The Korean economy is likely to rebound in the latter part of next year, but at a slower pace than previously anticipated. Concerns are growing that the country might not see a full-scale recovery until 2014. It is inevitable for us to become more patient and wait for good times after taking all possible measures to make sure sustainable growth is restored.
Indicators show some signs of a turnaround, but it is still too early to say that the economy has bottomed out. We have to admit that gloomy news still reigns over not only South Korea but also most countries around the world. Especially, the nation is facing rough sailing on the raging waves of the global and economic tsunami. The Korean economy cannot stand alone as it is heavily reliant on exports.
In fact, Korea Inc. is adrift in uncharted waters. We don't necessarily have to be too pessimistic or too optimistic. Instead, we have to face reality as it is, in order to wisely overcome the present difficulties with well-organized efforts. The country was described as the world's 11th largest economy in 2002-03. But the ranking has continued to slide, edged out by the rapidly emerging economies of Brazil and India.
According to the World Bank, South Korea's gross domestic product (GDP) was estimated at $969.8 billion, the 14th biggest among 188 countries. In its global economic outlook report last month, the International Monetary Fund (IMF) put the Korean economy in 15th place. The fund predicted that the nation's ranking might go down further by one notch to 16th this year. It appears to be difficult for the country to recapture its proud 11th place anytime soon.
President Lee Myung-bak's campaign pledges have proven to be only lip service. Does Lee still dream the ``747" pipe dream of raising the annual growth rate to 7 percent, increasing per capita national income to $40,000 and ratcheting up the country's global economic ranking to seventh? First, Lee should frankly admit that he had painted too rosy a picture and presented unattainable goals to the people.
Then, he must make every effort to seek the people's understanding about his miscalculation and take bolder measures to regain public confidence. He should no long play the game of tampering with figures that do not reflect stark reality and the people's economic destitution amid the worst crisis since the Great Depression.
It is imperative for him to better exercise his presidential leadership to come to the rescue of the recession-bound economy. Ironically, bubbles are forming and a speculative mood is gaining momentum even though the economy is still in the middle a long, dark tunnel. The country cannot get out of the crisis without troubleshooting these unintended effects of the massive stimulus packages.
Therefore, the Lee administration should do more to speed up financial and corporate restructuring in a bid to get rid of overcapacity and overextension, and boost the nation's long-term growth potential. If the nation fails to achieve this restructuring, Korea Inc. might be shipwrecked. It is urgent for President Lee to present a new vision and substantial steps to realize an economic renaissance.