The upcoming G-20 Summit in Seoul and its agenda

  • 2010-11-08
  • By Cho, Hee-yong, Ambassador of the Republic of Korea to the Republic of Latvia

Next year marks the 20th anniversary of diplomatic ties between the Baltic States and the Republic of Korea. Over the past two decades, the relations have been consistently improving, as evidenced by a remarkable growth in the bilateral trade volume and the rising number of exchanges between Korea and each of the Baltic States. Despite the geographical distance, the Baltic States and Korea share common interests and with the landmark Korea-EU Free Trade Agreement coming into effect next July, the overall relationship is expected to deepen even further. In addition, both Korea and the Baltic States are liberal democracies and market economies with high aspirations to become regional logistic hubs and more than that in the future.

As ambassador of Korea to Latvia, I am pleased to inform that Seoul will host the historic G-20 Summit Meeting on November 11-12, and I hope that the Baltic States and its people, based upon its two decades of excellent record of cooperation with Korea and its people, will support the Korean government’s efforts to make significant progress in the global premier forum.

For Korea and its 50 million people, with Korean President LEE Myung-bak presiding over the upcoming global premier forum in Seoul, the forum is an event of historical proportions in itself and also represents Korea’s major leap forward into the international spotlight, claiming its rightful place due to its economic standing and achievement.

As the very first non G-7 nation to host the G-20 Summit Meeting, Korea touts itself as having secured a unique position. Within a few decades following the Korean War in the early 1950s, Korea has managed to transform itself from a very poor country, that is to say the least, to a vibrant economic powerhouse.

During the transition of its rapid economic development, the country fell victim to the major financial crisis sweeping over Asia in the late 90s and had to rely on IMF-led emergency credit facilities. Now Korea’s sovereign credit rating is back up and the government has a coffer of foreign exchange reserves, roughly equivalent to $300 billion. However, this major crisis has taught us that a small and open economy like Korea’s is vulnerable to and should always be on alert about capital flight and liquidity shocks.

With this experience as a backdrop, Korea will be well-positioned to serve as an effective bridge between developing countries and advanced economies on one hand, and will be astride net debtors and net creditors on the other hand.

Regarding the agenda of the Seoul Summit, maintaining effective crisis management shall remain a priority for the premier forum. The G-20 leaders will address ensuring strong, sustainable and balanced growth, strengthening the international financial regulatory system, modernizing the international financial institutions and meeting the challenges in trade and energy security.

Furthermore, Korea will introduce two new agenda items to the ongoing list. They are the establishment of stronger global financial safety nets and the creation of a G-20 action plan to aid and encourage development to reduce poverty in the developing world. These new agenda items are in sync with the motto for the Seoul Summit, “Shared Growth beyond Crisis.”

Korea has been advocating the importance of strengthening global financial safety nets, especially for small and open economies. During the late 1990s, Korea experienced the negative effects of sudden outflow of international capital, despite that its macro economic conditions and policies were sound.  In Korea’s view, strengthened global financial safety nets would ultimately enhance overall stability and resilience of the international financial system.

Regarding the action plan, what Korea envisions is a focused, economic-growth oriented development through private sector capacity building and human resource development. Within the last few decades, Korea has struggled its way to become a model development story, and the country is concerned about reducing poverty in less prosperous parts of the world and narrowing the development gap.

Finally, the Korean government believes that in order to sustain the current economic recovery, it is crucial that the business community step forward. The Business Summit, designed to bring together over 100 CEOs from leading global corporations to discuss the global economy, is scheduled for November 10-11, almost concurrent with the G20 Summit.

Korea has always been ready to share with the Baltic States its experience from rapid economic development and its overcoming the effects of the global financial crisis in the late 1990s. In the upcoming Seoul summit meeting, Korea is willing to do its share by promoting strong, sustainable and balanced growth and a more stable financial environment in the global community. I hope that the Baltic States would support the Korean endeavors in this regard and join us in wishing the event a great success.