Rarely has a newly anointed Korean President fallen so far and so fast. Less than four months into a five-year term, Lee Myung Bak's decision to remove restrictions on U.S. beef has sparked widespread protests over food safety and engulfed his administration in a crisis that threatens a free-trade agreement (FTA) between the two countries. Lee's approval ratings have plunged to new lows, and opposition politicians are planning to boycott Parliament.
It wasn't supposed to happen this way. Lee had strong voter backing after winning a landslide victory in December. On Apr. 18, Lee, eager to cement ties with his country's closest ally, lifted the ban on U.S. beef imports for the first time since it was re-imposed last year. Korea had banned all American beef in 2003 following an outbreak of mad cow disease in the U.S. Seoul briefly allowed in boneless beef from cattle younger than 30 months of age before suspending that last year when bone chips turned up in shipments.
Seoul had hoped to coax the U.S. Congress into ratifying a free-trade accord, which the two governments signed last year. The lifting of the ban came on the eve of Lee's first summit with President George W. Bush in the U.S. in April. Korea was once the third-largest U.S. export market for American beef, with an annual turnover of more than $800 million a year. The on-again, off-again beef ban had fueled opposition to the free-trade pact among key members of the U.S. Congress, including Senate Finance Committee Chairman Max Baucus, from the beef-producing state of Montana. A grand gesture from Seoul might do the trick, was the thinking.
Protests Outside Seoul's Blue HouseSo much for grand gestures. For the past three nights, as many as 60,000 farmers, students, and housewives have demonstrated against the resumption of American beef imports. They have jammed Seoul's streets leading to the Blue House, the presidential residence. Many of them have shouted slogans demanding Lee's ouster for risking public health, and accused the Korean leader of kowtowing to Washington. Some think Seoul could have let in beef from young cattle bred in the U.S. but kept out meat from older cattle, which are more susceptible to mad cow disease. Korea's neighbor Japan bans imports of beef from older cattle.
Lee's loss of popular support has been swifter than anything ever experienced by a Korean President. His approval ratings (BusinessWeek.com, 12/18/07) are now below 20%, down from almost 60% in early March. And a June survey by pollster Korea Research and YTN cable news network has shown that 87% of those polled expressed disappointment with the government's talks with U.S. officials over beef. "We have reached a point where we can't expect much political leadership in Korea," lamented Lee Hahn Koo, a senior member of Parliament from the ruling Grand National Party, on June 9.
Government officials worry that the row could derail the free-trade pact, which experts estimate could boost two-way trade by $20 billion annually. Opposition lawmakers have boycotted a new session of parliament this month, threatening to shelve the trade pact for now. "Given huge political pressures, it would be difficult even for the Korean National Assembly to ratify the FTA unless the beef issue is resolved," says a senior aide to Lee who asked not to be identified.
Rising Inflation Hurting Consumer ConfidenceLee's misfortunes aren't only beef-related. His choice of policymakers, who pushed for export-fueled growth but didn't worry enough about inflation, hasn't helped. Amid soaring oil and material prices, Lee's government allowed the Korean currency, the won, to depreciate by about 10% against the U.S. dollar. That helped propel inflation to a seven-year high of 4.9%. Now with consumer confidence at a low ebb the government faces the prospect of missing its target for 6% economic growth this year. Private economists forecast growth between 4% and 4.9%, compared to last year's 5% growth and 5.1% in 2006.
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