Go to contents

Dialog between president & opposition leader

Posted October. 10, 2000 15:13,   


Lee Hoi-Chang (Grand National Party leader): While the people are worrying about a second economic crisis, President Kim and his economic aides keep saying that there is little to worry about regarding the economy. The restructuring endeavor has failed.

There must be a major turnaround in economic policy. It was a grave mistake to address the failure of Daewoo Group in August 1999 having wasted more than one year dilly-dallying over its fate. Nobody in the domestic market would believe what the president says. How to dispose of Daewoo Motor and Hanbo Steel will test the ability of the Kim administration.

The financial pinch of Hyundai Group should be taken seriously. A frontal attack is in order without papering it over. Hyundai must wash its hands of its projects in North Korea. Initiation of such a policy as deposit insurance should wait until the banking sector becomes more stable.

President Kim Dae-Jung: I do not think it an economic crisis. It calls for caution and discretion.

When the foreign exchange panic came to require an IMF bailout in 1997 the then government did not say it was a crisis. Internal and external conditions combined to aggravate our economy. Delay of over one year worsened the plight of Daewoo Group, and the government was slow in making a decision. (Daewoo) Chairman Kim Woo-Choong's failure to heed the counsel complicated the trouble.

I will keep tabs on the 12 items in the four major categories of reform every month. Restructuring of the banking sector will be completed by the end of December. Counsel for slow but steady effort is understandable, but further delay will only increase the loss.

The present government is suffering greatly from the problem of ailing Hanbo Steel, for which the previous government is responsible.

I am attacking the question of Hyundai in a straightforward way. The government also thinks it desirable that the group operates within its proper means.

Government approval of investment projects in the North should be so geared as to keep any enterprise within proper bounds.

Postponement of the introduction of partial deposit insurance is being weighed from many angles.

Lee: Our party will act on the government-proposed bills on financial holding companies and minimum wage; so I can ask you to pass bills presented by the GNP. Bills on national debt, special measure for reduction of fiscal deficits and special legal arrangement to assist North Korea need to be passed.

Kim: I appreciate that. I will try to fully negotiate on the legislation promoted by the opposition party. The policy consultation meeting (agreed on previously) ought to be reactivated toward that end.

Lee: Public funds are the blood of the people. Earlier this year when my party raised the questions of national debt and fiscal deficit, and called for public funds the president and the government said no. Following the election they said 30 trillion won is required and it could be recovered for reuse. Then, they ate their words to claim 50 trillion won in public funds for infusion into the bailout.

We've got to carry out a parliamentary inspection and trace the basis of the request and find who is to blame. The president is supposed to present himself before the National Assembly and explain it to the people. You should apologize to the people for their suffering.

Kim: I feel sorry for the people and the opposition. As it turned out, the (government's) words changed from time to time. The outbreak of Daewoo's collapse came to necessitate more public funds, as 64 trillion won was being spent to deal with the contingency. The National Assembly might well deliberate on and approve the generation of public funds. Funds so put into bailout could be retrieved by selling off government holdings when restructuring is finished and stock prices pick up.

Lee: You make too much haste in inter-Korean affairs. Priorities and timing seem to be indiscriminate. Some people see that it is as if you are in a hurry to achieve everything during your term of office.

Kim: Some items are undertaken all at once because they came about for the first time in 55 years. Yet I am not rushing things, and making haste might not pay.

Lee: Seoul almost begged for a meeting of defense ministers. No headway was made toward a general relaxation of tension, and the linking of Kyongui cross-border rail line is the only thing that was agreed on.

Kim: The defense chiefs reached a broad accord on avoiding future wars and implementing the June 15 joint declaration. It thus carries great significance. It was also agreed for the armies of two Koreas to work together to rebuild the severed railway. More progress is to be made in the second round of defense ministers' talks.

Lee: Too much aid for North Korea and excessive investment in the North ought not to impose a heavy burden upon our economy. The financial difficulty of Hyundai must not be allowed to create further burden on the Korean economy.

Kim: They should be made within the scope of a budget prescribed by the government -- this is the principle. As some of the Hyundai projects are worrisome, I have reserved approval.

Lee: It is unfair for the South not to bring up the issue of repatriating Southern prisoners of war from the North now that we have sent back North Korean agents who were convicted and have served their sentences here.

Kim: In terms of legal theory the point at issue is complicated and rickety. The crux of the matter is humanitarian resolution of the question for eventual return and reunion with their families. The government is trying to make it come about without getting hung up on polemics.

Lee: It should not be treated like that, we must demand their repatriation. I do not oppose humanitarian assistance to North Korea. Vast quantities of aid will continue to be required, and they should be preceded by examination of the present food situation in the North, the possibility of structural reform of North Korean agriculture and the state of our own economy.

Kim: I considered all these things, and the upswing in grain prices made it more difficult.

Lee: North Korea proposed a ¡°lower level of confederation,¡± and the presidential office declared that the June 15 declaration took a step forward toward reunion. I am concerned if the incumbent government is taking it too easy.

Kim: (Referring to the remarks of North Korean leader Kim Jong-Il) Pyongyang no doubt is in favor of an inter-Korean confederation. It was a big positive development that the North pulled back from demanding the withdrawal of American forces and left the proposed change to the National Security Law up to the decision of the South.

Pyongyang's relations with Washington are looking up, and it is likely to help improve its ties with Japan; then the relations of South Korea, the United States and Japan with North Korea will improve overall. Loans to North Korea from such international organizations as the IMF and the IBRD will be possible, and investment is bound to increase. Then, our burden will become less heavy.

Confederation will vest the central government with the powers of diplomacy and defense. But a lower level of confederation is quite dissimilar from that -- remote from federation. In the course of further negotiations I will consult the opposition party. There might come a situation calling for a national referendum.

Song In-Soo issong@donga.com