Kang Seung-woo is the Business Desk editor at The Korea Times. Prior to this position, he covered politics, national affairs, finance and sports.
Foreign ministry seeks to regain authority over trade
This photo shows the Ministry of Foreign Affairs building on the left. Newsis
By Kang Seung-woo
By Kang Seung-woo
The foreign and industry ministries are engaged in a tug of war over which institution will have the authority to promote trade under the Yoon Suk-yeol administration. The Ministry of Foreign Affairs is seeking to recover its original responsibility over trade matters, while the Ministry of Trade, Industry and Energy is arguing for trade authority on the basis of its recent successes in the field.
When Korea's first presidential administration was launched in 1948, trade affairs were initially under the jurisdiction of the foreign ministry, which was renamed the Ministry of Foreign Affairs and Trade in 1998 during the Kim Dae-jung administration.
In 2013, the Park Geun-hye administration transferred the trade functions to the Ministry of Knowledge Economy, which was reorganized as the current Ministry of Trade, Industry and Energy. President Moon Jae-in tried to return authority over trade affairs to the foreign ministry in 2017, but the effort fell through.
The foreign ministry argues that the industry ministry has not dealt adequately with the current global trade environment, in which economic issues are connected directly with security. It cited the recent shortage of urea water, a key fluid needed in diesel vehicles to cut emissions, after China imposed export curbs on the liquid last October to ease domestic supply bottlenecks.
The foreign ministry believes there would have been no problem if it had been able to negotiate with the Chinese government, using its fully established networks. In the wake of the shortage, the government imposed curbs on where and how much of the solution could be sold in order to address the problem.
On Thursday, the foreign ministry held a policy briefing for Yoon's transition team and used the opportunity to stress the importance of restoring its trade function. The foreign ministry also discussed with the transition team ways to cooperate with major countries in areas such as high-tech supply chains, considering the importance of economic security and diplomacy.
The foreign ministry's argument comes as Ahn Cheol-soo, the chairman of President-elect Yoon Suk-yeol's transition team, had pledged to transfer trade affairs back to the foreign ministry when he was a presidential candidate. Later, he dropped out of the presidential race and endorsed Yoon for president.
As Yoon is anticipated to reflect some of Ahn's pledges in his policies, the foreign ministry is expected to put its utmost efforts into recovering its responsibility for trade affairs.
In response to the foreign ministry's plan, the industry ministry is also exploring measures to keep trade functions under its authority, claiming that doing so will be positive for the nation's economy and industrial competitiveness.
The industry ministry also held a policy briefing for the transition team on Thursday and stressed the importance of a trade strategy that is integrated with industrial policy. In the briefing, the ministry explained ways to strengthen cooperation with key countries in supply chains, industrial security as well as digital and green technologies.
“The establishment of the Ministry of Trade (Industry and Energy) has strengthened its specialty,” a study by the Korean Association for Public Administration (KAPA) stated.
KAPA also said that the industry ministry should maintain its responsibility over trade promotion in order to deal actively with global issues such as the climate crisis and carbon neutrality.
Amid the intensifying competition between the foreign and industry ministries, local export companies overwhelmingly prefer the latter to be in charge of trade affairs.
According to a survey by the Korea Industry Associated Forum, released on Wednesday, 87.1 percent of 124 firms, or 108, want the industry ministry to maintain its authority over trade promotion, as they think smooth communication would be possible.