Next year's G-20 summit to bring S. Korea to world's central stage

By Koh Byung-joon

SEOUL, Dec. 29 (Yonhap) -- The G-20 summit to be held in Seoul next November will likely be an opportunity for South Korea to turn itself into a "rule setter" from its decades-old status of a "rule follower" by joining global efforts to craft post-crisis economic principles, government officials and experts say.

Its spillover impact on Korea will also be significant, as the heads of the
world's most influential 20 countries will gather here, bringing the spotlight to
a country once regarded as one of the poorest countries following a bloody war
six decades ago, they add.
The summit, first launched late last year as the global economy was hurled into
chaos following the collapse of U.S. investment giant Lehman Brothers, has served
as a platform for world leaders to discuss how to survive the worst worldwide
turbulence in decades.
"So far we had only followed or accepted international rules set by other
nations, but now we can wield significant international influence that we have
never enjoyed by becoming a part of governing members in the world that set,
adjust and scrap those rules," said Yoon Deok-ryong, a senior research fellow at
Korea Institute for International Economic Policy.
He added that such an enhanced global status will allow South Korea to swiftly
respond to quickly changing trends in the international economic and financial
markets, while securing a position to reflect its interests in discussions with
other major countries so that it can avoid being sidelined from important
decision-making processes.
The financial crisis that erupted last year showed that advanced nations lack the
ability to bring the tattered global economy back on track without the help of
emerging countries such as China and South Korea, experts say.
The G-20 summit, which was an extension of finance ministers' meetings
established in 1999 among the countries, was first convened late last year. It
has been held three times since, and additional gatherings are scheduled to be
held in Canada and Korea in June and November next year, respectively. South
Korea will co-chair the June meeting and serve as host and chair of the November
gathering.
Many experts now believe South Korea's hosting of the G-20 summit will officially
terminate decades of dominance by the G-8 nations as the influence of the G-20
countries is growing quickly. Their combined population currently accounts for
around two-thirds of the world, with trade and gross domestic product making up
80 percent and 85 percent of the global total, respectively.
"Advanced countries revealed their limit in the process of responding to the
global crisis last year, underscoring the need for emerging countries to increase
their roles. Consensus is building that the G7 or G8 should be replaced by the
larger G20, where South Korea can play a major role in setting rules," said Kim
Hyung-joo, an economist at the LG Economic Research Institute.
"In this sense, the Seoul meeting also carries importance for us, as it will
allow us to make our voice heard in the process of decision-making on the
international stage, a stark difference from the past when it had to follow rules
whether they do harm or not to its economy," Kim added.
Against the seemingly bottomless downturn last year, many emerging countries took
the lead in turning the falling economy around by expanding fiscal spending and
unveiling diverse stimulus measures faster than other advanced countries, a move
that experts say contributed to preventing a longer recession in the global
economy.
As the global economy is now steadily pulling out of the downturn, the G-20
summit next year is expected to focus on how to roll back stimulus measures and
other emergency actions individual countries have taken. It will mainly deal with
how to achieve sustainable growth and narrow the gap between the haves and the
have-nots during the post-crisis era, experts say.
"The G-20 summit in Seoul next November will mainly focus on the push for exit
strategies, achieving sustainable growth, reforming international financial
institutions, and dealing with hefty bonuses given out to employees in the
financial sector while discussing how to secure funds needed for climate change
issues and channel money from advanced countries for the development of poor
nations," a high-ranking finance ministry official said.
The Seoul summit will not only provide a chance for world leaders to prepare for
the post-crisis era, but also give an opportunity for South Korea to enhance its
national status and image in the international community.
An enhanced image and national credibility will help dispel the so-called "Korea
discount" which has caused its stocks and assets to be underestimated due to
geopolitical risks. Experts hope that it could be replaced with the "Korea
premium" that could result in more investments down the road and enhance the
brand power of its products in overseas markets.
"Unlike the somewhat symbolic previous three meetings, next year's G-20 summit
will provide a platform for world leaders to discuss more practical issues
confronting the global economy," a government official said. "A successful
hosting would earn us global recognition, and its impact would be much more than
just hosting the international gathering itself."
kokobj@yna.co.kr
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