 I want to say thank you all for coming. Delighted to have you here. I'm especially glad that Don Manzulu could make it. He was stuck. He was on the I-95 parking lot, and was seriously delayed. But he walked in just at the right time, just when we're ready to get rolling. And I'm really grateful for that. This is an event meant to not let something die just because it's in the past. We have a bad habit here. I know this isn't a problem for Koreans, but it is a bad habit for Americans. We get done with one thing, and then we turn to the next thing, and we just stop paying any attention. And free trade agreements don't naturally produce obvious immediate results. That doesn't mean they're not the right thing to do. They're fundamentally reshaping structure, but it takes time for that to happen. And as Scott Miller, my colleague here, said, you'd have a hard time finding statistically the impact of the free trade agreement this year. I understand that, but that's not the point. The point is that it's shaping fundamentally the trajectory of two economies as we work together going forward to both parties' benefit. So this is really meant to be a chance for us to reflect more deeply on it. It's not history. It's the present, and it's our future. And we're going to try to explore that a little bit today. We have a couple of changes. Ambassador Choi had a death in his family. And so he's not able to be with us today, but I'm very glad that the economics minister Kim is here with us, and we're delighted that he could speak for the embassy. As soon as I'll turn to Don Manzulo and have him say a few words of introduction, I would like to thank our friends at Samson Electronics America for giving us the opportunity to hold this today. And I think it's part of their spirit that they want to keep this debate active and vibrant. So thank you all for coming. Delighted you're here. Don, let me turn to you, and you can get this going for real. Thank you very much. Well, are we going to have a conference on how much time we lose in America because of the parking lot on 395? It's good to see you all here this morning. It really is a celebration whenever we talk about free trade agreements. The area that I represent in Illinois when I was first elected in 1992 was confronted with the issue of NAFTA. And I had people coming to me and saying, you can't vote for this. This is going to be terrible, et cetera, et cetera. And it was actually advised by somebody long gone in leadership who said, if you're going to vote for NAFTA, vote yes, hold your nose, and don't go back to your district for three weeks. And I thought, well, that's not leadership. The purpose of a member of Congress is to go out and to actually make public policy. So we rented a, now rented, we went to the airport. There just happened to be a 737 available. I brought her into the hangar. And I brought out about 15 other vendors who would be direct beneficiaries of NAFTA for Rockford, Illinois. That was front page of the local newspaper in color. And that made people in the area that I represent start thinking about why I should vote for the NAFTA free trade agreement. And it worked. It's a matter of making public policy, of showing people how practical these free trade agreements could be. And I voted for every single free trade agreement thereafter. But it was tough on course. Former Ambassador Lita Shek came out to my district. I picked him up at the airport. And we went by the massive Chrysler facility. And he didn't say that much. And then I turned to him, I said, Mr. Ambassador, I also want you to know that I raised beef cattle. And that was an interesting conversation as we discussed two minor issues involving the United States and Korea. But eventually came together on the issue of beef cattle. And my animals are happy. They're gone now. They're probably in for a hamburger several years ago. And also the automobile industry here in the United States. But by the time a chorus came around, people began to realize that there's something good about free trade agreements. In fact, it wasn't two years, but a couple of years before when the Australian free trade agreement passed the United States. And people before who had never voted for a free trade agreement said, I think we should vote for the free trade agreement with Australia. And then chorus passed the House with a nearly two-thirds support, including votes from 59 Democrats, including Leader Pelosi, a Steny Hoyer, and Sandy Levin. And then 45 Republicans and 38 Democratic senators voted for a chorus. And so this overwhelming positive result was achieved after some mistakenly believed that a bipartisan consensus for free trade had evaporated. In fact, it was one rule that brought to the floor the free trade agreements for Panama, Colombia, and chorus. All three had separate votes, and all three passed that day. And so we can see what's going on in Congress as more and more members are beginning to realize the benefits of free trade agreements. But we cannot rest in our laurels. To show that trade works, we need more than an aggregate statistics, because they don't tell the whole story. We need to show how this agreement works at the subnational level and for small businesses. For example, my home state of Illinois has been one of the biggest beneficiaries of chorus. According to the International Trade Administration, exports from Illinois to South Korea grew by 17% between 2011 and 2012, the highest growth rate out of the top state trading partners with South Korea. I would like to take credit for that, but I don't think that's possible. Some of the top selling goods include electronic products, chemicals, machinery, and food manufacturers, items needed by a mature economy such as Korea, and they were immediately liberalized under chorus. What we're seeing now is a real emphasis on increasing bilateral trade between the United States and South Korea. A lot of it has to do with the lowering of tariffs, but a lot of it has to do with the attitude of recognizing real markets are out there. And just three weeks ago, I brought together several people in the Rockford, Illinois area, along with people from South Korea, and they sat down and came up with some great ideas as to how to make this agreement work for the little guy who cannot have his own Washington representatives, who understands the absolute necessity of increasing his selling base. And so we're exceeding really exciting opportunities now of small and medium-sized manufacturers, distributors, and producers in Korea and the United States being able to access more and more open markets. Folks, that's what free trade agreements are. That's what happens when you try to say that before you've had enough coffee. And so I welcome you here. This is a great celebration. I don't think we'll sing Happy Birthday, but it's just great to be here. And thank you for coming. Thank you very much, Congressman. My name is Victor Cha. I'm a senior advisor in the Korea Chair, as well as a professor at Georgetown University. And I, too, consider this a celebration. This agreement was originally negotiated by the Bush administration when I was in government. And we had two big agreements with Korea. One of them was the FTA. The other was the Six-Party Joint Statement. And that one did not survive. But this one certainly did. And so it's a great reason to celebrate. My role here is to introduce the Minister for Economic Affairs at the Embassy of the Republic of Korea, Minister Kim Ki-hwan. Prior to his current position, he served as Director General for Multilateral Trade in the Ministry of Foreign Affairs and Trade dealing with WTO, APEC, OECD, and G20 trade matters. He was also involved in FTA matters as Deputy Director General of the FTA Policy Bureau and was the Chief Negotiator in the Korea-Japan FTA consultations. At MoFAT, Mr. Kim has served at various overseas posts, including the embassy in Muscat, Oman, and the Korean mission in Geneva, Switzerland. He worked as a counselor at the embassies in the United Kingdom and the Russian Federation. And he also served as Director for Supporting North Korean Refugees at the Ministry of National Unification. He completed his military service as Lieutenant at the Judge Advocate