G-20 summit

Even if the world survives the current financial crisis, the global economic order will never be the same.

So the financial summit of 20 major economies scheduled for Nov. 15 in Washington
will mark the start of a long process to redraw the global economic picture, in
which participants will have to stage a quiet but intensive war of nerves for
their future role and status.
The United States and European Union are already quarreling over the scope of
reforming the world economic system, while the interests of the industrial world
could be pitted against those of emerging powers.
Bearing the brunt of the U.S.-caused financial quake and visiting the
International Monetary Fund with cap in hand are some East European and South
Asian countries lying on the periphery of the concentric circle named the global
economy, indicating how this turmoil has already turned into a dog-eat-dog
economic war.
There is nothing unusual about Korea taking its place in the G20 summit as the
world's sixth-largest reserve holder, 10th-largest trader and 13th-largest
economy. Still it left some points to ponder as to why Seoul was excluded from
coordinated interest cuts and the dollar-swapping of major economies recently,
whether it was poor diplomacy or economic vulnerability to external shocks.
This conversely points to the need for Seoul to play a more active diplomatic
role congruous with its economic power both regionally and globally, including
the upcoming Washington conference. That U.S. President George W. Bush lately
called his Korean counterpart and asked for Korea's positive cooperation over the
phone leaves not so simple a nuance in this regard. Bush's spokesman said
afterwards President Lee Myung-bak "has a great deal of insight."
President Lee's unswerving belief in market principles and his opposition to
return to protectionism might have appealed to the White House, which seems to
have failed to hear about Lee's somewhat conflicting earlier calls for a
"fundamental overhaul" of the world economic order, actually built on America's
primacy more than six decades ago.
In more practical terms, the U.S. might be needing deep-pocketed foreign buyers
of its treasury bonds to help ease its credit squeeze as well as an ally in its
hegemonic battle against the EU as well as Asian rivals. In an extreme scenario,
this could throw Lee into another dilemma -- whether he should remain loyal to
Korea's biggest ally in trouble or divide apples of allegiance in several
baskets, including Seoul's two giant neighbors, as he is now seeking through his
three-nation cooperation.
Of course, it needs not be a this-or-that game, and Korea will likely try to play
the role of a good mediator among contenting countries and groups of nations. But
there will come a time when Seoul should calculate what would best serve its
national interests.
It may be too early to say the Pax Americana is over, as shown by the dollar's
ironical strength amid the crisis as well as the globally synchronized financial
markets. Still, the U.S. will no longer be a sole superpower but remain as just
one of the great powers for the foreseeable future if for no other reason than
its huge debts.
In crisis, actions say much more than words and practical benefits take as much
importance as -- if not more than -- good causes. This is the time when Lee's
only known philosophy -- if it can be called so at all -- of "pragmatism" can
prove itself really applicable.
Based on a majority of Koreans' weak trust in President Lee and his economic team
at home, their capacity abroad is dubious, however -- one more reason why Lee
should reshuffle key economic policymakers and make a fresh start.
(END)