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Viewing cable 06SEOUL2488, FTA LABOR TEAM MEETS KCTU, OTHER LABOR GROUPS

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Reference ID Created Released Classification Origin
06SEOUL2488 2006-07-24 23:20 2011-08-25 00:00 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy Seoul
VZCZCXYZ0010
PP RUEHWEB

DE RUEHUL #2488/01 2052320
ZNR UUUUU ZZH
P 242320Z JUL 06
FM AMEMBASSY SEOUL
TO RUEHC/SECSTATE WASHDC PRIORITY 9280
INFO RUEHBJ/AMEMBASSY BEIJING 0985
RUEHKO/AMEMBASSY TOKYO 1062
RHMFIUU/COMUSKOREA J2 SEOUL KOR
RHMFIUU/COMUSKOREA SCJS SEOUL KOR
RUEHC/DEPT OF LABOR WASHINGTON DC
RHMFIUU/COMUSKOREA J5 SEOUL KOR
RUCPDOC/DEPT OF COMMERCE WASHDC 1526
UNCLAS SEOUL 002488 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
STATE FOR EAP/K AND EB/TPP/BTA 
PASS USTR FOR CUTLER, KARESH, ANGEROT AND KI 
 
E.O. 12958: N/A 
TAGS: ECON ELAB ETRD KS PGOV
SUBJECT: FTA LABOR TEAM MEETS KCTU, OTHER LABOR GROUPS 
 
SENSITIVE BUT UNCLASSIFIED -- PLEASE HANDLE ACCORDINGLY 
 
SUMMARY 
------- 
 
1.  (SBU) Formally meeting with U.S. officials in Seoul for 
the first time, the Korean Confederation of Trade Unions 
(KCTU), the more radical of the ROK's two major labor 
federations, welcomed the U.S. FTA labor negotiators to their 
headquarters on July 13.  In a professional and business-like 
meeting, KCTU officers outlined their objections to the FTA, 
criticized the ROKG for its lack of transparency, and 
suggested an open meeting among representatives of the and 
USTR and members of U.S. and Korean labor groups.  The U.S. 
negotiators also met with leaders of the Federation of Korean 
Trade Unions (FKTU), the other major trade federation, who 
voiced similar concerns.  Finally, the negotiators met with 
an AFL-CIO Solidarity Center representative, who said that a 
divide was opening between the U.S. labor movement, which was 
firmly opposed to the Kaesong Industrial Complex (KIC), and 
the Korean labor movement, which believed the promise of KIC 
as a path towards unification trumped any inclination to 
voice concern over worker rights in the DPRK.  END SUMMARY. 
 
FIRST MEETING AT KCTU HEADQUARTERS 
---------------------------------- 
 
2.  (SBU) On July 13, KCTU Vice President Heo Young-koo 
welcomed A/USTR for Labor Lewis Karesh, USTR Senior Director 
for Korea Scott Ki, Department of Labor International 
Economist Carlos Romero, and Poloff to a "historic" first 
meeting at KCTU headquarters.  The economically-powerful 
KCTU, a labor group with a deep anti-American streak and a 
propensity for violence, has for years refused all meeting 
requests from U.S. officials in Seoul.  (NOTE: We understand 
through informal channels that KCTU leadership always 
believed that formal talks with Embassy officials would 
undermine their credibility with the KCTU rank-and-file. 
Obviously anxious to keep this meeting low-profile, KCTU 
officials ushered us quickly into the building to avoid media 
attention.  END NOTE.) 
 
3.  (SBU) Heo had both procedural and substantive objections 
to the KORUS FTA.  He criticized the ROKG for being too 
secretive about the negotiating process and, in particular, 
 
SIPDIS 
failing to make public the documents under discussion.  Heo 
said that increased transparency and public input would 
increase the chances that an FTA's benefits would be equally 
distributed.  Negotiations should stop, he said, until the 
ROKG fulfilled its obligation to engage in dialogue with 
civil society.  Karesh responded that it was standard in all 
FTA negotiations for governments to enter into a 
confidentiality agreement in order to facilitate full and 
 
SIPDIS 
frank discussions during negotiations.  Explaining the U.S. 
system of public advisers and Congressional oversight, Karesh 
said that it was up to each government to decide how to 
interact with constituent groups while protecting the 
confidentiality of the negotiations. 
 
SIPDIS 
 
4.  (SBU) Pressed for information about the KORUS FTA labor 
chapter, Karesh referred Heo to the labor chapters of 
previous FTAs and their protections for internationally 
recognized labor rights.  Karesh emphasized that the U.S. has 
a strong commitment to labor and that the U.S. Congress has 
provided clear direction that all FTAs must include labor 
protections and the commitment of each country to effectively 
enforce its labor laws. 
 
