John Burton is freelancer writer. He was Korea correspondent of the Financial Times, business editor of Korea JoongAng Daily.
What happened to green growth?
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By John Burton
Each Korean president usually has a signature cause. In the case of President Park Geun-hye, it is creating a “creative economy.” It is a worthy goal because Korea must rely more on high-tech services rather than manufacturing for future growth.
But the downside is that this campaign will likely to be abandoned when the next president comes to office. Korean presidents have a habit of trashing the favorite agenda of their predecessors. Whatever happened, for example, to making Seoul a global financial hub, an idea that was promoted by Roh Moo-hyun? Is the same fate now in store for the green growth initiatives of Lee Myung-bak?
If so, Korea is losing a valuable opportunity to make its mark in the global energy sector. The issue of climate change is as important as ever. Just a few weeks ago, U.S. President Barack Obama announced a new plan to cut greenhouse emissions and encourage international efforts to combat climate change, including launching negotiations for global free trade in clean energy technology.
Asia is expected to be at the center of this new program in line with the strategic shift in U.S. foreign policy toward the region. And clean energy technology seems to be the type of new industry that President Park says she wants to encourage.
Lee Myung-bak saw renewable energy as one of the world’s future growth industries, on a par with IT, because of the global worries about climate change. “I want to put forward low-carbon green growth as the new center of Korea,” Lee said when he launched the green growth agenda in 2008.
“Renewable energy was on top of President Lee’s agenda and he was obsessed with energy issues. He regarded it as his legacy,” a former Lee aide told me. The Lee administration pledged to spend $40 billion on green growth projects to make Korea one of the world’s top seven countries in green growth by 2020.
Lee’s strong commitment gained worldwide attention. His proposal for establishing a Global Green Growth Institute, to be headquartered in Seoul, won the support and financial backing of 18 member countries. It looks set to become an international leader in providing technical and policy advice to developing countries on pursuing sustainable economic growth.
In addition, Daegu was selected in 2008 to host this coming October’s World Energy Congress, a leading gathering of energy ministers and corporate leaders, based on the city’s credentials as a center of Korea’s green growth industry.
But talk of green growth has died out since President Park took office. The Presidential Committee on Green Growth appears to have been mothballed and green growth does not have a prominent role in the current government’s creative economy plans.
There are several reasons for the sudden disappearance of green growth. One is politics. Green growth was closely identified with the Lee administration and President Park wants to distance herself from her unpopular predecessor. There is also an element of the Not Invented Here syndrome that affects how Korean leaders view their predecessor’s projects.
The green growth drive has also become associated in the public mind with such controversial programs as the Four Rivers Restoration Project, which has become the target of corruption investigations and is being portrayed by the Park administration as a boondoggle.
Finally, the green growth campaign has not yet delivered promised economic benefits in terms of creating successful renewable energy businesses. Local electric car producers, CT&T and AD Motors, are struggling to survive. Korean solar panel manufacturers have been battered by the global industry slump caused by excessive Chinese production.
Critics contend that the green growth initiative has proved to be a failure in Korea since renewable energy accounts for only 0.7 percent of total energy supplies in the country, according to the OECD. But other countries also experienced a slow start in adopting renewables.
The U.S. provides an instructive example. Renewables were touted by President Jimmy Carter in the late 1970s, but the succeeding Reagan administration let the program fall by the wayside due to the same bit of political point-scoring that is now evident in Seoul. The green energy agenda was criticized as hype and uneconomic. It was only the growing debate over climate change that has revived the push for renewables in the U.S.
Abandoning green growth would be a shortsighted move for Korea. Renewables are expected “to become a growing part of energy supply, embraced as a key solution to the triple challenges of energy supply, security and climate,” says Daniel Yergin, a prominent energy expert and author.
The global green industry is expected to be worth $3 trillion by 2020 as the U.S., China, the U.K. and Germany led the drive toward renewable energy. “The nation that leads the world in creating new energy sources will be the nation that leads the 21st century global economy,” President Obama has said. It is something that President Park should bear in mind.
John Burton, a former Korea correspondent for the Financial Times, is now a Seoul-based independent journalist and media consultant. He can be reached at john.burton@insightcomms.com.