Speeches and Transcripts
Seoul - Washington: Where Do We Stand?
Alexander Vershbow
U.S. Ambassador to the Republic of Korea
U.S.-Korea Institute at the
Johns Hopkins University School of Advanced International Studies
Kenney Auditorium
April 24, 2007
I’m pleased and honored to be speaking at the new U.S.-Korea Institute at SAIS, and I want to thank Don Oberdorfer for the invitation. SAIS could not have picked a finer person to head this new center for Korean studies, since he literally wrote the book on the post-war history of the Korean peninsula, in addition to his legendary work as a journalist for the Washington Post. I have heard that it was the North Koreans that inspired Don to choose the weighty title of “Chairman” of USKI. I think his contributions to Americans’ understanding of Korea and Korean affairs merit the additional honorific of not only “Dear Leader,” but “Great Leader” as well.
I’d also like to thank the Korea Economic Institute and its President, Jack Pritchard. I’m here in the United States thanks to KEI’s annual sponsorship of the “Ambassadors’ Dialogue” – a cross-country roadshow in which the U.S. and Korean Ambassadors talk up the U.S.-Korean relationship, this year in Chicago, Portland, Denver, Houston, New Orleans and Atlanta. This is, as far as I know, a unique program, and it symbolizes the wide range of shared interests that unite our two countries.
I’ve been Ambassador to the Republic of Korea for a year and a half, and have come to appreciate the special relationship between the United States and Korea. Part of it is the exceptionally close ties between our peoples, grounded in the 2-million-strong Korean-American community and enhanced by the hundreds of thousands of Koreans who have studied or worked in the U.S. It’s really a myriad of interconnections, across a wide range of important and complex issues, and I am glad that USKI covers them all.
I know that the last few years in Korean-American relations have given rise to a lot of pessimistic assessments – that the alliance is allegedly on its last legs, that we face irreconcilable differences over North Korea, that we are drifting apart economically, or that Korean people are increasingly anti-American and looking more to China as their long-term partner. It’s true that our two countries have had to grapple with some very difficult issues, and that there have sometimes been heated debates. This is only natural when a relationship as dynamic as this one has been undergoing some of the most far-reaching changes in its history. But I’m pleased to be able to report to you today that the U.S.-Korean relationship today is in very good shape – and it is becoming a much more mature, healthy and balanced partnership than ever before.
FTA
One of the greatest examples of the strength of our relationship is the recently concluded Korea-U.S. Free Trade Agreement (or KORUS FTA). After ten months of negotiating rounds in both the U.S. and Korea, we successfully concluded the negotiations and informed the Congress of our intent to sign this trade agreement on April 1 at 11:40 pm – with only 20 minutes to spare before the deadline imposed by the imminent expiration of Congressional Trade Promotion Authority (TPA). The agreement must still be signed and sent to the U.S. Congress and the Korean National Assembly for ratification. But it’s hard to overstate the magnitude of change this agreement represents.
This is the largest FTA Korea has ever negotiated, and the largest FTA the United States has negotiated since NAFTA. Tariffs on virtually all manufactured goods and agricultural products traded between our two countries will be eliminated, with 94% of both sides’ industrial tariffs disappearing within the first three years after the FTA goes into effect. In addition, the FTA has chapters that address other, non-tariff barriers such as intellectual property protection, barriers to investment, service sector barriers, and technical barriers to trade, or standards.
There are areas where each side might have liked to get more from the FTA talks, but a fundamental tenet of any negotiation is that neither side gets 100% of what it wants. We couldn’t and shouldn’t let the pursuit of “perfect” be the enemy of what is, in this case, achievement of “the very, very good.”
First and foremost, the FTA will boost trade and investment in both directions. Although the two sides are starting from different baseline levels, both sides will see a significant boost in exports as the benefits in tariff elimination and removal of non-tariff barriers come through. Second, by implementing measures that will create a more hospitable environment for foreign investment, Korea should be able to attract more U.S. investors, thereby better positioning itself as a Northeast Asian hub.
For the U.S., the benefits of this agreement are indeed enormous. The agricultural tariff eliminations will lead to big gains in what is already our fifth largest agricultural export market. This agreement also finally resolves many non-tariff barriers we’ve faced in Korea. Koreans, for their part, realize they need to embrace a new model to compete with Japan and especially China. This seems to have strengthened their readiness to undertake tough reforms. Recent public polling in Korea shows 2 to 1 support for the FTA (60% in favor, 30% opposed) – even though the majority of Koreans assume (falsely) that the U.S. got a better deal. At this point, people are assuring us that ratification shouldn’t be a problem in Korea, barring unforeseen developments.