5.  (SBU) Heo's substantive concern was that the FTA would do 
little to protect worker rights.  Heo said that the essence 
of all FTAs was to strengthen foreign investor rights and 
benefit companies and investors, often to the detriment of 
workers.  The issue was of such concern to the KCTU, that the 
Confederation organized only for the second time a mass rally 
outside the U.S. Embassy.  According to Heo, the KCTU's goal 
was to organize a 100,000-person demonstration for Round Two 
of negotiations, but because of rain, only 50,000 gathered. 
KCTU intended to build on the allegedly growing opposition to 
the FTA to organize a one million-person demonstration for 
Round Four, which will also be in the ROK. (NOTE: Seoul 
authorities said that about 24,000 people gathered for the 
July 12 demonstration.  Heo's claim that the demonstration 
was only the second major demonstration outside the Embassy 
is dubious.  KCTU and its affiliated groups demonstrate for 
various reasons outside the U.S. Embassy with such regularity 
that most embassy officers with street-side offices can 
readily hum KCTU protest anthems, which are curiously able to 
pierce the reinforced concrete of our Chancery.  END NOTE.) 
 
6.  (SBU) Heo cited NAFTA as an example of an FTA that 
promised worker protections but in fact did little to protect 
worker interests.  Not one labor case has been brought to 
arbitration, he said.  Karesh parried that there have been 
over thirty labor submissions under NAFTA, variously brought 
in the U.S. regarding Mexico or Canada or in Mexico regarding 
the U.S.  Most have involved allegations concerning freedom 
of association, collective bargaining or migrant worker 
rights and, in each case, the parties have resolved the 
issues without having to resort to the adversarial process. 
The issues were thoroughly reviewed by the governments in a 
transparent process that involved public hearings and input. 
There were even, on occasion, direct cabinet-level 
consultations.  That submissions have not proceeded to 
arbitration should not be seen as a failure of the system; 
rather, a non-adversarial, cooperative resolution of a 
grievance is usually the best outcome. 
 
7.  (SBU) Moreover, Karesh explained, labor provisions in 
U.S. FTAs have evolved since the 1994 NAFTA.  Unlike the 
NAFTA, the more recent FTAs include more extensive labor 
protections, incorporate labor rights into the main body of 
the Agreement, and allow labor issues to be adjudicated 
through the conflict resolution process applicable to 
commercial and other disputes.  An important element in all 
the FTAs has been the creation of government-to-government 
institutions and mechanisms.  This has created contacts and 
dialogue that simply did not exist before and can be used to 
address issues before they turn into more severe disputes. 
 
KCTU PROPOSES OPEN MEETING ON LABOR 
----------------------------------- 
 
8.  (SBU) Heo proposed having an "open" meeting where labor 
organizations from both countries and the USTR could have a 
public discussion of an FTA's impact on labor interests.  The 
meeting would take place in the U.S. in connection with Round 
Three of the negotiations in September.  It would be 
important to have a "collective meeting with as many members 
present as possible," added KCTU Director Lee Chang-geun. 
Karesh said that the USTR was always willing to listen to the 
public's concerns, though he said that we would have to 
consider further the details of the meeting.  As two "open" 
meetings in the ROK regarding the FTA disintegrated into 
labor-led violence, there may be concerns regarding safety 
and security.  Lee Chang-geun explained that the meetings 
"broke up" because the government had invited a 
disproportionate number of FTA proponents and distributed 
different amounts of information to the various 
representatives. 
 
WRITTEN DEMANDS AND GRIEVANCES 
------------------------------ 
 
9.  (SBU) The KCTU prepared written objections to the FTA, 
which included the following main points: 
 
-- the FTA negotiations are illegitimate because the ROKG has 
not opened up the process to public comment and input; 
 
-- an FTA would destroy the Korean agricultural industry; 
 
-- an FTA would destroy Korea's social welfare for the 
benefit of U.S. investors; 
 
-- the FTA labor chapter would be unenforceable because it 
would only commit parties to "strive" to achieve the ILO 
labor standards; 
 
-- FTA negotiations should end because the KORUS FTA, like 
NAFTA, would result in suffering by the majority of ordinary 
people in both the U.S. and ROK. 
 
FKTU WANTS TRANSPARENCY, FEARS LABOR MARKET IMPACT 
--------------------------------------------- ----- 
 
10.  (SBU) In a separate meeting, representatives of the more 
moderate Federation of Korean Trade Unions (FKTU) made 
similar procedural and substantive objections, and also 
expressed support for the open meeting proposal described 
above.  Lee Young-deuk, President of the Federation of Korean 
Trade Unions (FKTU), said the ROKG's lack of transparency 
during negotiations has caused the Korean public to lose 
confidence in the government.  He thought it was noteworthy 
that the ROKG negotiators had never met with FKTU, but that 
the USG negotiators had met with them twice.  Lee worried 
that the Korean negotiators were ill-prepared and had created 
a negotiating position without seeking labor's input. 
National Assembly members, who have demonstrated a lack of 
interest and expertise in trade negotiations, could not be 
relied upon to provide effective oversight.  In addition, Lee 
expressed concern that although the FTA might initially 
protect certain labor rights, it would lead to reforms that 
could diminish existing protections for Korean workers. 
 