General's Office and at the Fleet Command of the Korean Navy. He received his LLB from the College of Law at Seoul National University in Korea, which is the Georgetown of Korea, and graduated from the University of Cambridge in the United Kingdom with an LLM and a Diploma for International Law. So, Minister Kim, it's a pleasure to have you with us. This morning, we look forward to your opening remarks. Thank you. Thank you, Dr. Choi. I think it's Georgetown is much known in Korea than Seoul National University in Seoul. Congressman Manzullo, Dr. Henry, Ambassador Stevens, Ambassador Batya, Mr. Cha, and Mr. Miller, and ladies and gentlemen, I regret that my ambassador cannot be here today to welcome you, as he intended. He asked me, I convey his thanks, well wishes, and appreciation to KEI and CSIS for holding this wonderful event to commemorate the first anniversary of KOROS FTA. March 15th, two days from today, marked the first anniversary of implementation of KOROS FTA. During past year, Korea and the United States have put a priority on the successful implementation of KOROS FTA to help companies, workers, consumers in both countries reap the benefits of KOROS FTA. Last May, our trade ministers, Ambassador Ron Kirk and trade minister Park Tae-ho, conducted a joint committee meeting, the highest level meeting between the two countries to discuss implementation of KOROS FTA. Since then, two countries, our two countries have held more than 10 subcommittee meetings with committees in trading goods, medicine and medical devices, agricultural trade, environment, fisheries, services and environment, as well as others. We are all scheduled to have Labor Affairs Council next week, and in the coming weeks, we plan other committee meetings covering such issues, covering issues such as financial and professional services, and Kesung Industrial Complex, we call it OPZ, Outward Processing Zone. These subcommittee meetings serve as a medium for frank and fruitful consultations about the issue of mutual concern and interest. They provide productive and transparent channels and institutions to effectively address FTA related issues. Along with holding these important subcommittee meetings, our countries have also worked efficiently to manage and solve bilateral trade issues, such as automobiles and pharmaceuticals. I believe a close conversation on these very difficult issues have led real progress these days. One year time is too brief to assess the impact, the whole impact and potential of Cora-SFTA. However, based on successful implementation and encouraging trade statistics, I would say that Cora-SFTA has brought benefits, much benefits to both the United States and Korea. This clearly looks win-win to both of us. In terms of FTA beneficiary items, which enjoy tariff reduction or elimination, it's not only tariff matters, it's more than tariff, it also deals with many NTP and regulatory issues. US export, in terms of FTA beneficiary items, US exports to Korea has increased by 2.2% in the first 10 months, since the agreement took effect in March last year. In the same time period, Korea has enjoyed an 8% increase. While we are still in the midst of worldwide financial crisis, these are very positive gains. Other than beneficiary items, all figures went down show negative. So this is a common statistics facing the world trade, but nevertheless, FTA boosts trade for a beneficiary item. That is a symbol, great sign of success of FTA. Considering the potential in the US manufacturing and agricultural sectors, I believe that US will enjoy increased benefits over time. While United States has had a trade deficit in goods with Korea in 2011, it enjoyed trade surplus in services. These gains amount to $11 billion have helped offset the deficit in goods. Taking this full picture into consideration, I'm confident that core FTA is a win-win agreement for both countries and beyond. Furthermore, since 2010, total Korean investment in the United States has overtaken US investment into Korea. Currently, total Korean investment into United States amounts to 64 billions while US investment into Korea was $49 billion. As you well know, core FTA is the most comprehensive FTA with Korea has ever completed in terms of coverage. And the most ambitious in terms of scope and speed of liberalization. However, my country does not feel that our work yet complete. Korea is actively pursuing expanded FTA network on both bilateral and bilateral level. Korea will begin trilateral FTA negotiations with Japan and China. Korea has also begun bilateral FTA negotiations with China and our same negotiations with ASEAN and its three partners, six partners. While United States is engaged in negotiating the TPP, Korea is having separate negotiations of most of TPP members. Currently, US businesses have a great deal of interest in the TPP negotiations and remain curious about the prospect of Korea joining the TPP. We have no doubt that TPP will be very much complementary to the East Asian economic integration process which we are involved in seriously. We believe Korea could play a very important role in breaching CJK trilateral, DRCEP and TPP. In that context, Korea, a core FTA will make a very important building block within a larger Asia Pacific trade order. With that in mind, the new Korean government, newly inaugurated Park Geun-hye government will closely examine the possibility of joining the TPP. In addition to commemorating one year anniversary of KOROS FTA, this year also marks the 60th anniversary of Korea-US alliance. I'm very optimistic that thanks to the benefits of KOROS FTA, our alliance will continue to grow stronger and contribute peace and prosperity throughout the Asia Pacific region. Thank you for allowing me to speak today and I look forward to exciting and informative panel discussion today. Thank you. Good morning, my name is Abraham Kim and I wanna welcome you to the second half of our morning program marking the one year anniversary of KOROS implementation. As you can notice, I am not Matt Goodman, CSIS Simon Chair of Political Economy. Actually, I'm a younger and not as good looking version of Matt. All joking aside, as we speak, Matt is doing his civic duty in a jury box in a crowded courtroom somewhere in Washington DC. He's with us in spirit and wishing us, wishing he's with us here today. But we are tremendously honored to be here today to mark the one year anniversary of the implementation of KOROS FTA. In Korean culture, one year birthday is very significant event. Parents often throw a big party, what's known as DOL, the DOL birthday party where a lot of well wishers and parents and family members come together celebrating this new life and a bright future for this child. We are here for the DOL party for the KOROS FTA implementation, marking the open of a new chapter in this US-Korea alliance as well as looking forward to a positive future. But as we all know, it took tremendous energy, tears and sweat and hours of negotiation to bring about this monumental free trade agreement. And we wanted to bring together American representatives from both the public and the private sectors that were in the trenches to push this agreement forward, to reflect on how KOROS FTA came about, its significance, its future, and perhaps sharing a few war stories along the way. I'd like to introduce our three panelists, and I trust that all of you have a detailed bio in front of you, but I'll highlight a few things about our speakers today. First, I want to introduce Karan Bhatia. Currently, he's the vice president and senior counsel of Global Government Affairs and Policy for General Electric. Prior to joining GE, he held many senior government positions, including most significantly to our discussion today, the role as deputy US trade representative and the lead negotiator during the critical negotiation years of the KOROS FTA until it was signed in June, 2007. In addition, he led a distinguished career in the Department of Transportation and the Department of Commerce. Next is Ambassador Kathy Stevens. Currently, she's the Georgetown University's Institute of Study of Diplomacy Senior Department of State Associate. She most recently served as the acting undersecretary for Public Diplomacy