Obama, South Korea's Lee to talk trade, North Korea strategy

Reuters News

10/13/2011 1:18:53 AM - Reuters News

By Matt Spetalnick

WASHINGTON (Reuters) - President Barack Obama and South Korean President Lee Myung-bak will bask in the glow of congressional approval of a long-delayed trade deal and coordinate strategy on the North Korean nuclear standoff when they hold talks on Thursday.

Hosting Lee amid the pomp of a formal state visit, Obama is looking to underscore what is widely seen as a high point in the longtime alliance between Washington and Seoul as well as his ever-closer personal bond with the South Korean leader.

The top item on the agenda will be the consummation of a U.S.-Korea trade pact, which is expected to help anchor the United States in the economically dynamic Asia Pacific region as it competes with an increasingly assertive China.

Just hours after Lee's arrival on Wednesday, Congress ratified the deal. It was the largest of three pending bilateral agreements, including pacts with Colombia and Panama, all passed in rapid succession.

Obama -- who sent the pacts to Capitol Hill nine days ago, four to five years after they were negotiated -- hailed their passage as a "major win for American workers and businesses." South Korea's parliament is still debating the issue.

Obama has touted the accords as a way to boost U.S. exports and create tens of thousands of jobs at home at a time when his 2012 re-election chances likely hinge on whether he can reduce an unemployment rate stuck above 9 percent. But some critics say the pacts will actually hurt U.S. employment.

The deal between the United States and South Korea, the world's largest and 14th largest economies, would be the biggest U.S. trade pact since the North American Free Trade Agreement went into effect nearly 18 years ago.

NORTH KOREA ON THE AGENDA

Lee has proved a reliable partner for Obama, lining up with U.S. policy on North Korea, Afghanistan and the G-20 summit aimed at stabilizing the world economy.

But South Korea had chafed over U.S. delays getting the trade deal passed. It was signed under President George W. Bush in 2007 but until now remained stalled under Obama, partly due to renegotiation of auto provisions to get a better deal for U.S. car makers.

Despite that, Lee -- whose mandatory single term ends in early 2013 -- has managed to build personal chemistry with a U.S. president known for a mostly detached diplomatic style.

Obama has faced criticism in some foreign policy circles for failing to cultivate chummier ties with foreign leaders like his predecessors, Bush and Bill Clinton, did.

Lee, who dined with Obama at a Korean restaurant outside Washington on Wednesday, will be feted on a rare state visit with a red-carpet arrival ceremony, a joint news conference, an address to Congress and an elegant White House dinner.

Obama will then take him on Friday for a road trip to Detroit, home of the U.S. auto industry.

In talks on Thursday, the two are also expected to try to keep a united front on North Korea's disputed nuclear program.

It is a stark reminder that Iran is not the only nuclear standoff that has continued to dog the Obama administration. Relations with Tehran are under new strain over U.S. accusations this week that Iranian officials backed an alleged plot to assassinate the Saudi ambassador in Washington.

Obama and Lee are likely to consider whether efforts to re-engage with Pyongyang are worth pursuing further.

Seoul's ties with the isolated North soured after Lee took office in 2008 with a pledge to link aid to progress in U.S.-led efforts to end North Korea's nuclear programs.

Ties between the two Koreas further deteriorated after the North's deadly attacks on the South last year -- the sinking of a South Korean warship and the shelling of an island.

The provocations by the North, which walked away from six-country nuclear talks and conducted its second nuclear test in 2009, helped bring Washington and Seoul closer together.

Recent conciliatory gestures by both Koreas have raised hopes for an opening to restart nuclear negotiations, but Seoul and Washington insist Pyongyang must first take concrete measures to disable its atomic facilities.

(Additional reporting by Paul Eckert and Doug Palmer. Editing by Christopher Wilson)