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Introduction

On June 30, 2007, the governments of the United States and Korea signed a free trade accord and pledged to work together to secure legislative approval for the agreement in both countries.¹  Korea is the world’s thirteenth largest economy and the United States’ seventh largest trading partner, and if ratified by the parties, the accord would create a free trade area for the United States second in dollar value only to that created when the North American Free Trade Agreement (NAFTA) entered into force in January 1994.²

Human Rights Watch generally takes no position on free trade per se, and the US-Korea Free Trade Agreement (FTA) is no exception.  Instead, we believe that trade agreements can provide important leverage and opportunities to promote workers’ rights, and we advocate for meaningful, enforceable labor rights protections in the fabric of accords.  Therefore, we are especially concerned that an important annex to the US-Korea FTA creates the possibility that North Korean goods from specially designated outward processing zones,³ produced by workers whose rights are not protected in law or practice, could enter the United States duty free under the agreement.

Annex 22-B of the US-Korea FTA directly flouts the spirit of the recently amended workers’ rights provisions in the accord.  These provisions were changed to reflect the strengthened labor rights protections elaborated in the new trade policy template agreed to by the US Trade Representative (USTR) and congressional leadership on May 10.⁴  Human Rights Watch applauds these improvements and the potential they hold for greater respect for the rights of workers producing goods for export under the accord.  As drafted, however, Annex 22-B not only rejects these stronger workers’ rights provisions in the main accord, but adopts as an acceptable reference point for assessing labor conditions one of the worst human rights standards in the world—the situation elsewhere in North Korea.

Annex 22-B could use free trade as an agent for positive change.  North Korea is presently one of the most closed countries and has a dismal human rights record.  The government often quashes basic human rights and freedoms, sometimes resorting to arbitrary detention and torture against those who resist, and fails to protect some of the most fundamental workers’ rights.  North Korean outward processing zones provide an important opportunity for engagement with this otherwise hermetically sealed country.  If the United States and Korea seized this opportunity by offering possible trade accord benefits to those zones where respect for workers’ fundamental rights could be credibly and continuously demonstrated, significant rights improvements could result.  Such improvements would impact zone workers immediately and could possibly extend to others beyond the zones in the future, as they learned more about the new culture of rights.  As drafted, however, Annex 22-B falls far short and squanders this critical moment.  Accordingly, Human Rights Watch strongly urges the United States to negotiate amendments to Annex 22-B based on our recommendations below and calls on the US Congress to reject the US-Korea FTA if Annex 22-B remains in its present form.