2012-3-4

In 2011, U.S. President Barack Obama told South Korea he would send the U.S.-South Korea Free Trade Agreement to Congress for review only if “South Korea agrees to import all parts of U.S. beef, regardless of the age of the cattle.” However, the beef protests of 2008 were on such a massive scale and still so fresh in the memory that South Korean President Lee Myung-bak hesitated to agree to such a demand, and even the U.S. had to make some concessions.

In the end, the U.S. agreed only to sell beef to South Korea that was under 30 months old at the time of slaughter—knowing all the while that this was just a temporary move.

Now South Korea has become the fourth largest export market for U.S. beef. Its imports of American pork are also expected to increase several fold in the next few years. As a result of the trade agreement, roughly 30,000 jobs in the animal husbandry industry are expected to be created in the U.S. As for South Korea, its gross domestic product is projected to increase by 5.56 percent as a result of the trade accord, with over 350,000 new jobs created.

In terms of GDP growth, South Korea will gain far more than the U.S. Which is why it was willing to yield to the U.S. on the beef issue. The alternative would have been to sacrifice the interests of Hyundai automobiles and Samsung electronics.

A similar set of events is now playing out in Taiwan. Even though the agriculture industry accounts for less than two percent of Taiwan’s GDP, farmers played a large role in the nation’s recent presidential elections. In the U.S., on the other hand, the agriculture industry accounts for six percent of GDP.

Now that Obama is fighting for re-election, he will certainly want ROC President Ma Ying-jeou to help him, just as he helped Ma with his re-election campaign. Obama will want Ma to help reduce unemployment in the U.S. by agreeing to import American beef and ractopamine-enriched U.S. pork as well. Since the U.S. presidential elections are in November, Obama will expect Ma to return the favor very soon.

Taiwanese want the Trade and Investment Framework Agreement with the U.S., but they do not want ractopamine. Did the Koreans and Japanese not feel the same way? Taiwan’s economy will grow as a result of both the Cross-Straits Economic Cooperation Framework Agreement (ECFA) and TIFA. Without TIFA, Taiwan will fall farther behind South Korea, and will be forced to move closer to mainland China.

Taiwan Sugar Corp. and many flower growers in Taiwan have made investments in the U.S. for the production of butterfly orchids. Perhaps the government can do something for pork farmers, by helping them relocate to the U.S. They could then raise ractopamine-free pork there and ship it back to Taiwan. That is the strategy followed by some companies in Japan.

When South Korea first opened up to U.S. beef, major distributors there refused to sell the product, out of fear of offending their customers, and U.S. beef could only be purchased at certain specialized stores. South Korean beef importers also refused to import U.S. beef offals as well.

Surely, the ROC government can come up with equally creative ways to control beef imports at their source. It should be able to help importers and distributors in their desire to either sell or not sell U.S. beef and pork imports; so that those who are afraid of ractopamine have the option of not buying it, while those who do not mind it can have it if they want. If the government is successful in this task, Taiwan, too, should be able to open the nation’s doors to U.S. beef and pork products, just as Japan and South Korea did.

Since the 2009 financial cri