Reputation rebuilding

The global order has increasingly become multi-polarized with the faltering of U.S. power in this century. The economies in the western hemisphere are still recovering from Wall Street’s crash in 2008. The emerging markets contribute more to driving growth in the global economy, accelerating the realignment of the architecture of global governance. Asia is at the center of the ongoing evolution. China is expected to account for 17 percent of this year’s global gross domestic product in terms of purchasing power, outperforming the U.S. and European Union. India’s share is estimated at 7.1 percent, Japan’s 4.3 percent and South Korea’s 1.6 percent. Overall, Asia would make up for nearly two-fifths of the world economy.

China’s assertiveness and influence is rising as fast as its economic heft. Beijing embarked on the so-called One Road, One Belt initiative and established a funding organization, the Asian Infrastructure Investment Bank (AIIB), to connect Asia with Europe over land and Africa via the sea. The ambitious project is designed to change the landscape of the global economic order, which was dominated by the West. China is campaigning to have its currency, the renminbi, part of the International Monetary Fund’s (IMF) Special Drawing Right, the composite reserve currency used in official financing, with the ultimate goal of challenging the dollar’s supremacy in world trade.

The U.S. and Japan have formed a united front against China on the trade frontier via the Trans-Pacific Partnership (TPP). Through the Asian Development Bank, where they have held the majority shareholders’ position for the last half of the century, the U.S. and Japan plan to invest $110 billion in Asian infrastructure developments over the next five years. India has made big strides on the economic front helped by a reform drive by Prime Minister Narendra Modi, who took office last year. The country is also rapidly mending ties with regional countries to boost trade and economic cooperation.

A middle-income and small country like Korea cannot wield much influence on the global stage. But it can silently work behind the scenes through alliances with other countries because it does not pose a big a threat like global powers. Korea has advantages to exercising leadership. It has achieved stunning economic progress and a democracy over a short period of time. It has a rich history and culture and is advanced in technology and innovation. It is also rich in human resources. Overall, its global reputation is as good as any other advanced nation. Korea was able to produce a secretary general for the United Nations and host the G-20 summit for the first time in Asia because Korea’s image fits well with the changes in the geopolitical order.

But Korea’s position on the global stage is challenged these days. Korea is largely peripheral in the ongoing contest in the region: a hegemonic power game between the U.S. and China and Japan and China. Korea is further pushed aside as more and more developing economies rise in the region. Korea has lost its deputy governorship to China, India, Australia and Indonesia. Its rank on the national competiveness scale is declining and the country has shown itself to be sloppy in dealing with major crises. The reputation the country has built is crumbling.

Korea needs a national agenda to restore its reputation. Korea once was a model for the developing world for its fast rags-to-riches economic success, becoming a donor of aid since 2010. All this was possible because of economic prosperity and social development. Korea, however, is stumbling in the face of challenges common to an advanced society: an aging population, the need for innovation and economic reform, income inequalities and social conflict. The country is in urgent need of some national vision to reinvigorate the economy and unite the society.

We should encourage bright Koreans to find jobs in foreign companies, international organizations or nonprofit organizations and draw foreign students to our universities to build a network of human relationships with a fond attachment for Korea at their cores. Korean software content like films and TV shows, music, games and sports have helped boost the national image. The government should do more for their promotion. Hosting international events including the 2018 Pyeongchang Winter Olympic Games will do a lot to bolster the national reputation.

Korea’s diplomatic capabilities should be strengthened. While tending to bilateral relationships with the U.S., China, Japan and Russia, the country should cement ties on the multilateral level by establishing cooperative systems between Korea, China and Japan, strengthening alliances with Southeast Asian countries, and playing the constructive middleman role between advanced and emerging countries on the international stage. The government should re-examine its diplomatic strategy and resources to build an effective incubating system to foster Korean representatives with expertise on our culture, history and society.

James Monroe, the fifth president of the United States, said, “National honor is the national property of the highest value.” Korea should build the country’s credentials as an advanced nation through constructive public policies and diplomatic capabilities in partnerships with other Asian countries. We must be well-prepared to achieve our higher goal of bringing unification to our land.

JoongAng Ilbo, June 12, Page 31

The author is an economics professor at Korea University.

by Lee Jong-hwa