Getting Ahead in a Changing World

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Getting Ahead in a Changing World

Time flies by and the first year of the millennium has almost gone. It would be useful to think about the issues which will have crucial roles in our economy in the 21st century, a century during which globalization will continue rapidly.

The first issue which comes to mind is the World Trade Organization''s new round of multilateral trade negotiations. Although the launch of the new round has been postponed since the failure of the Seattle WTO ministerial meeting last year, a move to get it started will be made after the new U.S. administration takes over. China''s admission into WTO in the new year will tend to increase the momentum. The upcoming negotiations are likely to tackle environment, labor standards, competition policies and e-commerce in addition to such fixed agendas as agriculture and service industries. The intention is to harmonize these domestic economic issues within a global perspective.

When the new trade system is established, the world economy will be transformed into an arena of competition fiercer than anything seen before. It is important to enhance our people''s understanding and this requires corporate, government and research institutions to prepare appropriate measures to adapt to the changes.

Second, new industries based on information and bioengineering will enter our economy. These future industries, which will have a completely different development process from traditional industries in terms of production, technology and distribution, will become the key to determining national competitiveness and wealth. Countries cultivating the new industries will achieve increasing economic power over those with a long history of clinging to traditional industries. This is why the United States, even though it has led the growth of the Internet, is worried about falling behind Europe and Asia in the new wireless Internet business.

Moreover, developing countries are not necessarily falling behind the industrialized nations in developing new technologies, as we can see in the example of the code division multiple access system used in mobile communication industry in Korea. We must commit ourselves to establishing thorough development strategies in these important new industries and ensure that government, corporate and research institutions cooperate effectively.

Third, we should consider whether a Northeast Asian regional trade agreement, especially one between South Korea, China and Japan, will be established or not. If such a regional trade agreement is established, a new competitive regional cooperative body as strong as the North American Free Trade Agreement and the European Union will be formed and it would reshape the world economy into a triangular power structure.

The outlook for regional cooperation in Northeast Asia has become brighter. China has expanded the scope of its market economy while Japan is reforming its economic structure to escape from long-term stagnation. We have also put our best efforts into implementing market economic principles and inter-Korean relationship has been improved recently. In addition, the Northeast Asian region is the world''s largest market in terms of population and gross domestic product. In these circumstances, cooperation between Korea, China and Japan will certainly create a dynamic market economy in Northeast Asia, which would easily stand comparison with other regions.

It is worrying that while carrying out drastic reforms in our national economy in recent years, we have overlooked middle and long-term problems while focusing too much on short-term problems. We should now look to the future and contemplate how we can cope with these three major issues -- new round of world trade negotiations, new industries and a Northeast Asia regional trade agreement.
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