The United States International Trade Commission (USITC) estimated in September 2007 that the agreement could increase U.S. exports by $10 billion to $11 billion annually. President Obama has said that the agreement could support at least 70,000 U.S. jobs.  These estimates are conservative and do not capture the potential for growth of U.S. services exports to South Korea — where the United States already enjoyed a more than $6 billion trade surplus in 2009. 

Demand in South Korea, our seventh largest trading partner, for “made in U.S.A.” products is growing: U.S. goods exports to South Korea rose to $38 billion in 2010, and South Korea was the fastest growing export market for U.S. manufactured goods that year, increasing 39.6 percent.

This trade agreement is central to U.S. strategies to secure a competitive edge in Asia, as the region becomes increasingly interwoven by trade deals that leave out the United States. The agreement offers a powerful model for how major economies can successfully tackle challenging regulatory systems and market access barriers to create a fair and level playing field. In fact, the strong rules and protections in the FTA are considered to be the baseline for the ongoing Trans-Pacific Partnership negotiations which, if successful, could lay the foundation for a possible free trade area of the Asia-Pacific region.

This agreement also must be considered in the context of the broader U.S.-Korea relationship, which is more vital to U.S. strategic and security interests than ever before. North Korea’s continuing provocations, including the sinking of the Cheonan navy ship and the attack on Yeonpyeong Island, firmly reinforce the importance of the U.S.-Korea security alliance for protecting regional stability. 

South Korea has increased its international leadership role as well through the G20, partnering closely with the United States to address shared global challenges. In fact, South Korea was the chair of the ambitious and successful G-20 summit last November, is an important provider of international development assistance, and plays an increasingly active role in peacekeeping and disaster relief efforts. U.S. and South Korean leaders say bilateral relations today are at their strongest level ever — and it is in America’s interests to take every action that will reinforce this. By further integrating the two countries’ economies, the FTA will deepen and add to the resiliency of this partnership.

The window of opportunity for the United States to take full advantage of the potential to create new jobs and growth through the FTA is, however, shrinking rapidly. On February 17, the European Parliament approved the EU’s free trade agreement with South Korea. This agreement will eliminate nearly 99 percent of all duties on trade in manufactured and agricultural goods between the EU and Korea within five years. It will also offer EU manufacturers, farmers, and services providers many of the same protections and market opening provisions that their American counterparts will enjoy under the U.S. Korea FTA. The EU agreement is slated to enter into effect this July. 

Without quick action by Congress to approve the U.S.-Korea FTA, American workers and producers risk losing out on the chance to bolster their business and market share in Korea by giving European exporters a head start. We have already seen these kinds of market share losses in Colombia and Panama with the delay to act on passing these two important agreements as well.

Last December, U.S. and South Korean negotiators successfully reached agreement on additions to the FTA that create important new access in South Korea for U.S. automakers. This accomplishment brought together both U.S. auto manufacturers and the United Auto Workers Union in support of the agreement — a significant achievement that has added powerful new momentum to moving the FTA forward. 

With global competitors one step ahead of us, however, there is no time to lose. A study by the U.S. Chamber of Commerce found that as many as 345,000 U.S. jobs and $35 billion in U.S. exports could be on the line if the EU-Korea FTA and the pending Canada-Korea FTA enter into effect and U.S.-Korea FTA does not. A vote to approve the FTA before July 1 should be at the top of Congress’ agenda.  

William Rhodes is a senior advisor to Citigroup and Chairman of the U.S. Korea Business Council.