Korea’s leadership burdens in G20 Summit: great expectations in balancing diverse global interests

With the onset of the G20 Seoul Summit, higher decibels and a heavier tone of expectations emanate from global leaders and stakeholders both invited and uninvited to the event. Korea’s leaders, as well as ordinary citizens are now burdened with the act of balancing divergent global interests, as the eyes and ears of the world prepare to converge in Seoul.

Maragtas S.V. Amante

By Maragtas S.V. Amante

With the onset of the G20 Seoul Summit, higher decibels and a heavier tone of expectations emanate from global leaders and stakeholders both invited and uninvited to the event. Korea’s leaders, as well as ordinary citizens are now burdened with the act of balancing divergent global interests, as the eyes and ears of the world prepare to converge in Seoul.

Korea is strategically, and uniquely located between three economic giants: China, Japan and Russia. Strong political and military ties with the United States will require Korea to balance these strong geopolitical interests, and face threats as well as opportunities to craft new global strategies.

Korea’s leaders are now burdened with heavier demands not only to listen, and act as a bridge or as a mediator, but also be pro-active in anticipating drastic changes of attitude in the negotiations among the G20 leaders. Korea is also expected to bridge the gap between the developed _ especially what used to be the G7/G8 countries, the emerging economies, countries still developing, and those left behind who are still recipients of massive doses of assistance and bail-outs for many decades.

The event will also highlight contradictions and gaps not only among the blocs of rich countries in the U.S. and Europe and among the emerging markets in East Asia and South America, but also with poor countries that need a voice at the discussions.

The usual crowd of both foreign and local protestors will also test the capacity, maturity and tolerance of the police in keeping order and security, while respecting the freedom of expression and assembly, as well as other democratic rights.

The event also offers a precious chance to highlight the “Korean development model”. Korea’s leadership of the G20 is a chance to show that an organized culture of nationalism or love of country, commitment to continuous innovation, investments in social and physical infrastructures, human capital investments through education and training, and focused leadership, among others, are essential to overcome crises and constraints to economic development.

Very few are aware of Korea’s development experience after the devastation of World War II and the Korean War, as well as the recovery from the Asian financial crisis in 1997-98. Featuring the Korean development model through information kits given to thousands of summit delegates descending on Seoul, along with the large amount of global attention the G20 summit will receive, should be a landmark contribution more valuable than endless billions of dollars into the sinkhole of development assistance to poor countries.

It is important for Korea to transform the development dialogue and overcome the lobby of professional beggars entrenched in international organizations who claim to speak on behalf of poor people from all over the world. Korea could show that the way to development also requires hard work, strong institutions of transparent and democratic governance, as well as consensus.

All countries have a common stake in green technology, stable financial markets, and fair globalization - sufficient incentives for leaders of countries inside and outside the G20 to be bound together by a Seoul statement in November 2010.

There are urgent issues that require follow up, such as effective global financial regulations, global warming, job creation and the decent work deficit, among others.

The event is a rare teaching opportunity for other countries to learn how Korea mobilized patriotism or love of country to recover from war, low incomes and lack of jobs to achieve advanced industrialized status.

Korea’s experience should teach developing countries how to graduate from being a recipient of international assistance to being a donor. Many development policy makers are not familiar with Korea’s experience: how the state provided leadership to organize industries and markets, overcome market failures, build infrastructure, advance in science and technology, implement a decisive postwar agrarian reform, and other key features of Korea’s development.

There are some paradoxes about the G20 Seoul Summit in Korea. The G20 summits first began after the beginning of a crisis stemming from the capitalist system in the West, mainly the U.S. and Europe. The first meeting was held in 1999 in Berlin, between finance ministers, central bank governors and the IMF.

This year, however, the venue is Korea, in East Asia. Emerging countries such as China, Brazil, India and Russia may have significantly different priorities. There are new emerging tensions in Northeast Asia. Day by day, there are new hidden fireworks which could scuttle negotiations on sensitive issues regarding the balance of trade, currency, financial and banking regulations, and global warming.

Korea’s organizers may have to refocus the agenda to highlight the G20’s significance to Asia and the emerging markets. The G20 also signifies a power shift away from the G7/G8 countries, the acknowledged locus of financial and monetary coordination.

The Pittsburgh summit in 2009 acknowledged this power shift and established the G20 as the “premier forum for international economic cooperation ... in an interconnected global economy to build and balance the global economy, reform the financial system, and improve the lives of the poor.”

Seoul’s G20 organizers will be expected to carry over much of the heavy baggage from the 2009 summits in London and Pittsburgh: follow up action on global warming, results from the financial regulatory reforms, transparency in compensation to be linked with long term risks, caps in executive bonuses, job creation, filling the decent work deficit, social security and other issues.

Lastly, the G20 summit is a rare event which highlights Korea’s diamond dilemma, between the path of brilliance or mediocrity especially for the younger generation. The event will provide important lessons for Korea’s institutions to be in a position to supply a greater demand for global leaders, managers and innovators – important byproducts of Korea’s big spending and hard work for the Seoul G20 summit.

Profile of Maragtas S.V. Amante
Dr. Maragtas S.V. Amante is professor at the College of Economics and Business Administration, Hanyang University (Ansan campus), Korea. Previously, he was a professor at the University of the Philippines, Diliman. He had consultancy work with various companies, employers groups, the International Labor Organization (ILO). He was also a consultant with the ASEAN Secretariat on labor issues (2002 to 2007). He graduated from the University of the Philippines’ School of Economics in 1983; and finished a master’s degree at the University of Illinois in Urbana Champaign in the US in 1986. He finished his Ph.D. in 1993, from Keio University in Tokyo. He had research fellowships with the Japan Institute of Labor (1994), Cardiff University, UK (2002 to 2004); and the Institute of Developing Economies (IDE); JETRO, Tokyo (2007).