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[Editorial] So What Should Pres. Lee Do Now?

Posted November. 22, 2008 09:32,   


President Lee Myung-bak will return to Korea Wednesday after a 12-day overseas visit. His final destination on this trip is Lima, the capital of Peru, where he will attend the Asia-Pacific Economic Cooperation summit over the weekend. His unprecedented long visit shows his strong will to find measures to overcome the global economic crisis, while participating in the G20 financial summit. Upon arriving at Gimpo International Airport in Seoul, however, Lee should face the bitter reality Korea is now facing. What should he do to tackle mounting difficulties?

In a dinner with the economic mission accompanying him, President Lee said, “Given recent developments, I believe Korea will be the first to overcome the crisis.” Undeniably, it is good for him to regain confidence to weather the economic crisis by visiting other nations. Confidence, however, is not enough to tackle the mounting difficulties. As the financial crisis has spread to the real economy, the world is afraid of deflation. Worse news broke out yesterday that the world’s biggest financial group Citigroup is considering selling off its business sectors partially or wholly.

Korea is no different. The country’s foreign exchange reserves and liquidity have improved since late last month, but no money has flowed in the market. The won has plummeted to 1,500 to the dollar, the lowest in a decade. Moreover, the plan to rescue and restructure cash-strapped builders has not progressed since the government and banks have sought to pass on the burden to each other. Making matters worse, the government has lowered its economic forecast for next year to between 2.5-2.9 percent. Instead of creating jobs, corporations are considering downsizing. Foreign experts warn that Korea faces bigger challenges.

Despite this, the government has yet to provide effective measures. Restructuring is not an option, but a must. The government has not aggressively pursued restructuring, however. Though it injected a large amount of money into the market, it has failed to encourage commercial banks to lower market interest rates. The government and the ruling party have shown a lack of determination, while failing to achieve deregulation in the Seoul metropolitan area and revise the comprehensive property tax.

Against this backdrop, President Lee should stand at the center of the crisis, which should neither be exaggerated nor overlooked. His official statements Lee made in other nations do not cover the substance of Korea’s crisis. President Lee should delve into the core of the crisis. Koreans urgently need insight and leadership from a leader who can inspire strong confidence in the people and the market.