[TRADING PLACES] Korea finds a rising partnership down under
Craig Pasch: For Woodside, Korea is an important country. It’s one of the few places that we do everything from exploration activities to building our key infrastructure - much of our key offshore infrastructure was either partly or wholly built in Korean shipyards. And Korea is a really fantastic market for crude oil, condensate and LNG, so we participate here in Korea for almost the whole cycle of oil and gas production. And that’s why 11 years ago we opened our office in Seoul.
Kim Woo-sang: I remember Australia had developed the Gorgon project and the Prelude project [off the coast of Northwest Australia] - and if I remember correctly, Japanese companies took a majority stake of the Gorgon project, but the Korea Gas Corporation and Samsung Heavy Industries built the floating LNG platforms for Prelude and Gorgon.
James Choi: It’s a very complementary relationship because Australia has the large offshore gas fields. But we need the technology and infrastructure to extract the gas, and Korea has that technology - Samsung Heavy Industries, Daewoo Heavy Industries, and other facilities that are being manufactured in Geoje.
Australia exported some 51 million tons of LNG from June 2016 to June this year - a record amount, according to consulting agency EnergyQuest. And some 20 percent of Korean LNG imports came from Australia.
Choi: As for the LNG sector, the tariff has been reduced by 3 percent under the Korea-Australia Free Trade Agreement (FTA), and that has led to an increase in LNG exports in the last few years. The most promising area for trade liberalization under the FTA is not only in goods but in services. The area I’d like to highlight is Australia’s financial services sector because that’s where Australia has a very strong comparative advantage. We’re a country of 24 million people but we are the 13th largest economy and have the fifth largest pool of pension funds in the world. It’s because some of the fundamental financial regulatory reforms we implemented in the 1980s have given us a very strong financial sector and skills in managing pension funds.
Choi: Earlier this year, a delegation from the Korean Financial Industry Association (Kofia) went to Australia to further develop linkages on how Korean financial companies could tap into the expertise of Australian financial asset managers, but also to look into Australia’s financial regulatory environment. In October there will be a reciprocal visit by Australia’s finance minister along with a delegation of Australian asset managers to meet with Kofia and Korean counterparts. We’ve already seen some major developments in this sector - Samsung Asset Management announced a $500 million agreement with one of Australia’s senior asset managers, IFM, to establish a global infrastructure investment fund. It was announced about three months ago, and I think it’s quite indicative of the cooperation that could develop between our financial services industries into the future.
Long before he was posted as the Korean ambassador to Australia, the former Ambassador Kim Woo-sang felt that there were always more things Korea and Australia could do together.
Kim: I was always saying that the two countries could develop a middle power role together. Arriving in the country in 2008, I devoted myself to building this middle power cooperation.
Part of his devotion was apparent in a behind-the-scenes story of how the Korea-Australia two-plus-two ministerial meeting, the only one Korea conducts apart from the ministerial meeting with the United States, came to exist.
Kim: President Lee Myung-bak visited Australia in March of 2009, and we signed a joint statement on enhancing security cooperation between the two countries. After that, Prime Minister Julia Gillard visited Korea for a summit meeting. And before she came, she asked me if we are ready to have a two-plus-two foreign minister and defense minister meeting. As I was always promoting more Australia-Korea cooperation, I said that would be a really great idea. I went to see my president and we got to talking, and at some point I told him, “Prime Minister Gillard wants to have a two-plus-two meeting on a regular basis.” I said, “If we ever want a start two-plus-two meeting, we would not do it with Japan at this moment because it may send a wrong message to the great powers in the region. But if we do it with Australia, we could send a very interesting message to the regional powers.” And President Lee liked this idea. That’s how the two-plus-two meeting with Australia started. The first meeting was set up under the Park Geun-hye administration.
Choi: The next two-plus-two meeting between Australia and Korea will be held in October and the Australian defense and foreign ministers will be coming into Korea. They’ll be seeking to further enhance our defense cooperation, building on what we call the blueprint for security cooperation and taking that to the next level in the future.
Kim: But I think more recently, what the region needs is a kind of “minilateral” meeting in the Asia Pacific led by Korea and Australia, because we face together the rise of China and issues such as the South China Sea [territorial dispute]. Some three to five countries in the region could meet and discuss issues and raise our voices together - it would carry more weight.
Choi: What Ambassador Kim may be pointing to is the failure of certain multilateral groupings to address the key global challenges that we face. Whether it be about counter-terrorism or climate change, existing multilateral formats are becoming much more unwieldy. While the major powers may have the luxury of going their own way, middle powers such as Australia and Korea can’t go it alone. We can’t support the international trading system alone, nor can we set international law or guarantee regional security by ourselves. What we need to do is work with other like-minded countries to coordinate our policies, to say that the preservation of the international system that protects our security, trade and economic interests are important. That’s where minilateral groupings will play a much greater role in the future in diplomacy.
