Free-Trade Pact U.S. Job Gains May Be Underestimated, Kirk Says
Free-trade agreements with South Korea, Colombia and Panama may create or support more than the 70,000 jobs estimated by economists because service industries will add workers, U.S. Trade Representative Ron Kirk said.
Kirk said the forecast by the independent U.S. International Trade Commission focuses on manufactured goods and may not fully account for a jump in business for service companies, and “we very much excel in services.”
“We think it is a bit conservative,” Kirk said today in an interview with Bloomberg Television on the floor of the New York Stock Exchange. “In the case of Korea, the United Auto Workers would not have endorsed this agreement if they thought it would cost us jobs.”
The deals, reached by George W. Bush more than four years ago and revised by President Barack Obama, cleared Congress last week. Obama negotiated new terms for auto tariffs from South Korea that won over the auto workers, a tax-information exchange with Panama and labor-rights assurances from Colombia. He plans to sign the legislation for the deals in the Oval Office tomorrow, his administration said on Oct. 18.
Groups including the AFL-CIO, the nation’s largest labor federation and a frequent Democratic ally, opposed the agreements. AFL-CIO President Richard Trumka had urged lawmakers to reject them, saying in an Oct. 4 speech in Washington that the accords will destroy 159,000 jobs by encouraging companies to send work overseas.
‘Component Parts’
“You cannot associate all imports with job loss,” Kirk said today. “Much of what we import are component parts that go into goods that we make and sell elsewhere.’
The South Korea deal is the biggest for the U.S. since the North American Free Trade Agreement in 1994. It will boost American exports as much as $10.9 billion in the first year that it’s in full effect, according to the trade commission. The accord with Colombia will increase exports as much as $1.1 billion a year.
Companies such as Ace Ltd. (ACE), Citigroup Inc. (C) and Pfizer Inc. led the effort to pass the South Korea deal, while Caterpillar Inc. (CAT) and General Electric Co. (GE) were among the biggest backers of the accord with Colombia.
To contact the reporter on this story: Eric Martin in Washington at emartin21@bloomberg.net
To contact the editor responsible for this story: Larry Liebert at lliebert@bloomberg.net
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