!!!!! http://www.energyplus.or.kr/ !!!!!
Home   About KPI&BCS.com
Korea Gov't News

MKE News

e-Marketplace Publication                 W
write
http://www.energyplus.or.kr/
  Domestic Media Link
- Korea Times  
- Korea Herald  
- Joongang Daily  
- Dong-A Ilbo  
- Chosun Ilbo  
- Joongang Daily  
- Arirang TV  
- MBC  
- KBS  
- SBS  
- Maeil Business  
- Ajoo Business  
- Financial News  
- Newswire  
· Korea Times
· KOREA IT TIMES
· ISO
· korea herald
· EBN산업뉴스
· Go20:Google
· Alibaba
· 한국경제신문
· MOFCOM
· Xinhua News Agency
· Newsformation공공기관
· Central Gov't
· WIN
· KSP
 
 
    Global Outreach  
 

- Summit Meetings

 
  - G20 Summit  
  - ODA  
  - Countries  
  - Others  
     
G-20 finance ministers in Busan   

main

By Lee Chang-sup

A hair-trigger inter-Korean confrontation stole the limelight from the meeting today of the G-20 finance ministers and governors of the central banks in Busan. Korea, once a shrimp in the world, is hosting the event to coordinate, bridge and balance differences in the global economy, and the financial architecture among the G-20 whales.

In the meeting, participants will shortlist agenda items for the summits of G-20 leaders in Canada later this month and in Korea in November. They will seek a consensus on exit strategies, global financial re-regulations, fiscal discipline and a sustainable development model.

The participants' decisions will have a more far-reaching impact on the world economy and the financial market than those of the G20 leaders. They will work out details for a more prosperous global economy and financial market. Their leaders will then endorse what they agree to at their summits in Canada and in Korea.

The global economic situation is so precarious that the participants are in no mood to use the Busan meeting as just a photo session. It is inadvisable to produce a lengthy arcane communiqu? featuring such pointless abstract words as cooperation.

The U.S. economic recovery is still fragile; and profligate welfare spending has drained state coffers in the euro zone, especially Greece, while Asian economies, including China, India and Korea, are slowly moving out of the Lehman-triggered global economic downturn.

The attendees are pressed to specify initiatives to protect the global economy from any future unprecedented crisis. Few deny that this is a period of crisis for capitalism. Strategy and Finance Minister Yoon Jeung-hyun has enough reason to be proud of hosting the prestigious get-together. However, Yoon and his deputies are pressed to look inward to guide Korea out of these turbulent global economic times.

First, Korea needs bold financial deregulation even though other G-20 countries, including the United States, will seek re-regulation. It is a luxury to talk about regulating Seoul's nascent derivatives market. Unlike Korea, major G-20 countries do not meddle in the personnel management of private banks ― the reality here is that the government sometimes mobilizes administrative tools to kick out a recalcitrant CEO of a private bank.

The selection of the chairman of the KB Financial Group this month will be a litmus test on whether bureaucrats shed their nostalgia for government-controlled finance. Yoon fudged the issue.

In February, he ruled out the possibility that either a former or incumbent government official will head the nation's largest financial group. Last month, he suddenly changed his mind and hinted that no one should be selected for the job without an endorsement from the government.

Second, Korea can advocate global financial reform that does not incur costs for consumers. Costly banking re-regulation may stifle the creativity of entrepreneurs and burden borrowers.

Third, the participants will establish a consensus that the dynamism of the real economy is crucial to saving the troubled world economy. The "money economy," namely finance, should not be placed ahead of the real economy ― finance should exist to fuel it.

Any chances of the money economy disrupting the real economy must be removed, as an economy without a sustainable manufacturing base will surely fail. Thus, capital controls are justifiable to protect the economy. Korea learned a painful and costly lesson from the 1997 financial crisis, when a sudden and massive capital outflow shook the foundations of the then fragile economy.

The trouble confronting the United States is that the money economy, which produces nothing tangible, prevailed over the real economy for too long. Trillions of dollars of paper transactions create the illusion that the economy is booming. This is fantasy. In the real economy, tangible products are made and traded.

Fourth, the meeting will be an occasion for rethinking globalization. Globalization looks inevitable but the income gap is widening between the haves and the have-nots, and so it will be reassuring if the participants discuss such issues as inclusive financing.

Fifth, the world is watching whether the G-20 specifies a reform plan for the world's three international rating agencies so that their ratings will be fair, transparent and convincing. Seoul also needs to look at local rating agencies critically.

Sixth, the International Monetary Fund (IMF) and the World Bank need to do more homework to help the global economy get on a solid and sustainable track. Their free market rhetoric looks hollow when they do not provide alternative policies for a sustainable global economy.

Seventh, the Busan meeting is also an occasion for Seoul's policymakers to seek ways of reforming the services sector for growth. The Organization for Economic Cooperation and Development has pointed out that Korea's services-sector reform will fuel growth.

Eighth, the recent downturn in property prices is also a cause for concern. A double-digit fall in home prices will strain heavily-indebted consumers.

Currently, construction firms and a few community-based savings banks await painful restructuring for their misguided heavy lending to the property market. If left unchecked, they will trigger a mini-financial crisis similar to the one Korea encountered during the LG Card trouble in 2002.

Ninth, Korea is credited for taking quick and decisive steps, including bold fiscal stimulus and interest rate cuts since late 2008. In view of the precarious economic recovery and the emerging euro zone troubles, global exit strategies need to be well-coordinated, slow and prudent among the G-20 countries.

Finally and hopefully, the G-20's condemnation of North Korea's torpedoing of a South Korean warship will send a reassuring message to stock and currency markets worldwide.

modify목록   
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

 
 
Copyright ⓒ BCS.COM All rights reserved.
Tel : 02-6258-7870~3 / FAX : 02-6258-7877e-Mail : btsbj@chol.com
3Fl., Jiseung Bldg., 419-6 Dogok-Dong, Gangnam-gu, Seoul 135-854, Korea