This FTA will also strengthen the U.S.-Korea partnership at a time when we face important challenges with North Korea’s nuclear ambitions and modernizing our security alliance. But frankly, this FTA must – and does – stand on its own economic merits.
By opening up our two economies to greater competition, both countries will see efficiency gains, leading to more economic growth and job creation. That is where the benefits will be somewhat greater on the Korean side, since Korea will be eliminating more inefficiencies in its economy, particularly in its highly protected agriculture and services sectors. Greater efficiency means that both economies will enhance their competitiveness.
On the subject of competitiveness, there has been a lot of media commentary recently on potential impacts of the KORUS FTA on regional and multilateral trade liberalization. Looking back at past U.S. FTAs, the United States has always pursued FTAs as a complement to, not a substitute for, our regional and our multilateral trade-opening efforts. We expect the KORUS FTA to provide impetus to further trade liberalization in the Asia-Pacific region. The U.S. fully supports APEC's ongoing trade opening efforts. Longer-term, we would like to see a Free Trade Area of the Asia-Pacific region. We also hope that the KORUS FTA can spur more rapid progress on the multilateral trade liberalization front, by demonstrating the resolve of two leading economies – in the Asia-Pacific region and in the world – to eliminate both tariff and non-tariff barriers to trade and investment.
The U.S.-ROK Security Alliance
The FTA adds a new dimension to the ROK-U.S. alliance. But our alliance is still grounded in our mutual determination to maintain peace and stability on the Korean Peninsula, and in the region. As with our economic relationship, the security alliance has been changing with the times, in keeping with changes in the security environment and the capabilities of both partners.
Change is often controversial. There are some on the far left who argue that Korea has changed so much that the time has come for the withdrawal of U.S. Forces Korea. There are others on the far right who say a nuclear North Korea is more dangerous than ever, and who fret that Alliance transformation may somehow result in a lessened U.S. commitment to the defense of South Korea. Both views are absolutely wrong.
In truth, our two great militaries are currently working closer together than ever. The process of transformation has brought forth many controversial issues, but all of these have been resolved to the two governments’ mutual satisfaction thanks to the tradition of close consultations we have established over the years. (In this regard, I should pay special tribute to Deputy Under Secretary of Defense Richard Lawless, who has guided this process for the U.S. in recent years and will, sadly, be leaving the USG in July.).
High-level U.S. and Korean security officials meet every 2-3 months to hold the Security Policy Initiative (SPI) talks to review progress made in these areas, and to work out agreements on issues that remain to be resolved. Every Autumn, our two defense chiefs and our two chairmen of the Joint Chiefs hold Military and Security Consultative meetings (the MCM and SCM) to assure that proper care is being taken to maintain this vital security alliance. That security commitment is embodied in the U.S.-ROK Mutual Defense Treaty, and will endure so long as that treaty remains in force.
Let me comment in greater detail on two alliance issues that have been in the news in recent months.
OPCON Transfer: In sharp contrast to the early days of our military alliance when South Korea received U.S. military assistance, today, South Korea’s highly capable military is taking greater responsibility for Korea’s own defense, as well as helping the citizens of Iraq and Afghanistan rebuild their war-torn lives. We believe a more balanced sharing of the burdens will make the alliance more politically sustainable in both countries for the long haul. That is why we responded positively when the South Koreans proposed that the ROK assume wartime operational control (OPCON) in the coming years.
Secretary of Defense Robert Gates and Defense Minister Kim Jang-soo met in Washington on February 23 and reached a breakthrough agreement on the transfer of wartime OPCON to the ROK on April 17, 2012. As with the transfer of peacetime OPCON back in the 1990s, we see this as the next step in the continuing evolution of the strong and trusted alliance that exists between our two countries.
Though the transfer date has been agreed to, now it is time for both militaries to work together closely to develop an effective OPCON Strategic Transfer Plan. This plan should address all the needed capabilities, planning, infrastructure and training so that there is no weakening of deterrence of North Korean aggression or other threats to peace and stability on the Korean Peninsula.
Realignment of U.S. Forces on the Korean Peninsula: At the most recent April 16 SPI talks here in Washington, agreement was reached on the return of nine additional camps to the Republic of Korea, bringing the total to 23 former USFK camps that will be returned by June 1 this year. That agreement attests to both countries’ commitment to successfully transform the U.S.-ROK Alliance. The overall realignment of U.S. Forces on the Korean peninsula to streamline operational effectiveness is a key element of this transformation.
