A delay in the parliamentary ratification of the pending free trade deal with the United States could inflict a huge economic loss on South Korea along with policy uncertainties, a ranking trade official said Tuesday.

The free trade accord, known as the KORUS FTA, was signed in June 2007 and supplemented in late December of last year with minor modifications that mostly deal with the auto industry. The agreement was ratified by the U.S. Congress last month and Seoul is under mounting pressure to follow suit.

Lawmakers here, however, remain locked in debate over ratifying the pact, as opposition parties claim it favors the U.S., calling for renegotiations and more protections for local farmers and industries. The government wants the deal to take effect starting next year.

“Our economy could lose benefits from an early implementation of the free trade pact,” said Choi Seok-young, South Korea’s deputy trade minister, in a radio interview. The official claimed that a one-year delay in the ratification of the pact could result in 15 trillion won ($13.3 billion) in economic losses.

He said local exporters have been preparing for new business opportunities in line with the implementation of the free trade accord, but they could face uncertainties if the parliament further delays the approval of the pact.

According to the report jointly compiled by 10 local state-run think tanks, including the Korea Institute for International Economic Policy, if the deal takes effect, South Korea will see its gross domestic product expand by an additional 5.66 percent in the long term.

The think tanks also predicted that South Korea would see its trade surplus with the U.S. increase by $140 million annually over the next 15 years after the FTA goes into effect. 

(Yonhap News)