Cold-Shouldered in Iraq

Resources Diplomacy Needs Better Strategy, Coordination

Korea dispatched the third-largest number of troops to Iraq between 2005 and 2008 to help stabilize and rebuild the war-torn Middle East country.

Moreover, it was only in February that President Lee Myung-bak and his Iraqi counterpart, Jalal Talabani, signed a memorandum of understanding (MOU) on Korean firms' participation in developing two billion barrels of oil in southern Iraq.

According to news reports, however, Iraq's oil minister told the Korean ambassador Thursday that he would ban two Korean companies ― SK Energy and the state-run Korea National Oil Corp. ― from taking part in Iraqi tenders, as they had signed $1-billion contract with the Kurdish autonomous government despite Baghdad's opposition.

Actually, the two Korean firms were not among the nine foreign oil companies recently qualified by the Iraqi government out of 38 interested parties for a second round of bidding for contracts to develop some of that country's most prized oil and gas fields. Of course, the Korean firms are not the only foreign oil explorers suffering from discrimination sandwiched in the hegemony battle between Iraq's central and regional governments.

Still the result is quite embarrassing and disappointing, not just because the Korean government has made strenuous efforts ― militarily and otherwise ― in Iraq, but because the ``resources diplomacy'' has been one of the trademark policies of the Lee Myung-bak administration. Especially so, considering the oil contract in question with the Kurdish regional government was widely publicized here as the first fruits of the incumbent administration's resources policy about a year ago.

Government officials say the Korean firms' disqualification has less to do with political reasons than technical ones by failing to meet minimum investment targets. Still, the question remains over where the much-trumpeted cooperation between the government and private sector has gone so that they are not aware of basic requirements in making bids?

It's one thing to express regrets against Baghdad, which seemed to break promises made by its head of state even before the ink on the MOU runs dry, but it's another for the Korean government and businesses in the long run to calmly review the resources diplomacy not just in Iraq but elsewhere on this occasion.

The Iraqi fiasco reflects the hastiness with which the Lee administration jumped into overseas energy development, alarmed by the rocketing oil prices last year and vigorous energy diplomacy conducted by the Chinese and Japanese governments. As Seoul was no match for Beijing and Tokyo in terms of money and experience, it should have carefully worked out strategies that maximize its own advantages to make up for the handicaps of latecomers, but failed to do so.

President Lee's tactic of encouraging competition among different agencies has also resulted in a waste of resources due to overlapping overtures to the same partners, raising costs and enhancing the positions of resource-rich countries and sometimes leaving unfavorable impressions about resource-hungry Korea.

In appointing Han Seung-soo as prime minister, Lee gave him the subtitle of ``resources diplomacy premier.'' It is doubtful, however, whether the President has given Han the authority and responsibility that well befits the nickname. If not, this is the time to do so ―

before it gets too late.