A recently released US Treasury Dept report (Feb. 4) has finally laid bare what no Korean journalist has dared to mention in the past three years.

The readers of The Korea Times are constantly bombarded by articles talking about the strengthening, or appreciation, of the Korean won. The cold hard truth is that Korea has recently been the world's top currency manipulator, trying to keep its currency artificially weak.

As the currencies of its export-driven Asian neighbors and most of the world's currencies have risen back to their 2007 levels, the Korean won remains comfortably 25 percent lower. The bottom line is simply that you cannot possibly explain how your currency is 25 percent weaker than those of your competitors, while your GDP, trade balance and stock market levels are comparable or superior to theirs.

The currency myth has been propagated by government obfuscators of the truth, like the current finance minister Yoon Jeung-hyun. Minister Yoon seems to have also mastered the Jedi Mind Trick, which apparently works for all Korean writers who write about the won, even in supposedly professional publications such as Bloomberg and your newspaper.

Government officials like Yoon claim that they have merely tried to smooth over fluctuation, which actually means keeping a steel boot pressed against any chance for the won to rise. Compare the won with Chinese yuan and then things get clearer. The Chinese yuan is currently worth over 170 won. In 2007, it was worth 120 won, which means that there has been a 30-percent won depreciation.

The only question is if and when KT writers will escape Minister Yoon's Jedi Mind Trick.

Boguslaw P Balata
Former CME floor broker/trader, currently teaching in Korea