11.  (SBU) Deputy Secretary General Jeong Kwang-ho added 
that, although it was difficult to discuss FTA provisions 
that they had not seen, NAFTA proved that FTAs were limited 
in their ability to resolve labor issues.  Jeong also feared 
that the FTA was being negotiated too hastily and would lead 
to a worsening of the economy and widespread job losses. 
 
12.  (SBU) Karesh said the U.S. tried to be as open and 
transparent as possible and encouraged FTA partners to do the 
same.  However, he assured the FKTU representatives that the 
confidentiality provisions in place for the KORUS FTA were 
 
SIPDIS 
not unusual and were necessary to facilitate free and candid 
negotiations.  Karesh noted that the ROK negotiators were 
exceptionally well prepared. 
 
13.  (SBU) On worker protections, Karesh explained that 
respect for core labor standards was a key point of all FTAs, 
and for many Members of Congress, it was the fundamental 
point.  Karesh also explained that the FTA would respect not 
only each nation's sovereignty, but also ensure that each 
nation would strive to meet ILO core labor standards. 
Although the KORUS FTA documents were protected by a 
confidentiality agreement, the labor chapter was consistent 
 
SIPDIS 
with other FTAs that focused on the protection of core labor 
standards and carried the philosophy that worker rights must 
be respected regardless of differing cultures or legal 
systems. 
 
FKTU DEMANDS AND GRIEVANCES 
--------------------------- 
 
14.  (SBU) The FKTU provided us with a written list of 
demands and grievances, including the following points: 
 
-- the parties should prepare an evaluation of how the KORUS 
FTA would influence labor rights; 
 
-- the parties should make public all documents subject to 
negotiation; 
 
-- the KORUS FTA should not track the NAFTA, Korea-Chile FTA 
or any other existing FTA; 
 
-- the parties should adopt ILO standards; 
 
-- the ROKG has not allowed the public sufficient opportunity 
to comment on the FTA; 
 
-- the FTA would force the ROK to meet U.S. standards in 
finance, law, consulting, insurance, investment, labor, 
environment, intellectual property rights and other areas of 
ROK public policy; 
 
-- the KORUS FTA would cause the current economic situation 
in the ROK to deteriorate; 
 
-- previous FTA labor chapters do not protect ILO core labor 
standards because they require parties only to "strive" to 
meet the standards; 
 
-- previous labor chapters did not include the right to 
strike because the U.S. sees labor disputes as a barrier to 
free trade; and 
 
-- opening the agriculture market would demolish the 
sovereignty of the ROK. 
 
AFL-CIO NOTES DIVIDE OVER KAESONG 
--------------------------------- 
 
15.  (SBU) Solidarity Center Program Director for Asia and 
Europe Tim Ryan, who was in Korea to lend support to Korean 
anti-FTA activists, told us on July 12 that the AFL-CIO was 
not anti-globalization or anti-free trade.  However, its 
position was to advocate for the inclusion of enforceable 
labor and environmental provisions in all FTAs.  Ryan said 
that the AFL-CIO parted company with its ROK counterparts on 
the issue of the Kaesong Industrial Complex (KIC).  In a 
series of meetings with the KCTU and FKTU, Ryan said that ROK 
unionists refused to discuss KIC as a worker rights issue. 
Rather, the promise of KIC as a precursor to unification 
trumped any inclination to fight for worker rights in the 
KIC.  Korean unions would never come out against KIC based on 
worker rights, Ryan said.  Beyond the KIC, Ryan said that he 
has been trying to get the Korean unions more involved in 
worker rights issues outside the ROK, such as the treatment 
of workers in Korean-owned factories in Central America, 
Southeast Asia and 
elsewhere.  It has been a "long slog," he said, as Korean 
unions have shown little interest. 
 
COMMENT 
------- 
 
16.  (SBU) KCTU's decision to meet with us was probably based 
more on exasperation with the ROKG than on any fundamental 
change in position.  The KCTU representatives, and their more 
moderate brethren at the FKTU, are clearly skeptical that any 
FTA would truly enhance worker rights.  Nevertheless, the 
KCTU meeting itself was an important breakthrough and has 
already led to follow-up discussions between the Embassy and 
the KCTU. 
 
17.  (SBU) The proposed meeting among all labor groups is 
worthy of careful consideration.  Korean labor unions seem to 
have only an elementary understanding of FTA labor 
provisions, and more information might help allay some of 
their misgivings.  That said, we are wary about the proposed 
"open" format.  Despite our good experience on July 13 -- the 
armored vehicles and security guards we brought with us 
turned out to be an overabundance of caution -- the KCTU is a 
volatile group and any uncontrolled meeting with them has the 
potential to degenerate into violence.  If the labor meeting 
takes place, and we think it could be useful, the meeting 
should be kept to a manageable number of union 
representatives. 
VERSHBOW