and Public Affairs, and was the US ambassador to the Republic of Korea from 2008 to 2011. And prior to becoming the US ambassador to Korea, she led a long distinguished career, including being the principal deputy assistant secretary of state in the Bureau of East Asian and Pacific Affairs from 2005 to 2007. And then finally, Scott Miller. Currently, he's a senior advisor and holds the William Scholl Chair in International Business at CSIS. But from 1997 to 2012, he served as a director of global trade policy at Procter & Gamble. Mr. Miller had led many campaigns promoting US free trade agreements and advising public and private sectors on international trade and investment policies, including being a liaison for the USTR Advisory Committee on Trade Policy and Negotiation and the State Department's Advisory Committee on International Economic Policy. So welcome. Before I get started, I also had a note from our tech-savvy communication crew that this is also being streamed. And for those of you in the virtual world, if you like to make comments or ask questions, you can use Twitter and use hashtag Chorus Anniversary. That's hashtag Chorus Anniversary to send in your questions for later on. Let's get started. Karan, let's start with you. As the former negotiator of the course, FTA, please provide for us some context. Please tell us how the US Korea Free Trade Agreement came about and why did US choose South Korea as a partner to negotiate a free trade agreement? Great, well, thanks very much. Thanks for convening this discussion today. I mean, to step back just for a moment, you were in a period of time, this was sort of the mid-2000s where the United States was pushing forward a very aggressive trade liberalization agenda on a variety of different fronts. So you had multilateral trade negotiations ongoing in the Doha Round. You had a number of bilateral initiatives underway, mostly, I would say, in Latin America and in some extent the Middle East as well. So we had pushed forward FTAs with Peru, with Columbia, with Panama, and similarly Oman, Bahrain, and so forth. And those were moving along. And it was clear that those were important agreements, but they were not agreements that were with markets that had huge economic potential. Korea came onto the radar screen actually before I joined USTR. By the time I joined, some of the preliminary discussions were already underway, but it had, I think, had originally sort of come up in conversations with the previous US trade representative, Bob Zelik, when I joined, Rob Portman had just come on board as trade representative, between him and then trade minister, Hyun Jo Kim. And it was, I think from the United States, a very appealing candidate for a couple of reasons. First of all, it was a great ally of the United States that was clear political connectivity there, point one. Point two, it was a country that was a much more substantial economic partner than the other ones. And I think there was a real appetite in the United States, certainly in the business community, but also I think in sort of government to see whether this model of a very ambitious bilateral FDA could be deployed in a big market or with a big trading partner like Korea. So there was a lot of interest in it from that perspective. And of course, having one with an Asian partner was of particular value as well to create sort of greater geographical balance. But I think probably the most important thing in all honesty was we believed we could do it. We believed that Korea was in a position and had a political commitment to doing the tough things that would need to be done. And I think that probably more so than anything else was what ultimately moved us over the line. There's tremendous, you take a big risk every time you launch an FDA, regardless of who it's with, because so much gets caught up into that negotiation. And you put a lot of not just effort and resources, but in fact sort of the credibility of the relationship into it. And so we approached that as long as, well as other FDA negotiations, very seriously. But the feeling was that Korea sort of in its own mind was ready to undertake the kinds of reforms that were going to be needed. And that the FDA was really going to be a vehicle that more than anything else. I mean certainly there'd be big bilateral benefits on both sides, but in some ways it was going to be a vehicle that would allow Korea and enable Korea to make those changes. And so that I think is at the end of the day probably the most important thing. Very finally I would just add, we had a president when we were launching, President Bush, who just felt very passionately about free trade. He just was uniformly supportive of these kinds of initiatives. So I think that also frankly nudged us into the category of sort of saying, look the boss is going to be supportive. The boss is going to like this and that got us in a good place as well. So it sounds like there was tremendous excitement within the government about the possibilities and the future of not only improving trade, but also the future of this relationship where it can go. How about the business sector? Sure. Scott, you worked a lot during this period, particularly as working for Proctor and Gamble. What was the business sector's attitude? Sure. Well, thank you. And it's interesting to reflect on the Korean tradition of the first birthday. I have two daughters and I remember their first birthdays. I had my long-term memory isn't quite that bad yet. But what I remember about them mostly is that they didn't have a clue what was going on. And when we served them cake, it got pretty messy. So that's sort of the situation we're in looking at this agreement year after. But I make that point because for both my daughters, by the time they were 10, you could see what kind of people they were becoming. And I'd like to start with a tenure perspective for a couple of reasons first, because business looks in the long-term, okay? Commercial operations and entry into markets is done with a very long-term horizon. I worked for 34 years for Proctor and Gamble. Our oldest operation in Asia was the Philippines, which was established in 1930. So there's a very long time horizon. You're doing this for keeps. The second thing, business is focused on the fundamentals. The one-year change in tariff rates is interesting. But more important are the underlying dynamics of the market. So, you know, B&G was in the Pampers business, still is in the Pampers business. So the number of babies actually matters a lot. It probably matters more than the tariff on Pampers. Okay? So there are a lot of those fundamentals that are part of decision-making that now what world does a free trade agreement have? Free trade agreements are basically an indicator of economic reform. Free trade agreements change the trajectory of market openness and the rules of operation. And they change it over time, but they change it usually in a very positive direction for business. So most of the interest with Korea came from the fact that it's a big trading partner. It's a big economy. It had some very large shares of certain consumer products. But more importantly, it was a signal of economic reform. Now, I mentioned 10 years. 