As the deadline draws near for Congress to vote on an FTA prior to the expiration of TPA, successful conclusion of FTA negotiations between the United States and Korea and between the United States and Malaysia also becomes less certain. Successive rounds of negotiations with Malaysia have yielded little agreement. It is virtually certain that there will be no agreement this month, but both sides suggest they will work to conclude the negotiations.

The eighth round of negotiations between the United States and Korea concluded March 12; the two governments remain optimistic about concluding an agreement by the end of March. Contentious issues upon which the United States and Korea have yet to agree include Korea’s current restrictions on imports of U.S. beef (an issue not formally part of the free trade negotiations), how rice will be treated in the negotiations and a dispute of phase-out periods – or even possible immediate elimination – of Korean and U.S. tariffs on imported automobiles. There are also proposals for a safeguard mechanism to suspend the duty elimination on imported automobiles if Korean imports increase too much and for authorization to retaliate if Korea institutes new non-tariff barriers. Negotiations also continue in textiles and on pharmaceuticals and medical devices.

Negotiations with Korea, however, are not only influenced by the impending expiration of TPA. The outcome of the negotiations may actually affect the likelihood of renewal of TPA. Some in Congress have indicated that USTR’s response to congressional demands about automobile duties, beef and similar issues in the ongoing negotiations may be interpreted as a signal of how prepared USTR is to work to create trade agreements that are acceptable to the newly elected Congress. This signal may, in turn, affect the willingness of Congress to renew TPA.