Choi: And if you look at like-minded countries, similar-sized economies and countries that believe in the rule of law, free trade and in supporting the international system, Korea and Australia are natural partners. There are very few other countries that share all those values and that sense of value-sharing is what will underpin the future of Korea-Australia cooperation.
Koreans who get Australia
For Ambassador Choi, who has witnessed the rapid transition and growth in Korea year in and out since his initial posting at the embassy in Seoul in the 1990s, it is no surprise that the country is an attractive destination for people all over the world, including from Australia.
Choi: I saw Korea before the Asian financial crisis, from ’95 to ’97. I have been back to Korea quite frequently since then for holidays and for work, and every single time I’ve been amazed with the changes in Korea. Korea has emerged as a major economic power; I don’t think people here in Korea realize how much Korea has changed. Korea is now a sophisticated advanced economy, it’s got an amazing vibrant culture that attracts people - its music, movies, the Hallyu [Korean wave of pop culture], K-pop, K-drama - it really is a magnet for drawing in people, including from Australia.
Choi: While we don’t have as many Australian students coming [as Korean students to Australia], we have established what is called the New Colombo Plan - it’s a plan that was launched in 2013 by my Foreign Minister Julie Bishop. The original Colombo Plan was established in the 1950s to bring people from Asia into Australia so that they could develop skills to take back to their home countries. The New Colombo Plan is the reverse of that - it’s Australian students being encouraged to go to Asia, in recognition of the fact that Asia has now become a major power of economic growth. Korea is one of the target countries. Since it was established we’ve had almost 600 Australian students study in Korea on short term courses and scholarships, so that they can understand Korea much better, hopefully learn some Korean, and get a sense of the Korean way of thinking and the Korean economy so that they become a future link in the bilateral relationship.
Kim: During my tenure in Australia, the number of Korean students on working holiday visas had hit around 40,000. I’ve had many opportunities to talk to the Korean students there. And they’d always ask me, “Ambassador, how would we be able to stay here forever?” I met students from North Gyeongsang and Busan who stayed in Australia for a year and fell in love.
Choi: Around 30,000 Korean students go to Australia to study every year. And I am amazed, especially now, coming back to Seoul on posting this time around, to see the number of people who have studied in Australia working in Korean companies and businesses - they’re mostly in middle-ranking and junior levels and they understand Australia. Some of them speak with a slight Australian accent, which is very encouraging. But they understand Australia and that’s going to be ballast of the future of the bilateral relationship.
Pasch: All of those students who spent time in Australia, when they come back into Korea to work and find an opportunity to do something in their work environment, what’s so important for Australian businesses is that they think about and want to do something with Australian companies. It’s sometimes underestimated how important spending time in each other’s country is, because when you know somewhere and you like it, and you’ve got an opportunity to do something, you could remember a company from that country and give it a call to do something together. Similarly, Australians who spend time here and get a really good understanding of the capacity of Korea, they could get in touch with a Korean company when something has to get done. And it adds a lot of value for the individual and later on for the business-to-business or government-to-government relationship.
BY ESTHER CHUNG [email@example.com]
Australian Ambassador James Choi and Joanne Lee
James Choi was appointed as Australian ambassador to Korea in December 2016, as the first Korean-born Australian ambassador. He was previously a senior advisor at Australia’s Office of Minister for Foreign Affairs, ambassador to Copenhagen and the first secretary and counsellor at the Australian Permanent Mission to the UN in New York. The top envoy’s first posting in Seoul was as the third secretary from 1995 to 1997, where he met his wife, Joanne Lee, who also worked at the embassy at the time. Lee was formerly the public diplomacy officer at the embassy, counsellor at the Australian Department of Industry, Innovation and Science, and first secretary of the Australian Trade and Investment Commission.
Craig Pasch is the country manager and chief representative of Woodside Energy’s Korea office since August 2014. He was previously the government relations manager, project manager for organizational effectiveness and manager of indigenous affairs at the Woodside head office in Perth. In 2015, he was elected onto the Australian Chamber of Commerce (Korea) Board of Directors. Pasch said he enjoys playing golf during his free time here and that one of his most memorable experiences here was a visit to Gapyeong County, where a memorial is erected to remember the Australian forces who fought in the Korean War.
Kim Woo-sang is a professor of political science at Yonsei University. He served as the Korean ambassador to Australia from May 2008 to August 2011 and as the president of the Korea Foundation from March 2012 to May 2013.
Our latest series about the diplomatic community in Seoul, “Trading Places,” focuses on the experience of living in a foreign land. In each installment, an ambassador invites to his or her home a compatriot living in Korea and a Korean who lived in the ambassador’s country. They swap memories - good, bad and amusing - and describe how a distant country that was once an abstraction, a colored patch on a map, became a part of their lives.-Ed.