2003 is an interesting point to reflect versus 2013. Because in 2003, the US-Korea trading relationship was about $60 billion in goods, industrial goods and agriculture. The trade relationship was actually declining at that point. Because that was the moment that China was rising as a point of final assembly for a lot of products. So from a customs classification standpoint, trade with China where the US was rising, trade with the US and Korea was declining modestly. So there were some questions being raised. But also, despite that $60 billion trading relationship for the US companies who were doing business in Korea, the question really on business's mind was, is this really worth the effort? I mean, quite seriously. Look, there are some big markets. But the growth rates in the rest of South Asia were higher than Korea. So it didn't stand up well versus competition. It was a very difficult market to do business in. There were a lot of phone or foreign ownership restrictions. For instance, the second largest insurance market in Asia and yet foreign ownership of insurance companies was prohibited, same in banking. There were also some problems with even Greenfield investments and being able to make investments in Korea was much more difficult than it needed to be much less transparent. In addition, there were some problems in that a decade ago problems with things like accounting standards. So if you were looking for a local partner, you weren't really sure what you were buying. But there were a whole lot of uncertainty that was part of that relationship. And given Korea's position versus the rest of East Asia, I think there were some marginal losses for Korea at that point in time just because there was some suspicion that does this deal worth it? Is this a country where we ought to invest versus some of the other options at the time, like Vietnam? Bigger population, younger population, more rapid growth rates, surprising openness given the overall communist government, but a lot of traders. So very interesting dynamic. Now, the other thing that happened in 2003, and the reason I started there, is that is when Korea laid out the FDA roadmap. And this was the clearest signal to those of us in commerce in the region. But Korea was serious about opening up to its markets, about reforming its internal market and getting the disciplines in place so you could eventually see your way clear to overcoming the tariff barriers more importantly than non-tariff barriers. So this was a very attractive market, remains a very attractive market. And the trading relationship, the fundamentals of why you want to trade agreement with Korea are still very good. Market access components, look, the US average MFN tariff is about 3.5%. Korea's average MFN tariff is about 17.5% or 17% when we started the negotiations. So that looked like a nice win for some very competitive American industries. There was good complementarity in terms of agriculture, Korea being a net agriculture importer, but the behind the border issues had a chance of being resolved in an FDA. And this was the really difficult part. Korea is the second largest cosmetics market, third largest cosmetics market in the world. US, Japan, Korea. Read them and weep, bigger than the frauds. It's pretty amazing. It's a great place to be in the cosmetics business if you're a Korean company. If you are a foreign enterprise or operating on an import basis, it's a very difficult place to get a hold of what's a very large market, large by global standards. So a number of these behind the border issues looked like they were going to get resolved. So the business community was broadly supportive for those reasons. Big market, chance to turn around the trends, complementarity, and getting at the behind the border issues. Great. Kathy, you were ambassador during 2008 to 2011. You must have seen, in particular, the broader potential strategic significance of the KORUS FTA once it was implemented. How did you see the importance of the KORUS FTA from your perspective? Well, thank you, Avin. Thanks to CSIS and KEI for bringing us together for the first birthday party. As you say, we're only one year into implementation of the agreement. And so I think we still need to discuss and have to wait and see and also work to fully realize the potential of this agreement. But I think it's not too early to say that our ability to negotiate, ratify, and implement this agreement has taken already the US career relationship to a new level. I know it's a bit of a cliche. And sometimes when we use it, we think, what do we mean? But I think it's clear that our ability to do this is a very special thing. It wasn't easy. And that's why actually I wanted to say a word about the process. Because that's what I witnessed not only in Korea from 2008 to 2011, but watching Korea and his colleagues on the Korean side work so hard in the negotiation leading up to it. And one of the things that I think makes this agreement so powerful in, if you like, a strategic sense in terms of the overall relationship is that it was started, the negotiations were started by different parties, different administrations, in both capitals. With President Noh Min-hyun in power and in Korea, President Bush here in the United States, we saw the negotiations completed under that administration, a global financial crisis of historic dimension. I'm not going precisely in a chronological order here. Change of power in Korea. Change of power in the United States. And then taking up of it again. And finally, ratification implementation. I know that there were probably no doubters on this diaspora in the room. But it was not hard to find people, both in Korea and the US, who said whether it was in 2008 or 2009 or even 2010, that maybe time had passed us by. But it hadn't. And I think that was a sign that people understood that this had broad strategic importance in addition to its clear economic potential. And that indeed it was too important to fail. And it didn't. And the fact that it was ratified was such strong bipartisan support after fierce debate, both in political circles and at the popular level. After that strong debate that it was ratified with a bipartisan agreement, I think underpins the point that the US-Korea relationship really is more resilient, enjoys broader support than ever, and is underpinned by this FDA. I just came back last night from a week in London. And if you tell people anywhere in the world, but if you go to Europe that you've spent some time in Korea, I mean, what's in the headlines today, as Victor suggested? Well, it's North Korea. But do you know what I was asked about? What about the possibilities of the US-EU free trade agreement? And why would they ask me that? Because of the Korea connection. I think the other strategic importance, if you like, of this agreement, even beyond its economic importance, is that it has positioned the US and the Republic of Korea and the Republic of Korea by virtue of its efforts on other free trade agreements as well as the countries that even in very challenging political and economic times understands that we need to keep taking some risks. We need to keep moving forward. That the status quo is not an option. And I think it's provided catalyst clearly in this country. And I think that's what we're seeing with both where I have a TPP, President Obama's initiative on TPP and US-EU, but also on Asia. I wanted to ask all of you to take a broader perspective. Now that we are almost five years after the signing and one year after the implementation, just looking back, were there any surprises of how the course FTA materialized and where we are today? Were there things that you just completely didn't think you would go this direction, but it did. And you're pleasantly surprised or maybe a little bit concerned. Is there are there anything that sticks out in your mind? Or maybe some memories of this experience? Well, you know, it was two straight years of surprises. You know what I mean? I don't mean that. I mean, you enter into an FTA and it's a learning process as you go through it. You just don't know what are going to become the big issues along the way. I mean, you have some feeling for them. But issues emerge, simply because they've always been there and rise to the surface. And some of their external events that happened that came in and you have to deal with them in the course of the negotiation. I mean, beef was one that in some ways falls into both. We knew that issues around US exports of beef was going to be very sensitive and a very hard issue. And then along the way of the negotiation, there were a number of twists and turns in that negotiation having to do with shipments of beef that were found to be problematic and so forth. And then you deal with them. I mean, they become crisis du jour and you try and make your way through them. I think on the US side, to be honest with you, we didn't anticipate that there necessarily that was going to be a change in the House of Representatives in control of the House of Representatives and that that was going to yield relatively late in the process the requirement that there be a change on labor and environmental conditions. And that required a renegotiation or a codicell