More than just business

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More than just business

President Park Geun-Hye’s recent state visit to Brazil, Chile, Colombia, and Peru had clear economic intentions: to promote Korean business interests in Latin America. The sheer size of her official delegation of approximately five hundred entrepreneurs indicates that economic interests were at the top of the agenda. However, the timing of President Park’s trip suggests that politics also matter.

Without a doubt, President Park’s trip represents a unique opportunity to strengthen Korean economic ties with Latin America and the timing of the trip seems to have been tactically chosen. President Park wisely sees the downturn of Latin American economies as a window of opportunity to increase Korean economic presence in the region. Also, timing was employed to meet her own domestic interests, as the beginning of her trip coincided with the anniversary of the Sewol ferry disaster.

The first stop of the trip was Colombia, which boasts the third-biggest Latin American economy. As a prosperous economy in the region and a country that needs investment in infrastructure, Colombia looks increasingly attractive for Koreans. The importance of the first stop lay in the fact that it helped President Park put pressure on the Colombian government to be more agile in dealing with strong domestic opposition to an FTA with Korea.

Subsequent stops in Peru and Chile marked a new phase of President Park’s trip: visiting important suppliers of raw materials, mainly copper ore. Although both countries are experiencing an economic slowdown, they are likely to be among the Latin American countries that will grow the most in 2015. Certainly, these reformist economies, with which Korea has already signed FTAs, are most likely to further open their markets for Korean goods and services. In effect, Korea is trying to expand the export of military aircraft from Peru to the rest of the region. In Chile, which signed an FTA with Korea ten years ago, partnership was sought to foster start-up companies, and widen broadcasting and renewable energy cooperation.

Brazil, Korea’s biggest trade partner in South America, was the last leg of the trip. The bilateral talks held in Brasilia focused on the improvement of cooperation on renewable energy, information technology, vocational training and health care. But above all, Korean companies are particularly interested in opportunities to take part in contracts related to infrastructure projects. President Park’s agenda included discussions related to North Korea, since Brazil maintains diplomatic relations with the country.

Taking stock, President Park’s swing through South America certainly was a boost for Korea’s image at a time when most Latin American economies are in need of an economic model that will put them back on the path to high growth. With this trip, it became clear that ties between Korea and Latin America have already been systematically strengthened over time. The Latin American perception of Korea is that it is a nation that embarked on a successful path to fast economic development, one that several Latin American countries hope to emulate. Korea has been making considerable efforts over the past few years to help the region achieve this dream.

However, while President Park’s South American trip accomplished its objectives, it became a domestic fiasco for her. Adding to the growing political unease due to her departure at a time when Koreans were mourning the anniversary of the ferry sinking, the recent denunciations of illegal political donations involving senior officials and politicians close to President Park made the political vacuum she left behind during her official twelve-day trip even more noticeable.

To President Park’s relief, most of her counterparts that she shook hands with during her trip are in some way involved in a corruption scandal. It is true that in comparison, the governance crisis that President Park is currently facing seems to be less acute, but upon her return home she may find that the crisis has been magnified by her absence.

At a time when Korea and several South American countries are facing important governance crises, this trip invites us to reflect on the state of political governance in these countries. Maybe on future state visits between these countries, they might consider discussing ways to improve domestic political governance as an essential element for economic prosperity. After all, Korea and Latin America have a lot to accomplish in this area.

*The author is professor and director of the Department of Latin American Studies of Hankuk University’s Graduate School of International and Area Studies (GSIAS).

by Helder Ferreira do Vale

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