-prioritize collaboration with countries such as South Korea. Read the complete article here (PDF).

Weakness from Within in South Korea

(Export Development Canada – Peter G. Hall)

The story is getting all too familiar: yet another economy joining the ranks of those succumbing to the slowdown that began in the large economies. Scoping the reach of the slowdown has turned a lot of attention to bellwether trading economies in the Asia-Pacific zone. In this context, recent softening in South Korea shouldn’t be surprising – is it just a rerun of the unfolding global story?

Trade plays a huge role in the South Korean economy. Exports accounted for 61% of economy-wide output in 2007, a share that has swelled in recent years from just 24% in the mid-1990s. Imports are also a large share of activity, but South Korea’s real trade surplus has surged from a deficit position in the mid-1990s to a whopping 11% of economic output in 2007. The bulk of the surge occurred in the post-2002 period, when trade chipped in half of the economy’s total growth.

Such trade-dependence sounds like a prescription for a shake-up in today’s environment. But so far, South Korea is bucking the global trend in a big way. Real export growth has risen steadily since 2005, clocking 16% annualized growth in the April-June period. Monthly exports were up 37% in July compared with a year ago, in spite of much slower activity to the US and Eurozone markets. Surging shipments to top customer China, and also Japan, Southeast Asia and the GCC region, more than made up for the weaker destinations. In sum, export activity remains robust.

Even so, trade’s overall contribution seems to be faltering. Recent import growth has also accelerated, knocking South Korea’s nominal trade balance into deficit last December, where it remained in July. Normally an indication of potentially dangerous red-hot growth in the domestic economy, this turn of events is more about high commodity prices. As a large importer of commodities, South Korea’s import tab has taken a big bite out of the export bonanza.

Oddly, South Korea’s internal economy is where the key concern lies. Domestic demand slowed to a crawl in the second quarter as plunging consumer confidence halted spending activity abruptly. Moreover, difficulties in the housing market put the brakes on investment spending. Increased government outlays were not significant enough to offset weakness in the other categories. As such, in spite of the vigorous export picture, overall growth slowed to a 3.4% annualized pace in the second quarter, down from 5% in 2007.

The mix of growth is not comforting. It has become increasingly difficult for larger economies – particularly trade-dependent ones – to dodge the bullet of slowing global growth. While the spread of weakness has been more protracted than expected, it has been persistent. And the wave now seems to be hitting Japan, China and other key South Korean customers. With the bulk of pundits now expecting world economic problems to continue in 2009, hopes for a timely, rapid reversal of the current trend are fading. In this context, South Korean exporters will find it difficult to pass on rising input costs to customers, putting the squeeze on corporate profits.

The bottom line? The current source of South Korean weakness is surprising. With export activity soon likely to feel the effects of the softer global slowdown, and no domestic economy to fall back on, South Korea’s economy is highly vulnerable to a swift change in its fortunes.

Stalled Free Trade Talks Hoping for Some Help

(Embassy – Lee Berthiaume)

Trade Minister Michael Fortier’s assertion that Canada is going bilateral has the world wondering what will really change

Diplomats from countries with which Canada has been engaged in long free trade negotiations are encouraged by Trade Minister Michael Fortier’s assertion that the collapse of the Doha round of World Trade Organization talks will see Canada become more active on bilaterals. However, while hoping the push will include greater flexibility, including a move away from demanding the same treatment as the United States, there appear to be few signs as yet that any substantial change has taken place.

Two weeks ago, Mr. Fortier was in Geneva when the Doha talks were declared dead. In a conference call with reporters, the minister declared that while multilateral trade liberalization had taken a blow, Canada would become more aggressive in pursuing bilateral deals. “In terms of opening trade corridors for our exports, we want to continue down the path of bilaterals,” he said, adding the government will be “knocking on doors around the world to create new opportunities for our farmers and exporters.”

The Conservative government had already been much more active on free trade agreements and other bilateral deals than previous governments, launching talks with Peru, Colombia, Jordan, the Dominican Republic, Panama and the Caribbean Community (CARICOM). It had even concluded negotiations with a four-member bloc of European countries, Peru and Colombia.

However, free trade talks with Singapore, South Korea and a bloc of four Central American countries – all launched by the Liberals earlier this decade – have barely moved even with the Conservatives at the helm.

While the Department of International Trade said yesterday it stands ready to conclude a “balanced agreement” with the four Central American countries, questions sent to it last week as to how the government will move ahead following the collapse of Doha and whether it will change its trade deal negotiating tactics were not answered by press time.

Canada Wants U.S.-Style Deals

Canada launched negotiations with South Korea in July 2005, and have so far seen 13 rounds come and go. The discussions have become extremely sensitive given implications for the Canadian automobile and shipbuilding industries. However, the South Koreans have also taken issue with Canada’s insistence that it get as good a deal as the Americans did last year.

Youn-Jung Kim, second secretary at the South Korean Embassy, said last week that she was encouraged by Mr. Fortier’s statements following the collapse of the Doha round, and that both countries “are very much interested in concluding a FTA.” She said another round has been planned – the last one was in March – but she was unaware of any dates. At the same time, “the official statements said that Canada will be more active with the bilateral negotiations, but I have not seen detailed orders or actions.”

Ms. Kim said the Canada-South Korea talks have reached a point where political will is essential for reaching a successful conclusion, which could be a factor with Doha gone. However, “I think it’s somewhat early to say that Canada will be more positive or too active, that they’ll make concessions.”

Canada launched free trade talks with four Central American countries – El Salvador, Guatemala, Honduras and Nicaragua – in November 2001 and 10 rounds were held until talks officially stalled in February 2004. Since then, there have been unofficial visits and meetings, but, as yet, dates for an 11th round of so-called Canada-CA4 talks have yet to be set.

Carolina Calderon, minister counsellor at the Embassy of El Salvador, said there have been tentative plans to get negotiators back together for September, and she expressed hope that Mr. Fortier’s support for completing bilateral deals will include the CA4.

Ms. Calderon said when the negotiations were launched, Canada made strong demands and was unwilling to really bend on key issues of importance to the Central American countries, like refined sugar and textiles. Part of the reason was Canada was worried any concessions made to the CA4 would also have to be given to other countries in the hemisphere through the Free Trade Area of the Americas.

By the time talks stopped, Ms. Calderon said, “we were very keen to negotiate and Canada seemed to be hesitant.”

The Central American countries turned to the United States and completed a deal in 2005 before meeting with Canadian officials to discuss relaunching talks.

“Canada comes to us and says ‘We want more or less the same treatment as you’ve given the United States’ and we said no,” Ms. Calderon said. “That’s not possible because, first of all, the United States is the main partner of Central America, main trading partner, and the relationship with the United States, I’m not saying it’s better, but we have more trade with the United States than we have with Canada.” Read the complete article.