effectively added into the agreement. So unquestionably, there were surprises through the entire thing. I think what I would say is two things. One, Wendy Cutler, who you were kind of referred to me as the lead negotiator, the person who deserves the vast majority of the credit for the actual negotiation was Wendy, who is the assistant USTR and her team, who did just a remarkable job working with their counterparts in MoFat and Korea, who were also a fabulous team. But I used to say to Wendy, she'd come into my office and she'd say like, this one's, I don't know what we're going to do with this. I know that this one's going to, the train is sort of teetering off the tracks and I said, Wendy, this is going to happen. It's inevitable. This is inevitable. This deal is inevitable. And we joked to this point about it's inevitable. It's inevitable. But I think there was just a sense with this negotiation that it's very much as Kathy said, it was too important to fail. And so you had surprises. You'd sort of figure your way through them. The Korean side had surprises. We had surprises. But you figured your way through them point one. Point two was, even regardless of how tough the negotiations got, we maintained good dialogue. I was on the phone with the trade minister and Wendy was on the phone regularly, constantly with then person who became trade minister, Jay Kim, and that I think is really what got us through all this. I mean, there was just sort of constant regular communication and the embassies played an absolutely critical role. Kathy, Kathy's predecessor and on the US side, Ambassador Lee, particularly in that time period and his team. You know, I wouldn't characterize the surprise, but one thing I really learned, and maybe this shows my own lack of understanding, but one thing I really learned through this process is that I think in both countries and both the Republic of Korea and the United States, our respective publics, and again, going beyond the capitals, going beyond the major sort of stakeholders if you like, our respective publics are actually pretty sophisticated about trade. I went to Korea, I confessed with a mindset having lived there in the 70s and 80s and the 80s is a pretty tough decade in a lot of ways in US-Korean relations, but in trade relations as well. You know, I remember the 80s here when you know, Americans were out in the heartland destroying a Toyota cars in signs of frustration. I remember the aftermath of the 90s. So in both countries, I found first in the United States when as part of a KEI sponsored trips where I traveled with Ambassador Han Duk-Soo and my predecessor and successor have done similar things, we traveled throughout the United States. I think we're the only countries that do this, that travel as two ambassadors and we traveled around everywhere from Detroit to Montana to Kansas City and talked to groups about the overall relationship but in particular about the free trade agreement and its potential, its challenges. And I was struck in every place that there wasn't a knee-jerk opposition. There was a sense of we understand, we need trade to build our communities, to build our economies. How do we do that in the right way? And is Korea the right partner? And similarly in Korea. And again, you know, whether it was truly with farmers, I had some of the most extraordinary conversations for example with Korean farmers who grow those beautiful pears, you know, who were actually interested in the market in the United States for these pears. Not because the tariff was gonna go down very much and this is kind of Congressman Mazul's point, I think, but that perhaps there'd be a new awareness of Korea and maybe they need to position themselves, not as exporters of bulk commodities but as exporters of something really, really special and the Korean American community could help do it. Many, many examples like that. But that was, I guess I wouldn't call it a surprise but it was something that I learned to keep in mind that perhaps as if I may say, sometimes too often the case, capitals are a little behind where their publics are and I think this is what made me optimistic, I'm an eternal optimist, but optimistic that if we could sort out some of the political challenges we could, that we could make it through and optimistic about the future. I would say the other thing kind of illustrates that too and maybe it was a little bit of a surprise. I recall in October, 2011 when then President E. Myeong-bak came to the United States for a state visit and was hosted for a dinner. Sitting at the head table in the White House following the ratification in October of the free trade agreement here was the President of the United Auto Workers. What a good sign. What a good sign. I think if I could just raise one thing and understand that I was six feet 10 and I had a full head of hair when I started lobbying trade agreements, I can't feel. But this one, I think I would fault my friends and associates in Washington that this agreement didn't improve with age. We concluded it in 2007, maybe 2000, most of it in 2006, 2007, and we ratified it in 2011 and nobody got any benefits in that four years, and the world moved on. It's not a political criticism or it's not a criticism of any party because that's the reality of our politics. It passed with great ease, but there is a thing in the business world called opportunity cost, and I was personally offended that we got lapped by Europe. We concluded the agreement after Europe and they ratified it in advance of us, but that's somehow, we've got to find a way in the next time when there's one of these that is so beneficial to both parties to not take our foot off the gas for quite so long. Great, thank you very much. Let's look forward now from this point. As Mr. Manzullo mentioned referred to NAFTA, I wanted to bring NAFTA into this discussion. I think one of the lessons from NAFTA is that the political attacks against FTAs do not end with the signing and ratification of an FTA. Political perceptions and support can quickly change as we saw in regards to NAFTA in the 2008 presidential election, NAFTA became a political football and a poster child for job losses. What would you advise for pro-course FTA supporters now to do so that they don't go down the same path as NAFTA in terms of the public relations and the full implementation of this agreement? Sure. Well, one of the observations I made before we got started here is I remember year one celebration of NAFTA. It wasn't a celebration. There was the Peso Crisis in Mexico, all right? And in fact, the critics of NAFTA, Pat Buchanan, Pat Chote, Ralph Nader, the whole, the people who were opposed to NAFTA all the way along instantly blamed the Peso Crisis of 1995 on NAFTA with no real support for this fact. And in fact, if you look at the post-hoc analysis in five or six years later, what really caused the Peso Crisis was not related to NAFTA at all, but at the same time, it was a difficult time. And right, NAFTA has become the great serving bowl of discontents for globalization. I swear every time an Exxon station closes in Silver Spring, it's because of NAFTA. All right, same time. I would recommend a couple of things for the U.S.