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I. Introduction
Korea is world's 12th largest country in terms of trade volume and more than 70
percent of its GDP comes from foreign trade. Despite of heavy dependence on foreign trade,
Korea is often accused of being protectionist. This accusation from abroad is often exaggerated.
In fact, after 1998 IMF bail-out program, Korea's markets including capital, service and trade
have been significantly opened. However, the accusation is not totally groundless either. Even
nowadays domestic market for some goods including steel, semiconductor, rice and film are
target of pressure for further opening from foreign producers and international economic
institutions such as WTO. Especially, recent episode of trade negotiations involving rice, fruits
and films shows that protectionist tendency remain strong in Korea. Although Korea
government repeatedly pledges its commitment to free trade its trading partners are still
suspicious about Korea’s commitment to free trade.
The Korea-Chile FTA negotiation and ratification process show that protectionist
tendency overshadowed the entire process. Several commodities - apples and pears for Chile
and freezer and washing machine for Korea- which both countries were especially interested in
were excluded from the tariff elimination list mainly due to the strong opposition of Korean
agricultural sector. In the end two parties settled for agreement which fails to realize the
economic potential of the FTA. The ratification process took a year and finalized at fourth trial.
Moreover, the Korean government, in order to ratify the agreement, promised huge
compensation to agricultural sector which had been a major huddle during the negotiation and
ratification process. Although the goal itself was for trade liberalization, the outcome only
confirmed the presence strong protectionism in Korea.
Why is Korea still protectionist even though Korean government seems to fully accept
free trade principle? The previous studies on trade policy could give us some clues. First of all,
the role of ideas or shared beliefs can be a good explanation to the protectionist tendency in
Korea. Some might argue that protectionist ideas are still prevail and influence Korea’s trade
policy. However, to my knowledge no government officials of Korea ever publicly endorse
protectionism. Instead, Korea is strong proponent of free trade and actually is involved in
multilateral free trade regime. Thus, more accurate observation is that Korean government is
fully committed to a liberal free trade regime while actual trade policies are still have
protectionist elements. How can we explain this contradiction? We need other explanations.
There is a possibility that regardless of government’s official stance mass sentiment or culture is
protectionist. This position might argue, although the government stance is pro-free trade, the
culture or mass idea is dominantly protectionist. This protectionist culture, in one way or
another, influences the Korea’ trade policy. This explanation, however, need to explain how the
Convention