&#91FORUM&#93The rivals are outside our border

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&#91FORUM&#93The rivals are outside our border

Last autumn I heard Lee Kuan Yew, the former prime minister of Singapore, make a statement in half-admiration and half-lament, “Observe the Chinese students who’ve come to study in Singapore on scholarships. Hardly have they arrived and they have already become the top of their classes, surpassing our native students. If this is the potential of China then no one can stop its high-speed growth and expansion of international influence.”
Chinese are not only doing well in studying, they have caught up with their competitors in economic fields. China surpassed Korea in its market share in the United States a long time ago, and in the first half of this year it has taken 11 percent of the U.S. market, nearly four times Korea’s share. It has passed us in automobile production to become the world’s number five, and is fast on our heels in the ship-making industry in which Korea now leads. Attracted by the possibilities and the favorable investment environment of the Chinese economy, foreign capital has gushed into the Middle King-dom. Foreign direct investment in China reached 448 billion dollars last year, over 10 times the flows to Korea.
In contrast to the dynamic Chinese economy, our economy continues to contract. The gross doemstic product growth rate for the second quarter was 1.9 percent, the lowest in four-and-a-half years. Calculated in terms of national income, which reflects the deteriorating terms of trade we face, our economy contracted in the first half of the year. While the economy backtracks, young people who have finished their studies are frantically looking for jobs. The economy is near a crisis now, but there are many who worry that the future might be even bleaker.
Our people, businesses and economy still possess great potential. If given the chance, we would not be left behind by China without a fight. It is the duty of those in power to create an environment for our people to restore vitality and enthusiasm and use their abilities in full.
One thing we also have to take into consideration is China’s recent warning to North Korea. According to a CNN report, Chinese President Hu Jintao told Kim Jong-il to stop his endless preparations for war and concentrate on reviving the economy.
The political leader of South Korea must also heed this warning because preparations for exhaustive wars are at their height here too. To exaggerate, there are two kinds of “wars” going on here, one for the general elections next year and one between labor and management.
So long as the government neglects its duties in favor of partisan preparations for the elections, it will be hard to expect any framing or implementation of policies helping the long-term economic recovery. Certain high-ranking officials have already announced their intention to run in the elections, and have shown more interest in politics than in administration. Policies that are announced under such circumstances could be more detrimental than helpful to the future development of our country. There are also cases of flashy slogans being put forward without any action to follow up on them.
With such economic hardships, it would be desirable for the president to put his ambitions for the general elections aside and concentrate on the economy.
If the president refrained from making any comments that would bring confusion and conflict, worked in earnest to bring about an economic recovery and set policies toward that goal, the people would follow his lead. Should he take such a position, he would not have to worry about whether the elections turned out to give him a majority or minority in the National Assembly.
The government should also take on the role of mediator based on law and principles in the conflict between labor and management. By strengthening its neutral stance, the government could maximize its efforts to bring a swift solution to the current labor woes.
What President Roh Moo-hyun must keep in mind is that his rival is not the opposition leader, certain newspapers, labor unions or business management. His rivals are Hu Jintao of China, Prime Minister Junichiro Koizumi of Japan, Prime Minister Goh Chok-tong of Singapore and Prime Minister Mahathir of Malaysia.
According to this kind of scorekeeping, the game is won or lost on economic points.

By Ro Sung-tae

The writer is director of the JoongAng Ilbo Economic Research Institute.
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