-Korea FTA supporters. One is the dynamic that Abe raised is too prevalent, which is the critics are always critics of the FTA. The proponents of FTAs sell the benefits until Congress ratifies it, and it enters into force, and then we do two things. One, we, well, we do three things. We move on to the next agreement, we count the money from the agreement we just banked, okay, and we continue to complain about the things that aren't right about the Korea FTA. Now, the third one is the one I'd like to change. I can't stop people from doing business. I can't stop people from moving on to the next agreement, but if every person who supported the chorus, who has some problems with the agreement, who has some grumpiness about sanitary and phytosanitary standards, who has some concerns about the cosmetics regulatory working group, or whatever it might be, before you state your concern, spend 30 seconds telling whoever you're talking to about the benefits of the agreement. Start with, here's why this is good for America, here's why this is good for Koreans, for individuals, how it raised living standards, it eased trade, it solidified relations with an ally. Then I got these things to talk to you about. As otherwise, we're in a position where the critics criticize and the promoters criticize, and it's like, I'd stop that. I'd also stop talking about beef and autos because this isn't the US-Korea beef and auto agreement. It's the US-Korea free trade agreement, but that's a sideline, so I'll stop there. Look, I couldn't agree more with what Scott says. I just think we have the tendency to win the battle on these trade agreements. You fight to get them done. If I can get them negotiated, then you fight to get them through Congress, and then the coalition disperses the level of enthusiasm for even, not just for the agreement, but the focus on the relationship goes away. So I think we absolutely need to figure out how to do that better. I guess I would also just say two things with respect to the bilateral trade relationship. I do think NAFTA in some ways poses an interesting example in that you've had this enormous development happen in the legal framework for trade between the two countries, and then really not much else has happened in that bilateral, there's been a tremendous growth in trade and investment and all of those things, but the agreement itself has not really remained evergreen. It has not been. And I think now you see 20 plus years later with TPP and with Canada and Mexico coming back in, a refocusing, a thinking of how can we modernize this agreement, it would be nice if that happened with our FTAs more frequently than every 20 plus years. So I do think that is one. The last thing that I would say, and this harkens back to something that Kathy was saying before, which is, I think with this agreement, with Korea, the chorus agreement, excuse me, the EU, the EU-Korea agreement also did this, but particularly with chorus, Korea really established, I think it's bona fides as being at that front cutting edge of trade liberalization globally. I mean, if you look at the countries around the world that have actually been pushing forward and that Korea certainly is in the top handful, I'd love to see Korea continue to maintain that posture. I have no reason to think it's not going to, but you've got a lot of interesting trade negotiations going on in the region, TPP, you've got global initiatives around sectorals and so forth. It's just gonna, being at the forefront, being at the vanguard of trade liberalization requires constantly doubling down and constantly remaining committed. And we need to do that in the United States constantly. We do, and it's wonderful to see Korea having been in that place. I hope it remains in that place going forward. If I could add one thing to just build on Koran's comment. There's an interesting disconnect. Commerce is organic. It always moves forward. It always is discovering new things. It discovers new markets. It builds new relationships. It happens all the time. Free trade agreements, on the other hand, are a much different form of agreement. They are a treaty between two sovereigns. They tend to be very formalistic. They're very fixed. And what happens, and Koran was absolutely right about NAFTA, NAFTA was sort of the U.S.-Canada-Mexico relationship in roughly 1990 preserved in amber, like a fly caught there. This is where it was. And what happened is commerce moved on. In fact, what excites me about TPP and it looks like we're renegotiating with existing free trade partners. And we are because the way we do businesses change. Absolutely. And in fact, NAFTA was sold primarily, if not completely, on the notion of demand side, on selling things to each other. It's about getting market access and selling things to each other. What we do in North America today, we sell things to each other, sure, but we actually make things together. If you look at how North America works and supply chains and the way components travel across borders, the average ex-energy, the average Canadian import to the United States has 50% U.S. content. The average Mexican import to the United States has 40% U.S. content. We make things together, okay? And what we need are agreements that make things together, but it is, it's a disconnect that we've not figured out exactly how to solve. How do you put up this thing, that the treaties that stand with, you know, agreements on friendship, commerce, and navigation, stand in law with the organic dynamic nature of commerce? Before I ask Kathy to say her comments, I just want to say that after Kathy's comments, I'm gonna open up the floor to questions and answers for questions. So please prep your questions, please. Well, I don't think I can improve on what's just been said because I totally agree with it. And I mean, I like the image of a bicycle, may not surprise some of you, because I think that the Korea-U.S. Free Trade Agreement, like the overall relationship, has to be seen as something that has momentum, you know? It's like a bicycle, it needs to keep moving forward, otherwise it falls down. And that is a particular challenge with this kind of agreement as a very interesting point that I think we do need to ponder. And I just also want to reinforce this point of making things together, making stuff together is particularly powerful. And I saw a number of examples of it, discovered a number of examples of it during my time in Korea. Those, all those Samsung TVs that use Corning Glass from Corning, New York. Those batteries that go into GM cars and so on and so on. I would hope that we would see, and I think we will more and more of that, and that the Free Trade Agreement will encourage that. Great. Well, thank you very much. I want to give the audience an opportunity to ask the panel some questions, as well as the virtual world. But I wanted to turn to David first. David, who represents the agricultural sector and wanted to give him a minute or so to talk about how Corse is doing on the agricultural side. David, right there. Okay, thank you very much, Abe. I'm Dave Salmonson with American Farm Bureau. And I can see that both Congressman and the panel have referenced beef a few times. It was certainly a large part of the discussion back then. Two parallel things, of course, were happening then. Both we had tariffs that had to be negotiated in Korea for US beef, had a 40% tariff that was negotiated well. It's gonna be decreasing and phased out over 15 years. But at the same time, we had the countries that had closed their Marcus to US beef because of BSE back in 2003. So you had a tariff barrier and non-tariff barrier going on at the same time. And I think that, let us say, it complicated the discussions a little bit, but it was all resolved and I think to a good result. I think what the chorus is doing for US agriculture and will do as the tariffs phase out, as was referenced, this is a longer period of time. This isn't happening overnight. Korea is a very good market for US agriculture. Over $6 billion a year in US ag exports. We're our number one agriculture and food supplier to Korea, outside Korea, so about a 30% market share of the food market in Korea comes from the US. But it's expanded the opportunities for a wide range of products. USDA has a ag outlook forum every year and they had one a few weeks ago and one of the panels was talking about new markets. And then when they talked about Korea, they talked about blueberries and dairy. Where were the, I guess, the number one mozzarella supplier to Korea for pizzas? Which are certainly a growing product, I guess, in the Korean economy. So I view this as a longer term approach, but an expansion of market opportunities. We've been selling a lot of commodities to Korea. We will continue to do that for a broader range of fruit and veg products and processed food products. I think we'll see how that works out, but there certainly are good market opportunities there for US agriculture. Great, thank you very much. So any questions? Let's see Chad back there. Check, hello. Yeah, we've got some questions from Twitter, including one from Don Sudderton, a passionate career expert, global businessman, author and strategist. He asks. We should ask him. He says he works closely