South Korea Free Trade Agreement / Who is the winner here?

[jaysoon17]

http://www.businessweek.com/news/2011-11-22/u-s-south-korea-free-trade-deal-ratified-in-seoul-amid-protest.html

Nobody knows the exact details in this agreement, but on the surface, I think that South Korea wins here. I don't know why there are so many protests against this agreement. Maybe there is something in the agreement I don't know about. South Korea gets cheaper beef and prevents Korean beef companies from ripping people off for overly priced meat. South Korea will also get a boost in the auto-industry since a lot of Americans will go for cheaper cars. America will attempt to sell overpriced cars to Koreans who make their own cars. Who do you think will win in the end? America or South Korea?

[sejongthefabulous]

FTA agreements are a little more complicated than your comment has them out to be. Both countries will win and lose in certain areas. Overall they will both gain. Korea already is much more reliant on US trade than US is on Korean trade. America is already a winner in my books because they haven't had massive riots over the issue making them look silly to the world. Also, they aren't an export economy, so they will always have leverage in trade agreements.
How about the Korean beef farmers?
As for cars, Americans are already learning to make cheaper cars and Korea isn't the only competitor in this area. Korea already sells a lot of cars to America; their market share will increase, but America has more to gain here. America has more 'luxury' cars than Korea.

[fudoose]

Korean beef isn't a rip off.. beef is expensive. American beef is just intensively farmed, of horrible quality and sold at an unrealistic price that leads to unscrupulous "farmers" cutting corners. People would still buy the rubbish meat because its cheaper, that's human nature, but it would ruin traditional farming industries here. Plus think of all the unnecessary food miles.

[unknownx]

Korean beef isn't a rip off.. beef is expensive. American beef is just intensively farmed, of horrible quality and sold at an unrealistic price that leads to unscrupulous "farmers" cutting corners. People would still buy the rubbish meat because its cheaper, that's human nature, but it would ruin traditional farming industries here. Plus think of all the unnecessary food miles.

I think you've been here too long. Stop listening to propaganda regarding American beef from those idiots in the media. I'm gonna take a wild guess and say you were at the protests with those farmers this week....

[confusedsafferinkorea]

Beef here, American or Korean is totally overpriced. I couldn't believe how expensive meat is here and the quality is appalling. Wish I could get some good old South African beef.

[DWAEDGIMORIGUKBAP]

Korean beef isn't a rip off.. beef is expensive. American beef is just intensively farmed, of horrible quality and sold at an unrealistic price that leads to unscrupulous "farmers" cutting corners. People would still buy the rubbish meat because its cheaper, that's human nature, but it would ruin traditional farming industries here. Plus think of all the unnecessary food miles.

I think you've been here too long. Stop listening to propaganda regarding American beef from those idiots in the media. I'm gonna take a wild guess and say you were at the protests with those farmers this week....

Frankly Korean beef blows Uk and USA beef out of the water.

A sirloin of US at emrt will be a third of the price of hanwoo, but like it's cousin in my home country, will be stringy, unmarbled and bland tasting, needing lots of seasoning, be full of red dye etc, whereas a hanwoo sirloin you can just cook by itself no seasoning and it will taste awesome.

Huge differences imho and well worth the extra, if you can afford it.

[fudoose]

I think you've been here too long. Stop listening to propaganda regarding American beef from those idiots in the media. I'm gonna take a wild guess and say you were at the protests with those farmers this week....
[/quote]

Propoganda!?  Come on.. the beef they chuck over here from America is beyond piss poor, I think Korean beef is really good but it is reassuringly expensive.. and obviously I was at the protests.. in my wellies.

[jaysoon17]

I don't think that the United States will come out the winner here. I don't think the SKFTA will end up being a fair trade either. The United States fails in a lot of the trade agreements it sets up. Look at the trade deficits it has with China, Japan, Korea, Germany, and even small third world countries like Mexico and The Philippines. Korean cars versus American beef and F.o.r.d (Fix Or Repair Daily) and GM  (General Maintenance)? South Korea looks like they are going to win in this deal, but ironically, so many are protesting it.

As for luxury, I'm convinced that a free trade agreement would be damaging for Korea if they did free trade for something like electronics, the movie industry or clothes, because the people are already willing to pay the difference for these small items. But a car takes years to save up for and tons of consideration before making a purchase. Koreans are practical when it comes to cars since it is such a large investment.

[Yu_Bumsuk]

Korean beef isn't a rip off.. beef is expensive. American beef is just intensively farmed, of horrible quality and sold at an unrealistic price that leads to unscrupulous "farmers" cutting corners. People would still buy the rubbish meat because its cheaper, that's human nature, but it would ruin traditional farming industries here. Plus think of all the unnecessary food miles.

