Korea urged to prepare post-pandemic paradigm

The Korea Times and Hankook Ilbo Chairman Seung Myung-ho delivers welcoming remarks during the Korea Forum 2020 co-hosted by the two dailies at the Shilla Hotel, Seoul, Tuesday. The chairman noted the importance of active discussions among various sectors to come up with effective responses to challenges posed in the post-COVID-19 pandemic world. Korea Times photo by Seo Jae-hoon

By Do Je-hae

Escalating clashes between the United States and China will require Korea to prepare new diplomatic and economic strategies, a former foreign minister said during the Korea Forum co-hosted by The Korea Times and its sister paper, the Hankook Ilbo, Tuesday.

The annual forum was held at The Shilla Seoul hotel under the theme of "Post-pandemic: crisis or opportunity?" with a smaller number of dignitaries present to prevent the spread of COVID-19.

Yoon Young-kwan, who served as foreign affairs and trade minister during the Roh Moo-hyun administration from February 2003 until January 2004, highlighted the need for Korea to shift its economic paradigm to respond to a possible "new Cold War" between the U.S. and China in light of the COVID-19 pandemic.

"So far, Korea has got to where it is by taking active and efficient advantage of the benefits of globalization and free trade. But now we have reached a situation where such a premise can no longer be sustained. Things are now going in the opposite direction," said Yoon, a professor emeritus at Seoul National University's Department of Political Science and International Relations.

Going beyond export-led growth

"That's why we need to revise our past strategy based on globalization. Exports-led growth is also being dented; therefore, the government should strengthen domestic demand and actively push for reshoring. In particular, excessive economic dependence on any particular country is never desirable."

The Korea Times and Hankook Ilbo Chairman Seung Myung-ho, center, and VIP guests look at photos of frontline health workers on display outside the forum's main venue, Tuesday. Prime Minsiter Chung Sye Kyun, left, and Joo Ho-young, floor leader of the main opposition United Future Party, were among some of the VIP guests at the Korea Forum 2020. Korea Times photo by Oh Dae-geun

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The former foreign minister noted that Japan's reshoring policy was a good example. "In Japan, the government supports half of the relocation costs for big companies, and two-thirds for small- and medium-sized firms," Yoon said.

President Moon Jae-in also underlined reshoring as one of the highlights of his economic response for the post COVID-19 pandemic world, aiming to build Korea into a "world factory of high-tech industries" by attracting not just investment from overseas but also helping Korean companies return from abroad. For this to succeed, Yoon underscored the importance of a more flexible labor market and raising Korea's competitiveness in high-tech industries.

"At times like this, our economic system needs to be more flexible and efficient. It should not be rigid. That's why we need labor reform and improvement in corporate governance. Only then, can we induce large companies to return and create jobs here. At the same time, efforts should be made to secure several outstanding industrial sectors that the world envies and only Korea has."

Careful approach to US-China conflict

The scholar also advised Korea to take a cautious diplomatic approach in dealing with pressure from the rising U.S.-China tension.

"There will be increasing pressure from both sides," Yoon said. "We need a principled approach based on transparency and rationality. Also, Korea should separate Korean Peninsula issues from the U.S.-China conflict as much as it can."

He also proposed the government focus on certain cooperative issues with North Korea, such as on health matters related to COVID-19, as a realistic measure to improve inter-Korean ties.

"Rather than pushing for various economic projects, we should pick and choose, such as health and medical cooperation. Korea's global image is very good due to its successful quarantine drive and medical diplomacy, so this is a good time to convince the U.S. and the international community."

Former foreign minister Yoon Young-kwan, professor emeritus of Seoul National University, speaks at the Korea Forum 2020, Tuesday. Korea Times photo by Seo Jae-hoon

The Korea Forum 2020 gathered experts from academia, business and government to discuss various challenges posed by the COVID-19 pandemic.

"Now we must prepare for the changes expected after the pandemic. The immediate concern is to control the COVID-19 spread and tackle the employment crisis faced by individuals, and bankruptcy of companies," said Seung Myung-ho, chairman of The Korea Times and the Hankook Ilbo. "The government, politicians, scholars and civic society need to put their heads together to turn this crisis into an opportunity."

Prime Minister Chung Sye-kyun was among dignitaries who took part in the event. "The escalation of the U.S.-China conflict is raising concerns of a new Cold War," Chung said. "This is a crisis for our economy which is highly dependent on external factors. But through COVID-19, we have reaffirmed our potential and capabilities."