with the car industry and wonders if you can share any data on how the FTA has impacted the US and Korea auto industry. Thank you. The numbers at this point are somewhat irrelevant, because one of the things that happened in the last negotiations on automobiles is the phase out of tariffs and both in the United States and Korea were delayed. So those will be late phase out. Certainly the 25% truck tariff still exists for the US on Korean-made light trucks and will exist for eight years after entry into force. It's only the 9th and 10th year of those phase out. The 2.5% tariff on cars in the US is still in place. The 8% tariff on Korean cars on US cars into Korea is still in place. So year one, it makes no sense to look at the auto trade primarily because the agreement has yet to actually affect terms of trade in the auto business. So I would caution that first. Well, you have seen an increase in foreign auto penetration even in the period of time since the agreement was negotiated. But I was having a very interesting conversation with Toyota, actually. And I learned that, unbeknownst to me, that Toyota is actually now exporting vehicles from the United States to Korea and is doing so quite successfully. So I just think it's an interesting example of... And to be honest with you, I think this goes more broadly than just the auto sector. I think America... And I speak on behalf of a major American manufacturer that is still very much in the process of getting its head around what it means to be able to compete. What you need to do to compete globally and to compete in markets that you here to for have not been big in. And within our own company, we have a massive effort underway to become a better global company. And that requires a tremendous amount of hard work. It requires changing the mindset of executives that here to for have always thought about the domestic market. And have been able to think about the US market because it's so big. But when you are trying to get growth, the way we and many other American companies it's gonna require you to go abroad. And even for our own company in the past seven, eight years, we've seen previously 60% of our revenues were derived in the United States, 40% globally. In the last seven, eight years, that number has flipped. Now 60% is global, 40% is in the United States. And that difference is only gonna continue to grow. But the only way it's going to be able to grow is by truly being invested. And that means building products that are appropriate for the local markets. That means having a presence on the ground that's not simply just a sales guy. It means having a deep seated presence. It's the kind of things that we are doing actually in Korea to some great success for our company. And we think other American companies are gonna follow in that regard. Yes sir. I don't have the concrete statistics but 10 month statistic of trade of auto to Korea. I mean, US export to Korea shows more than 90% increase. That means US auto is faring well. But we have a serious US auto investment in Korea. We have GM Deo. So GM Deo spares very well. I think their market share is around 10%, at more than 10% of Korean market share. Also they exports well around the region. So I think GM Korea fares well. That's why other automakers does not fare well. And but nevertheless the core safety shows not more than 90% increase of US auto to Korea. That includes Toyota too. Thank you. And last time I had a rental car it was a very fine made in USA product called the Hyundai Sonata. Yeah. Ha ha ha. We go to Richard back there, Richard. Hi, Richard Shin. Thank you very much for your presentation. I have two quick questions. First of all, in the Korea EU trade agreement after its implementation, my understanding is that Europeans have benefited more than the Koreans in terms of imports and exports. That is Europeans are exporting more to Korea than Koreans exporting more to, relative to what Korea is exporting to Europe. I was wondering if anyone had looked at statistics for the Coral's trade agreement and see if there was any kind of a pattern or similar pattern or whether the US is benefiting more well to Korea. Second question is, you know, even with this Coral's FTA in being implemented for large companies, they're probably prepared but there are a lot of small and medium sized companies in both Korea and United States who really don't know what to do with this new agreement. And I was wondering whether there are government programs both in the United States and Korea that facilitate this type of trade between the two countries among especially the small and medium sized enterprises. Two great questions. In terms of the post entry into force data, this is believe 10 month data, the total US Korea trading volume is $80 billion. US imports from Korea are $47 billion up 1.2%. US exports to Korea are $33.6 billion down 8.1%. Now there are two factors here. First, there's been consistent bilateral trade deficit with Korea. I think it is probably washes out in the Asia trade deficit because what's happening is components are going to Korea from the United States on to China for final assembly. It comes back to the United States as a product of China. So there's a lot, bilateral trade deficits is, I would just point out, I have a permanent irreconcilable bilateral trade deficit with my barber. I buy a haircut from her every two weeks, she never buys anything from me. Okay, and yet somehow in our individual macro economies, it all works out. Okay, so bilateral trade deficits are, first of all, 10 months, so it's less than a year's data, it's also dangerous for a lot of other reasons and mostly how we count things these days. But Korea has maintained a modest current account surplus in the bilateral relationship with the United States. As the minister pointed out, that is goods only, if you add in services, it's a very balanced relationship and the US has grown in service exports to Korea. And also I think it does bear mentioning, I think the minister alluded to this, the difference between items that are beneficiaries in the tariff reductions thus far and items that are not. For items that are beneficiaries, you've seen the US exports, well, you've seen both sides exports grow. US exports grow to somewhere about 2.2% and for Korea, the numbers are about 8%. So, but look, I would agree with Scott. I mean, we are so early on in this process, right? We are so early on, the kinds of big capital goods that tend to flow that US tends to have as exports have long lead times. I mean, we sell things that you're making the sale today, the good itself and the items don't flow potentially for 18 months, a year, two years, so forth. So, we've got to give this a little bit of time before you start judging that. Well, and then maybe the other point about the small and medium businesses who perhaps are less able or less expert in taking advantage of the opportunities the FDA offers. I think that's something that both governments are quite mindful of. I'm not directly involved myself, but I have observed that certainly our foreign commercial service and the US commercial service here in the US is very focused on in the respective countries, providing the kind of support and advice they can to small and medium businesses. I mean, the big companies really don't need that. And from what I read in the Korean press, that's very much a feature of particularly the new administration. Is that right, Minister? Sure. You need to turn on the mic. Korea and the United States agreed to establish a special committee on SMEs, which means we are going to, both of us, USTR and US government and Korean government will make a special effort to support SMEs to benefit more from FDAs. Normally, they are not good at how to utilize FDAs. So, our aim, one of our aims is to increase the utilization rate grow among SMEs. So, during a very recent SME subcommittee meeting that took place in Washington, D.C., we agreed, both sides agreed to make a survey, an impact, FDA impact on SMEs. I think the ITA is undergoing some study. I think based on that, we make some very substantial recommendation what to do. And at the same time, Korean Embassy has launched some website, KoreaUSConnect.org. I think