(EDITORIAL from the Korea Herald on Nov. 18) - After G20 summit

President Lee Myung-bak's distinct role at the G20 summit in Washington last week and South Korea's inclusion in the "troika" that will preside over the implementation of agreements at the emergency financial meeting must give Seoul a little more confidence in overcoming the global financial crisis.

Korea, which just 10 years ago was on the brink of state default and had to take
an IMF bailout, should now prepare steps to stave off the global monetary and
economic disaster in collaboration with co-chairs Brazil and Britain. As finance
officials here observe, the task is both "a heavy challenge and a great
opportunity."
People in the government and industry have learned a lot from the 1997-98 turmoil
and financial institutions have become stronger after painful restructuring. As
the nation's economy is shaken by the international financial meltdown,
economists attribute the steep decline of both stock prices and currency value to
the local market's loss of confidence in the government's crisis-management
capabilities.
It is unfortunate that the Lee administration was dealt a financial blow as soon
as it staggered out of the turbulent summer of U.S. beef protests. Public blame
was immediately directed at the new government for mishandling the situation. The
G20 summit, to which President Bush invited 20 of the world's largest economies,
including South Korea, gave respite to President Lee, who faced mounting calls to
dump his top economic aide, Finance Minister Kang Man-soo.
In Washington, President Lee raised his voice as a representative of the emerging
market countries which have born the brunt of the financial crisis. In his
keynote speech, Lee asked for currency swap lines between advanced and developing
economies and urged his counterparts to pledge not to create trade and investment
barriers. His call for an early conclusion of the Doha agreement for a universal
free trade regime was included in the joint communique from the two-day summit.
President Lee was speaking up for emerging economies, including China, India and
Brazil, whose leaders were also present at the summit. He warned richer nations
against resorting to protectionism, which he said would make the global economy
more susceptible to recession. He further demanded that global leaders agree on a
"stand-still" declaration to pledge not to create new barriers to trade and
investment.
The chairmanship of the G20 rotates among all members. Korea, which is to become
the chair in 2010, joined Brazil and Britain, the chairs for this and next year,
to play a leading role in the new assembly of nations. They will assume the grave
task of steering the world out of its worst-ever financial crisis. That
responsibility must add some weight to President Lee's appeals to other
participants.
The 47 action plans adopted in Washington are diverse and complicated, as they
seek to correct the defects of global financial system through closer cooperation
on regulations, standardization of accounting rules, strict oversight on
credit-rating agencies and other practical steps. For the next two years, Seoul
should perform its task faithfully to win the trust of global economic players.
An immediate test will be the next G20 summit in April.
Korea, a victim of the disaster, is to join the firefighting team. President Lee
and our financial bureaucrats now need to directly link domestic policies to
follow-up measures for the G20 agreements. This is an opportunity for our
government to accelerate the process of elevating its economic operations to
global standards. No blunders will be allowed.
(END)