I think you've been here too long. Stop listening to propaganda regarding American beef from those idiots in the media. I'm gonna take a wild guess and say you were at the protests with those farmers this week....

American beef is cheaper mainly because America has millions of acres of land that's suitable for grazing and little else. Korea doesn't. On the other hand, Korea can produce better digital equipment for a lower cost. Thus, by trading, we can both have more of each. It's really not that hard to figure out.

[Stephensalz]

Don't think of free trade agreements simply by who imports/exports more.  Making free trade agreements lowers the cost of living in the country.  If it didn't, they wouldn't import those items. 

Although the US may ship less goods to Costa Rica than they send back doesn't make it a bad agreement.  In this situation, bananas shipped are now cheaper than they were before the Costa Rican FTA, which lowers the cost of living in the US. It also creates more jobs in lower economies, helping those places.  Also, since the United States has many multi-national corps, the US companies will get the profits in many instances.  (for example, Chiquita gets the profits, which they in turn spend in the US) 

So, the United States gets lower costs of goods, sometimes gets the profits returned, while the other country often gets more and better jobs. 

You can't read any of these effects from import/export ratios, making it a flawed measure.

In reality, the perfect economic scenario for trade has each region specialized in what they can do the cheapest, and then shipping it throughout the world.  Of course, heavier items are better to be made locally because the shipping costs are way higher. 

IMO, it's impossible to know who wins most free trade agreements, but governments try making them because they make the world a better place.  And I am happy because soon I will be able to buy bratwurst (made in the US) for cheaper!

[Stephensalz]

IMO, it's impossible to know who wins most free trade agreements, but governments try making them because they make the world a better place.  And I am happy because soon I will be able to buy bratwurst (made in the US) for cheaper!

Your analysis is completely correct on a theoretical level. Probably even in practice to a certain extent. However this is not why govts enact free trade agreements.

Sorry.  I just killed a kitten.  Of course there are no absolutes.  And there is still a level of economic imperialism, under-pricing of resources, etc.  For the most part though, for the reasons that I stated above, FTA's benefit a country, as well as the other country.  People a lot smarter than me can explain the reasons, as I am giving a watered-down, people who didn't go to business school can understand assessment.  What other reasons would you point out?

[jaysoon17]

In reality, the perfect economic scenario for trade has each region specialized in what they can do the cheapest, and then shipping it throughout the world.  Of course, heavier items are better to be made locally because the shipping costs are way higher. 

I'm not sure if this perfect scenario is possible in today's global economy. You can apply it to things like fruit that aren't grown in ones country and for commodities, but I don't think it will work manufacturing industries such as textiles or the auto-industry.

Free trade has not done really good things for the United States. I can't see it no matter what the bottom line of a multinational company is. Yes, food is cheap, and that is good for people with good jobs, but jobs left the country in in huge numbers. NAFTA has been a disaster for working people. I agree with Ross Perot, the one who was against free trade during the Clinton era, who was in favor of fair trade rather than free trade. The trade deficits is an indicator, but the number of jobs that left the country is another indicator and reflects how bad free trade agreements has been for the United States.

I don't think the SKFTA will be as bad as NAFTA, but I still think Korea will win in the end. That's a good thing for us since we live here in Korea though. The Korean beef industry will take a hit, but the auto industry is going to gain along with Korean financial companies.

[marsavalanche]

US beef better than Korean?  Yes if youre a dog and cant taste the difference I guess.

Blatant giveaway on who has eaten beef in the US and who hasn't.

Japanese > US > Aus > The rats from that island from Survivor season 1 > Korean beef

[unknownx]

US beef better than Korean?  Yes if youre a dog and cant taste the difference I guess.

Blatant giveaway on who has eaten beef in the US and who hasn't.

Japanese > US > Aus > The rats from that island from Survivor season 1 > Korean beef

Yes, Japanese beef is the best. Eating it will definitely make you glow in the dark these days.

[Yu_Bumsuk]

US beef better than Korean?  Yes if youre a dog and cant taste the difference I guess.

Blatant giveaway on who has eaten beef in the US and who hasn't.

Japanese > US > Aus > The rats from that island from Survivor season 1 > Korean beef

There are, and always have been, two very different grades of beef in Korea. For commoners, traditionally cattle were only draught animals and when they died, the meat was like car tires. This is why recipes called for it to be sliced very thinly and for it to be boiled to hell. This is the kind of beef you'll find in places like school cafeterias. Hanoo, or beef raised for eating purposes, is more like Japanese beef than American, though the cuts can still sometimes contain far too much sinew for westerners' liking.

[DWAEDGIMORIGUKBAP]

US beef better than Korean?  Yes if youre a dog and cant taste the difference I guess.

Blatant giveaway on who has eaten beef in the US and who hasn't.

