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By Na Jeong-ju
Staff Reporter
Every government has its own think tank that sets the direction of national policies and addresses social and economic needs.
President Lee Myung-bak has the Council for National Future and Vision, launched
 Kim Sang-hyup |
The council, comprising 26 renowned scholars, entrepreneurs and economists, advises Lee on forming future policies in five sectors ― national strategies and unity; diplomatic and security issues; the environment, energy and science; industry and the economy; and ``soft power'' leadership.
It is easier said than done to produce policies through rounds of brainstorming with members with different backgrounds. But they work with one simple goal: Make South Korea a better place to live in.
``I wish my country to be a charming and truly dynamic country that is a model for the world,'' Kim Sang-hyup, presidential secretary for the national future and vision, told The Korea Times.
The council is behind a series of policy goals the Lee administration has announced to sharpen the country's global competitiveness
Lee started a long-term project to create a ``green and low-carbon'' society by actively participating in global efforts to fight climate change and develop clean sources of energy.
The President has pledged to establish the rule of law, deal sternly with illegal strikes and root out corruption as part of efforts to improve Korea's global image. He also promised to increase the country's contributions to global organizations and share its development experience with poor countries so that Korea can get due international respect.
``Our projects to grow green technology and clean energy into new growth engines will create jobs and help the country overcome challenges from climate change and fluctuating oil prices,'' Kim said.
Such initiatives are truly attractive, many foreign investors say, and show Korea's determination to join the ranks of advanced countries in many ways. However, changes are being made too slowly and there are many obstacles for Korea to clear the away to become a respected member of the international community, they say.
Korea's Global Reputation
According to Kim, a former journalist, South Korea will increase its portion of renewable energy to the nation's entire energy consumption from 2.4 percent last year to over 11 percent by 2030.
He said South Korea will build one million ``green homes,'' entirely dependent on new renewable energy, and become the world's fourth-largest producer of environmentally-friendly ``green cars,'' by 2020.
Kim stressed the government will further reinforce research and exploitation of natural resources in the Arctic Ocean and Antarctic Continent, as part of a drive to secure offshore energy resources.
``Such projects will help upgrade the value of South Korea's national brand,'' Kim said.
Kim heads a Cheong Wa Dae team that supports the presidential council. To meet the needs of foreigners in implementing national projects, Cheong Wa Dae also formed an international advisory group, including McKinsey and Company Asia Pacific Chairman Dominic Barton; former Microsoft Chairman Bill Gates; World Economic Forum Chairman Klaus Schwab; Singapore's Senior Minister Goh Chok Tong; Brookings Institute Chairman John Thornton; and Harvard Business School Professor Michael Porter.
``There are some key words that can define the role of the presidential panel on future planning. The panel is developing policies to tackle climate change, energy and water crises, and Korea's rapid transition toward an aged society,'' Kim said.
This year, the council will focus on measures to stabilize the financial market as the country is suffering from an outflow of foreign capital and a steep economic downturn.
Many global economists have said South Korea needs to overcome its transitional difficulties in the restructuring of its capital, labor and industrial markets to offset the country's slow growth.
As Korea approaches the technological and knowledge-based frontier, the capacity to innovate becomes more important. The weight of the country's economic dependency should be shifted more onto small- and medium-sized companies, as they are ``the sources of radical new technologies,'' Kim said.
Energy Crisis
One of the most urgent issues the presidential panel should deal with is the energy crisis. Experts say Korea needs to come up with emergency plans to secure resources, such as oil and gas, to stave off an energy crisis that is looming larger than ever.
Korea's energy sufficiency rate is now 4.6 percent, meaning that the country is importing more than 95 percent of its energy resources.
``Energy is a national security issue. Korea should make bolder investment in energy development. We will see the most benefit from this because we don't have oil or gas,'' Kim said.
The presidential secretary said Korea should learn lessons from Denmark, which has grown into an energy-rich country by pushing for clean energy policies.
``Even as early as the 1970s, Denmark imported 99 percent of energy. However, it has expanded investment in renewable energy development and conducted active energy diplomacy since the global oil crisis in 1973,'' Kim said. ``The portion of renewable energy in total energy consumption grew from 3 percent in 1980 to 15.6 percent in 2006.''
In this regard, President Lee's recent move to develop alternative energy is considered a step in the right direction. In August, the Lee administration unveiled a development plan designed to increase its proportion of renewable power.
Under the plan, the government will spend a total of 111 trillion won or about $100 billion to increase the portion of non-fossil fuel energy sources from the current 4.6 percent to 11 percent by 2030. The energy plan covers 22 years starting this year and is up for renewal every five years.
Kim said improving the investment environment for foreign investors is also key to upgrading Korea's national competitiveness.
According to a survey on 845 foreign firms by the Korea Chamber of Commerce and Industry, only three out of 10 said they were willing to increase investment in Korea this year. The rest said they had decided to opt for alternative destinations such as Singapore and Hong Kong.
The main reason for their exit was the gloomy outlook on investment conditions due to unfavorable foreign currency rates, soaring inflation, unstable labor relations and insufficient government countermeasures, the business lobby said.
Deregulation and tax breaks were the most urgently demanded measures, as polls showed that Korea falls behind its Asian rivals such as Hong Kong and Singapore in terms of incentives, administrative procedures, and transparent and consistent policies.
Labor Market Flexibility
Kim also said the panel will also focus on increasing labor market flexibility, while strengthening a social safety net for the jobless.
``The administration will address the issue of non-permanent employees. A steep increase in the number of temporary employees in recent years has caused a lot of social problems. The panel will provide solutions soon to the issue,'' Kim said.
Surveys by global organizations show the Korean labor market has limited competitiveness.
The Switzerland-based Institute of International Management Development noted in its recent World Competitiveness Yearbook that Korea's global competitiveness remained near the bottom among 61 economies in the ``labor market'' segment, based on manufacturing unit labor cost, working hours, labor disputes and economic activity participation rate. Korea ranked 26th in 2005, 43rd in 2006 and 28th in 2007.
According to the World Bank, Korea ranked 110th in terms of labor market regulations, indicating the government held a very tight control of the labor market. The World Bank report noted that among others, the regulations covering working hour flexibility and severance costs remained unusually oppressive. The World Economic Forum also underlined Korea's relatively high level of regulations in the labor market in its Global Competitiveness Report of 2006-2007.
jj@koreatimes.co.kr
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