Summers States Korean Winter Far From Over

Lawrence Summers, the U.S deputy secretary of the treasury, arrived in Seoul, on February 25, for a two-day visit as part of a five-nation Asian tour. He held a press conference after attending a breakfast meeting at the Hilton Hotel hosted by the American Chamber of Commerce(AMCHAM). Not surprisingly trade was the subject on everybody's minds.
Summers stated that the U.S. government would be scrutinizing whether South Korea's government subsidizes the steel and semiconductor industries during the course of restructuring.
'There have been some cases in the past when the Korean government supported various industries indirectly through government-run banks,' he said. He added, 'Although we can't identify specific evidence to conclusively say whether the government still subsidizes companies, from now on we will thoroughly monitor any conditions that create unfair competition.'
The deputy secretary issued a stern warning that any notion that the economic recession is over is premature and that Korea still faces numerous challeges.
'Over the last two months there has been a pervasive atmosphere that Korea has rounded the corner and is well on the way to economic recovery. There is a danger of being overly optimistic.'
Summers stated that Korea is not experiencing the last stages of the recession but rather a lull or a false bottom in the economic recession.
He emphasized, 'Chaebol restructuring is stalled and labor disputes will only heighten problems. Workers should understand that the reality of restructuring is that although it is painful, it will actually create more jobs in the long run.'