PRESS BULLETIN - March 4, 2009

UNCLAS SEOUL 000339 SIPDIS DEPT FOR EAP/K, EAP/PD, INR/EAP/K AND INR/IL/P TREASURY FOR OASIA/WINGLE USDOC FOR 4430/IEP/OPB/EAP/WGOLICKE STATE PASS USDA ELECTRONICALLY FOR FAS/ITP STATE PASS DOL/ILAB SUDHA HALEY STATE PASS USTR FOR IVES/WEISEL E.O. 12958: N/A TAGS: KPAO PGOV PREL MARR ECON KS US SUBJECT: PRESS BULLETIN - March 4, 2009 Features 1.USTR Hints at Reexamination of the KORUS FTA (Dong-a Ilbo, March 4, 2009, Page 6) Top Headlines Chosun Ilbo Dow Jones Industrial Finishes Below 7,000, 12-Year Low, Sending Global Economy into "Second Financial Shock" JoongAng Ilbo, Hankook Ilbo, Segye Ilbo, Seoul Shinmun, All TVs National Assembly Fails to Pass Bill to Ease Restrictions on Non-financial Businesses' Investment in Local Lenders Dong-a Ilbo National Intelligence Service Conducts Sweeping Reshuffle of Senior Officials Hankyoreh Shinmun Justice Minister: "Anyone Using Violence at National Assembly Will Face Stern Legal Action" Domestic Developments ¶1. The USTR, in a report delivered to Congress last week, said that the Bush Administration left a legacy of numerous pending free trade agreements and negotiations and that the Obama Administration will conduct extensive outreach and discourse with the public on whether these agreements appropriately advance the interests of the U.S. and its trading partners. To some this indicates that the Obama Administration might conduct an overall review of the KORUS FTA. (Dong-a, Hankook, Hankyoreh, Segye, Seoul, all TVs) ¶2. The ROK, during a March 3 meeting of the UN Human Rights Council in Geneva, Switzerland, expressed serious concern over the human rights situation in North Korea, urging the communist state to take necessary measures for improvement. (Chosun, Hankook, Seoul) International News ¶1. According to the Kyodo News Agency, Japan's Defense Minister Yasukazu Hamada said in a March 3 press conference that Japan is ready to shoot down any North Korean rocket headed toward its territory. He was quoted as saying: "If there is a possibility that an object could lose control and drop on Japan, the object becomes our target, including a satellite." (Dong-a) ¶2. The Japanese news agency went on to report that Japan is considering deploying two naval destroyers with high-tech Aegis radar systems and Standard Missile-3 (SM-3) interceptors to the East Sea, in the event that North Korea's preparations for a missile launch become more active. (Chosun) Media Analysis North Korea Citing the Kyodo News Agency, conservative Dong-a Ilbo reported that Japan's Defense Minister Yasukazu Hamada said in a March 3 press conference that Japan is ready to shoot down any North Korean rocket headed toward its territory. The Japanese Defense Minister was quoted as saying: "If there is a possibility that an object could lose control and drop on Japan, the object becomes our target, including a satellite." Conservative Chosun Ilbo, meanwhile, noted another Kyodo News report saying that Tokyo is considering deploying two naval destroyers with high-tech Aegis radar systems and Standard Missile-3 (SM-3) interceptors to the East Sea, in the event that the North's preparations for a missile launch become more active. U.S.-Russia Relations - Missile Defense and Iran Most of the ROK media reported that President Barack Obama sent a s-e-c-r-e-t letter to the Russian President last month suggesting that the U.S. would back off on a new missile defense system in Eastern Europe if Moscow would help to stop Iran from developing nuclear weapons. The media went on to say that the Russian President responded positively, stating: "I expect those (positive) signals from the U.S. will turn into specific proposals." Conservative Chosun Ilbo's headline read: "Spring Wind Blows between the U.S. and Russia." KORUS FTA The ROK media gave wide attention to last week's report by the USTR to Congress, in which the USTR said: "The Bush Administration left a legacy of numerous pending free trade agreements and negotiations. We will conduct extensive outreach and discourse with the public on whether these agreements appropriately advance the interests of the U.S. and its trading partners." Much of the ROK media interpreted this to indicate that the Obama Administration might conduct an overall review of the Korea-U.S. Free Trade Agreement. Features USTR Hints at Reexamination of the KORUS FTA (Dong-a Ilbo, March 4, 2009, Page 6) "The U.S. will conduct extensive outreach and discourse with the public." The Obama Administration said that the Bush Administration left a legacy of numerous pending free trade agreements and negotiations. The new Administration will conduct extensive outreach and discourse with the public on whether these agreements appropriately advance the interests of the U.S. and its trading partners. The office of the U.S. Trade Representative (USTR) made this point in the '2009 Trade Policy Agenda and 2008 Annual Report' with 467 pages submitted to Congress last week. Such a position indicates that the U.S. is willing to gather more opinions from labor unions and related parties. Moreover, some could interpret this to mean that the USTR might reexamine some of the free trade agreements signed under the Bush Administration. The report emphasized that "the Obama Administration will promptly, but responsibly, address the issues surrounding the Colombia, Korea and Panama Free Trade Agreements." The report said that the Obama Administration is developing a plan of action to handle the pending FTAs through consultation with Congress. It also said that the Obama Administration will move relatively quickly on the Panama FTA and will establish benchmarks for progress on the KORUS FTA. The report particularly underscored transparency and social responsibility in dealing with trade pacts. An economic source from Washington said, "President Obama strongly intends that all of the messages he delivered to the Democratic-led Congress and during his presidential campaign should fall under the theme of 'responsibility and transparency.' He also intends that his Administration will strictly apply these themes to pending issues (like examination of previously negotiated FTAs such as the KORUS FTA)." Stephens 1