Welcoming President-elect's attention to economic security diplomacy

By Song Kyung-jin

Many Koreans had a sleepless night on March 9 when the ballot counting was underway until the wee hours of the next day in a very tight presidential race. Yoon Suk-yeol garnered a razor-thin victory over his opponent Lee Jae-myung, who conceded his defeat. It was a scene symbolizing Korea's mature democracy.

Yoon was chosen to lead the country at a fragile moment when the country is presented with a myriad of challenges, such as the U.S.-China competition, the Ukraine crisis, the North Korean problem, spiking energy and commodity prices, and an aging population. Rapid changes are being witnessed in the world order whereby economic security is becoming an important part of national security. Trade, technology, data, supply chains, energy and climate are all quickly turning into means of economic security diplomacy.

Given this, I welcome President-elect Yoon's emphasis, among other things, on the importance of strengthening economic security diplomacy in his first speech on March 10 in front of reporters. He is right on target, especially when economic security diplomacy is gaining powerful traction around the world.

With all due respect, the consensus view is that the incumbent government should have done a better job in handling foreign policy. One might ask why the sudden fuss over diplomacy? Unlike economic performance that is often quantifiably translated into concrete numbers, diplomacy is rarely quantifiable for people to feel it and therefore less appreciated than it deserves.

Now that politics and foreign affairs have trumped economics and the trend is accelerating, the consequences of any act of economic security diplomacy are immediately felt by people more than before. The most familiar example is the urea water crisis. As I said in my previous column ("The urea water crisis and trust-building diplomacy," Nov. 21, 2021), the crisis was primarily a result of failed diplomacy.

But how did diplomacy fail on such a critical occasion? There is an organizational issue ― the silofication of diplomacy and trade economics in the current government organization. The silofication consequently has limited the nation's rapid response and weakened its strategic decision-making capabilities.

The possibility of the urea water crisis was first noticed by the Korean Embassy in China; however, the Embassy's cable did not get due attention by the ministry concerned. Responses came too little, too late; hence, the urea water crisis that a majority of countries could avoid. One stitch in time could have saved nine with the right structure in place.

The separation and competition between diplomacy and trade also failed the nation with regards to the Ukraine crisis. Major democracies swiftly joined the U.S. and allies to impose economic, financial and technology sanctions against Russia for invading Ukraine on Feb. 21. However, Korea was sitting on the fence lacking proper coordination between the Blue House and the government until it announced the export control measures against Russia on Feb. 28.

It was a blunder stemming from the absence of principled diplomacy and the government's lack of awareness of economic security diplomacy powerfully combined. Protection of corporate interests is always important but it cannot supersede protection of the universal value of world peace and prosperity in the face of war atrocities.

Korea must remember that it is not the only country that has corporate interests to protect and that without swift and adequate actions, businesses will bear more brunt in the end. We must be wary of not being penny wise and pound foolish. As democracy, Korea should abide by Article 5 of the Constitution that states that Korea shall strive for world peace and prosperity.

The Ukraine crisis provided Korea with a pricy reminder that the current silofication is not just ineffective but could be quite costly, especially when combined with "strategic ambiguity" that has been the lodestar of foreign policy of the incumbent government. Strategic ambiguity is tantamount to inaction when action is required. The world we are in now calls for strategic clarity rather than strategic ambiguity.

A set of government principles should be in place that clearly states the philosophy and attitude of the nation built on the Constitution values of democracy; respect for human rights; justice; humanitarianism; freedom and responsibilities; rights and duties; and world peace and prosperity. Therefrom flexibility arises. It should be made an immediate task of the incoming government.

Accordingly, the government organization needs to be readjusted to respond without impartiality to the growing importance of economic security diplomacy. The authority for trade negotiations should be returned to the Ministry of Foreign Affairs (MOFA) that will be accountable to the nation for economic security diplomacy.

Currently, MOFA is seriously understaffed. At the same time, its competence and openness are in question, too, not entirely for external reasons. MOFA itself should be ready to reform and accept competent human resources from outside to be more competitive and efficient.

Time is fast approaching for the President-elect to specify what he means by "strengthening economic security diplomacy." I hope his thoughts are in line with mine.

Dr. Song Kyung-jin (kj_song@hotmail.com) led the Institute for Global Economics (IGE), based in Seoul, and served as special adviser to the chairman of the Presidential Committee for the Seoul G20 Summit in the Office of the President. Now, she chairs the international cooperation committee called the Innovative Economy Forum.