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South Korean, US Trade Officials Rush to Strike Deal
POSTED: 3:50 p.m. EDT, January 16,2007

Drawn-out free trade talks between South Korea and the U.S. entered a second day on Tuesday, as real give-and-take on automobiles and other sensitive issues is expected to be made at backroom negotiations.

This week's talks, the sixth since last June, come as time is running short for a deal to be reached before U.S. President George W. Bush's "fast-track" trade promotion authority expires on July 1.

Under Bush's authority, U.S. negotiators have until April 2 to submit a deal for an official 90-day review by Congress for an outright up-or-down vote without amendments.

The deal also requires ratification by South Korea's National Assembly but the tight U.S. time restriction has raised concern that a deal could be clinched in time.

"The U.S. side strongly wants to wrap up talks by the end of February, because they need two to three weeks to prepare for legalization of an agreement for a congressional vote," said a senior South Korean trade official, requesting anonymity.

South Korean officials said the two sides have "tentatively" decided to hold one more round in February to wrap up the talks.

During the scheduled five day talks in Seoul, both sides have agreed to focus on "less sensitive" issues such as a phase-out of tariffs on industrial goods, competition and intellectual property rights, according to South Korean officials.

Three most sensitive issues -- anti-dumping remedies, automobiles and pharmaceuticals -- will be tackled at informal negotiations involving top-level delegates, both sides said.

South Korea is demanding revision of U.S. anti-dumping laws which it believes have often been used unfairly to curb its exports. The U.S. is seeking to protect its pharmaceutical patent rights and revise South Korea's tax system to expand its auto exports.

After the first day fo talks on Monday, the chief South Korean delegate, Kim Jong-hoon, said the three tricky issues can be resolved through give-and-take.

"We won't make concessions on autos and pharmaceuticals unless there is no progress on the issue of anti-dumping remedies," Kim told reporters.

Kim also said that a separate channel of dialogue was being opened to try to resolve the issue of textile trade. The two-day talks starting in Seoul on Tuesday will involve South Korean Deputy Commerce Minister Lee Jae-hoon and Scott Quesenberry, the top textile negotiator from the U.S. Trade Representaive, he said.

Textiles are another key area of South Korean concern. South Korea has proposed phasing out textile tariffs over five years but the U.S. insists on 10 years.

The chief U.S. free trade negotiator, Wendy Cutler, said that a deal still can be made in time, although some knotty issues remain unsolved.

"Our challenges are real, but they are not insurmountable," Cutler said. "The U.S. is prepared to make progress in all of these three issues at the chief negotiator level."

Outside the conference room, 15,000 riot police stood guard to protect the talks. Farmers and anti-globalization activists planned large-scale street protests on Tuesday.

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