this is a very useful website. We explored 64 US SMEs success stories, so which was published in hard form and also internet shape. So, you can get an access to US KoreaConnect.org. I think this is a tremendous information resources. Thank you. Great, thank you. Please. If I could add to the impact on small and medium-sized businesses, if they are not taken care of, this agreement is a failure. I'm just saying that it's a failure. I mean, if you think getting TPP through Congress is going to be easy unless you're having small and medium-sized businesses that are beneficiaries of this agreement, I would suggest this. First of all, COTRA, which is the Korean Economic Development Arm, regularly is putting on matchmaking conferences. I think there's one going on in Miami in a couple of weeks where they will line up 10 or 12 small to medium-sized manufacturing companies that will show the capabilities, the billing, et cetera. And then they'll try to match up company to company. It's a little bit different, as opposed to product to product. But it may be easier, because in the conference that we had in Rockford, Illinois, the consensus there was that companies would be cataloged as what they can do in terms of capability. Because this is not intermediary machining, it's working on a final product. So COTRA is really involved with that. But one of the things that I would throw out to you, Karana is representing a large company, GE Aviation came into my district about three years ago and put on two fabulous supply chain shows. I actually managed the whole thing. I was there the entire period of time, extraordinarily successful. We had manufacturers that are now selling to GE Aviation that never dreamed of the past. And GE Aviation is not only expanding horizontally but vertically. One of the few companies in the world that's going in both directions at the same time, because of the quality they insist on in the aviation products. And I would challenge the large corporations that really push this to reach down into the supply chains. If they want to know how to do it, then just give me a call. I'm serious. It's a supply chain conference where the little people get involved. And I know that's what Richard was talking about back there. And I chaired the Small Business Committee for six years. And so I know how to do that. But I'd be willing to work with you on anything that you want to do to help out the small, medium-sized guys. It's fantastic. First of all, fabulous point, Congressman. And I think you all know, but there has been no bigger advocate for both trade and for the benefits to small and medium-sized enterprises than Congressman Manzullo has. I couldn't agree more. I was going to add on to the point. Look, I think one of the great virtues of the many types of trade flows that are going to increase, certainly small and medium-sized enterprises on their own, but also small and medium-sized enterprises for whom the groundwork is going to be laid by large entities like a GE or a Boeing or a Caterpillar or whatever that will go in there, both because we in some ways are the aggregators of small businesses. I mean, we have thousands of SME suppliers into our aircraft engines or our turbines or health care devices. But also because that opens an opportunity to create familiarity, to create connections, to create bridges through precisely the kinds of things that, Congressman, you're talking about. And we have done those kinds of conferences and we'll continue to do so. We have a final few minutes, but I wanted to end with this question to our panelists is, what's the way forward now in the post-course FTA era? Where does US-Korea economic relationship go from here? You talked about commerce being very organic. And I think we talked about it a little bit in our discussion already. But where do we go from here? Let's start with you, Scott. Sure. Well, look, Korea is in a very interesting position in that it is a member of, as a free trade agreement with the United States, it is negotiating RCEP. It's a member of APEC. It has trade relations with basically all its key trading partners throughout East Asia. And my own vision for this is that what I hope will happen if you just look at East Asia and the consolidation and deepening of economic relationships in Asia-Pacific, I think Korea is a key player in this whole process. Because what you want, what ultimately all the economies of East Asia and the Pacific will want, is interoperability between trade agreements. They'll have different market access rules and different commercial rules and different disciplines. But what you want is for border procedures and the measures that make supply chains work effectively, you want them to be able to operate in a seamless manner. So it's the same way if you've got old documents done in Windows 98, they still run on Windows 7. Though they aren't identical programs, but they're sufficiently interoperable. And I think that would be the goal, particularly on the procedures in and around customs and transport and communications near the port. Because that's really what makes supply chains work. Korea is well-positioned. I think if they chose to join the Trans-Pacific Partnership, it would be very straightforward because of the similarities with chorus. But even suspending that choice for the government to make on its own timetable, the fact that it is negotiating with or has agreement with all these partners in East Asia, it can play a pivotal role in the further consolidation and economic integration in East Asia and the Pacific. Cara? Well, I think a lot of this has been said. I mean, I think we've identified. I mean, we've got to make the chorus of FDA work and work for small and medium businesses, work for both sides, work within the context of the broader relationship. And I think President Obama's been pretty clear about where he sees the US going from here, both in terms of strengthening and broadening and deepening our strategic alliance with the Republic of Korea. And that emphatically includes this growing economic relationship. But also moving forward with the momentum and the lessons and the partnership that we've developed by doing this agreement to do others. And that's going to be clearly a very large priority for this administration in the coming couple of years. Look, I would echo what both Kathy and Scott have said. I guess it's interesting sitting in the vantage point that I now sit in, having been in government. The agreement's in place. It's a great agreement. It is going to yield success. I have no doubt about that. I think now, in some ways, the focus turns back to both government policies and other spaces and the responsibility of the corporate sector, the business sector. And there I'd sort of say I'd throw three ideas out. I think, first of all, we need to see a continued ongoing reform and opening process in Korea. The FDA was a great step forward. It's moved the ball. But this is not a static thing. It's not that you're done. There needs to be continued momentum and progress. And I believe that's going to happen. And I'm focused only on Korea at the moment. We need to do a lot in the United States to continue to grow and strengthen our own economy as well. Point two, I would say, from a corporate perspective. I think you're seeing within the Korean corporate community an increased focus on how to raise their own innovative capacity. And I think that's a fabulously important thing. I think the Korean manufacturing has hit new highs. I think they're superb in that. I do think that we need more innovative capabilities there much as we do in the United States. So I applaud the Korean focus on that. And then the third is, frankly, partnerships. I think we're opening a new day for the idea of US-Korean business partnerships that in some way will mirror the kinds of bilateral governmental partnerships that we've seen. And so I would look for that both with respect to the Korean market and with respect to third country markets. And I think the US stands to gain. And American companies stand to gain a lot from that. And Korean companies do as well. Great. Well, thank you very much, Kathy, Karan, Scott. Please help me thank our panelists today. Thank you very much.