The progress on camp returns builds on the agreement earlier this year to accelerate the relocation of U.S. forces from Yongsan Garrison in Seoul, and from other installations north of the Han River, to a new and improved, consolidated location at Camp Humphreys in Pyeongtaek. Plans for key construction projects are underway and we expect the official groundbreaking at Pyeongtaek in September.
The consolidation of U.S. bases will benefit the Korean people, who will gain access to prime real estate in the heart of Seoul. At the same time, the morale and effectiveness of U.S. service members in Korea will also improve when they are able to move into more properly-equipped facilities in the near future. This will truly be a win-win situation for both countries.
Six-Party Talks
Over the years, South Korea’s relationship with and views toward North Korea have evolved considerably. Many younger South Koreans view the North not so much as an enemy, but as a country of fellow Koreans, with the same culture and history, but down on their luck and in need of economic and humanitarian assistance. Some Koreans remain very concerned about the threat to security and stability posed by the North, but my observation is that the threat perception is lower than it used to be. However, it is my impression that most Koreans have become more sober-minded about relations with the North since last year’s missile launches and nuclear test, and across the spectrum, South Koreans stand with the rest of the international community in seeking a denuclearized North Korea.
Toward this end, South Korea joined with the United States and the other Six-Party countries in delivering a firm response to North Korea’s provocative actions of last year, their missile launches in July and nuclear test in October. The Koreans have worked closely with us in laying the basis for resuming the Six-Party Talks late last year and sending a clear message to the North that it must live up to its obligations to denuclearize.
On February 13, the parties agreed upon a series of concrete initial actions to be carried out over a 60-day period that would start the process of implementing the breakthrough agreement reached two years ago – the Joint Statement of September 19, 2005. Unfortunately, there have been some technical issues that have complicated the implementation of the February 13 agreement, and North Korea missed the April 14 deadline. Nevertheless, we and our partners expect the North Koreans to fulfill their commitment to “shut down and seal for the purpose of eventual abandonment” the nuclear reactor and reprocessing facility at Yongbyon, which has produced plutonium for several nuclear weapons, and to do so with monitoring and verification by the International Atomic Energy Agency (IAEA). Only then will the North receive the energy aid (50,000 tons of heavy fuel oil) that was promised under the February 13 agreement.
We want to restore the momentum, since there is even more work to be done in the next phase of the process: the disablement of all DPRK nuclear facilities and a complete declaration by the North of all its nuclear programs. As Ambassador Hill has said, it is our goal to accomplish all the steps envisaged in phase two before the end of this year. As the February 13 agreement states, the other parties will provide economic and energy aid equivalent to another 950,000 tons of heavy fuel oil in connection with the DPRK’s disablement of its nuclear facilities and issuance of a complete declaration. The United States is also prepared to work toward improving bilateral relations with the DPRK. But all these steps are clearly linked to performance by the North Koreans in fulfilling their obligations.
I should stress that the steps envisaged under the February 13 agreement and in phase two are only a way station toward the ultimate goal: the complete dismantlement of North Korea’s nuclear weapons and existing nuclear programs, as set forth in the September 2005 Joint Statement. It is only with complete, verifiable and irreversible denuclearization that we can agree to the full normalization of relations with the DPRK and the conclusion of a permanent peace regime on the Korean Peninsula. These are ambitious goals, but we believe that they can be achieved during 2008 if the North Koreans have the political will to do so. We stand ready to do our part if they do.
Visa Waiver Program
There is one other important issue I would like to comment on before concluding my remarks. It is the issue of providing visa-free travel for Koreans who wish to visit the United States. Last year, our Embassy in Seoul processed more than 450,000 visas, the largest number in the world, and we could break half a million this year.
I am determined to see Embassy Seoul lose the distinction of having the largest visa-issuing operation in the Foreign Service. To facilitate not only more travelers, but safer and more secure travel, I sincerely hope we can make real progress toward full Korean participation in the Visa Waiver Program. There is currently legislation pending in Congress that could allow for that and we are watching the situation very closely. A House-Senate Conference Committee is addressing the issue. We do not yet know what the committee will decide, but I am hopeful and fully supportive of Korea’s efforts to join the Visa Waiver Program.
Conclusion
There is no doubt that times are changing, and that South Korea is experiencing a very dynamic present and future. As the United States and Korea cooperate to achieve common goals – such as the denuclearization of North Korea, increased bilateral trade and investment, enhanced military cooperation, and safer and easier travel – our alliance will grow stronger, healthier and more resilient than ever before. I look forward to hearing your views and answering any questions you might have.