Bloomberg News

Obama Signs Trade Deals With South Korea, Panama, Colombia

October 21, 2011

(Updates with Obama’s calls to Colombian and Panamanian president in fourth paragraph.)

Oct. 21 (Bloomberg) -- President Barack Obama signed into law free-trade agreements with South Korea, Colombia and Panama that the administration says will support tens of thousands of American jobs.

Obama has cited the trade deals -- the biggest package in 17 years -- as a way to create or maintain U.S. jobs. He also signed a bill renewing the Trade Adjustment Assistance program for workers who lose jobs because of foreign competition.

“American job creators will have new opportunities to expand and hire as they access new markets abroad,” U.S. House Speaker John Boehner, an Ohio Republican, said in a statement after the measures were signed.

The president called Colombian President Juan Manuel Santos and Panamanian President Ricardo Martinelli earlier today to congratulate them and stress the importance of all sides meeting the “obligations of the agreements,” according to White House press secretary Jay Carney. Obama urged “continued progress” on the Colombia Labor Action Plan during the call.

Organized labor was split on the accords, with the AFL-CIO opposing them and the United Auto Workers urging lawmakers to support approval. AFL-CIO President Richard Trumka said in an Oct. 4 speech in Washington that the agreements would destroy 159,000 jobs by encouraging companies to send work overseas.

Oval Office Signing

The White House had initially scheduled a public ceremony in the Rose Garden for the signing. Those plans were canceled yesterday in favor of an Oval Office signing in front of photographers only, followed by a closed Rose Garden reception. In an e-mail, Carney cited a “busy day” as a reason for the switch.

“He probably couldn’t get labor to stand by his side and standing alone, or just with business, it would be a disaster, given the growing Occupy Wall Street world and the fact that most Democrats voted against it,” Kevin P. Gallagher, a professor of international relations at Boston University, said in an e-mail.

“Where this agreement was signed is not the issue,” said Amaya Tune, a spokeswoman for the AFL-CIO. “The fact is that it will contribute to the loss of hundreds of thousands of American jobs at a time when workers are still trying to dig out of a large hole.” Officials for the U.S. Chamber of Commerce, a proponent of the agreements, declined to comment.

Lee Visit

On Oct. 14, Obama and South Korean President Lee Myung-bak traveled to a General Motors Co. assembly plant in Michigan to highlight prospects of increased sales and jobs for the beleaguered U.S. auto industry.

Companies such as Ace Ltd., Citigroup Inc. and Pfizer Inc. led the effort to lobby for passage of the South Korea deal, while Caterpillar Inc. and General Electric Co. were among the biggest backers of the accord with Colombia.

The chairman of the Business Roundtable, a Washington-based association of chief executive officers, today called the agreements “a pivotal event.”

“It’s now time to build on this milestone and focus on the future,” said Jim McNerney, who is chief executive of the Boeing Co. and a member of Obama’s White House Jobs and Competitiveness Council. About 95 percent of the world’s consumers live outside the U.S., he said.

Seizing the Opportunity

“If we do not seize the opportunity to lead, others will, and the accompanying economic benefits will accrue to their nations rather than ours,” he said in a statement.

The signings took place as Obama prepares for a three-day swing of Western states next week and before G-20 economic talks in France set for Nov. 3-4.

The agreements, negotiated by President George W. Bush, were revised by the Obama administration to include new terms for auto tariffs from South Korea, a tax-information exchange with Panama and labor-rights assurances from Colombia.

The South Korea deal is the biggest for the U.S. since the North American Free Trade Agreement in 1994. It will boost U.S. exports as much as $10.9 billion in the first year that it’s in full effect, according to the U.S. International Trade Commission. The accord with Colombia is expected to increase exports as much as $1.1 billion a year.

--With assistance from Kate Andersen Brower in Washington. Editors: Joe Sobczyk, Jim Rubin.

To contact the reporter on this story: Roger Runningen in Washington at rrunningen@bloomberg.net

To contact the editor responsible for this story: Mark Silva at msilva34@bloomberg.net


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