Japanese > US > Aus > The rats from that island from Survivor season 1 > Korean beef

Perhaps the beef shipped to korea from the us is poor grade?

Because I have had a 250g sirloin from emart which was american and it plain sucked.  Same with the aussie beef.

I paid way more (19k) for a 250g hanwoo sirloin and oh boy it was one of the best steaks I have ever had, flawless.  So tasty.

[andyfoggy]

Korean beef isn't a rip off.. beef is expensive. American beef is just intensively farmed, of horrible quality and sold at an unrealistic price that leads to unscrupulous "farmers" cutting corners. People would still buy the rubbish meat because its cheaper, that's human nature, but it would ruin traditional farming industries here. Plus think of all the unnecessary food miles.

sorry but this is not true

all Korean beef is intensively farmed, cows never walk on grass fields, eat only feed provided by farmers that is also intensively farmed
its a very efficient system and also employed in countries such as Israel where it is more productive for them to use fields to produce fodder/crops  than to have a few cows walking around eating grass.

Go into the country and have a look, every time you see a farm with yellow plastic sheeting on the sides of barns those are (and only are) intensively produced beef cattle barns

you might see a few cows walking around Jeju-do but these are a small exception

over the past 4 to 5 years there has been more of these beef cattle farms springing up, and in true korean style the market will soon become super saturated with Hannu and the price will drop dramatically

[Yu_Bumsuk]

Korean beef isn't a rip off.. beef is expensive. American beef is just intensively farmed, of horrible quality and sold at an unrealistic price that leads to unscrupulous "farmers" cutting corners. People would still buy the rubbish meat because its cheaper, that's human nature, but it would ruin traditional farming industries here. Plus think of all the unnecessary food miles.

sorry but this is not true

all Korean beef is intensively farmed, cows never walk on grass fields, eat only feed provided by farmers that is also intensively farmed
its a very efficient system and also employed in countries such as Israel where it is more productive for them to use fields to produce fodder/crops  than to have a few cows walking around eating grass.

Go into the country and have a look, every time you see a farm with yellow plastic sheeting on the sides of barns those are (and only are) intensively produced beef cattle barns

you might see a few cows walking around Jeju-do but these are a small exception

over the past 4 to 5 years there has been more of these beef cattle farms springing up, and in true korean style the market will soon become super saturated with Hannu and the price will drop dramatically

I wish you were right but the fact of the matter is that raising beef cattle in Korea is expensive and the only thing that can bring it down is cheaper imported feed. You can see a few cows walking around eating grass in South Gyeongsam Provice, too.

[Jeff619]

Korean beef isn't a rip off.. beef is expensive. American beef is just intensively farmed, of horrible quality and sold at an unrealistic price that leads to unscrupulous "farmers" cutting corners. People would still buy the rubbish meat because its cheaper, that's human nature, but it would ruin traditional farming industries here. Plus think of all the unnecessary food miles.

It's pretty obvious you haven't done your research.  US beef is considered some of the best in the world, behind Japan and Argentina.  Australian might be better but it really comes down to personal taste.  Personally I think Australian beef sucks but others may disagree.  One thing that can't be argued and where you sound ignorant, is that US beef is some of the safest and highest quality on the planet.  Hanwoo, on the other hand, is raised in questionable conditions and must be marinated by law.  You can eat what you want, but I find it pretty scary to eat meat that must be marinated for it's safety.  Give me US beef any day of the week.  It's cheaper, safer, and tastes better.  And actually, that is what my Korean butcher told me just last week.

[justanotherwaygook]

Korean beef isn't a rip off.. beef is expensive. American beef is just intensively farmed, of horrible quality and sold at an unrealistic price that leads to unscrupulous "farmers" cutting corners. People would still buy the rubbish meat because its cheaper, that's human nature, but it would ruin traditional farming industries here. Plus think of all the unnecessary food miles.

It's pretty obvious you haven't done your research.  US beef is considered some of the best in the world, behind Japan and Argentina.  Australian might be better but it really comes down to personal taste.  Personally I think Australian beef sucks but others may disagree.  One thing that can't be argued and where you sound ignorant, is that US beef is some of the safest and highest quality on the planet.  Hanwoo, on the other hand, is raised in questionable conditions and must be marinated by law.  You can eat what you want, but I find it pretty scary to eat meat that must be marinated for it's safety.  Give me US beef any day of the week.  It's cheaper, safer, and tastes better.  And actually, that is what my Korean butcher told me just last week.

I've had non-marinated Hanwoo multiple times.  Link please.

Hanwoo is way better than your typical supermarket meat in the US.  It has better marbling.  But the two shouldn't be compared.  Premium American beef is expensive, too.  But yes, American beef is cheaper when compared to Korean beef of similar quality.