The world needs firm political leadership and robust governance to resolve the ongoing economic calamity and maintain sustainable growth, said SaKong Il, chairman of the Korea International Trade Association.
Accompanying President Lee Myung-bak for his five-day state visit to the U.S., SaKong gave a lecture at Harvard University on Thursday on the global economy, its absence of leadership and the Group of 20.
“The current eurozone crisis obviously has various structural and fundamental causes, most importantly, the monetary union with fiscal sovereign authorities,” said SaKong, who also headed the presidential committee for the G20 summit in Seoul last year.
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SaKong Il |
He stressed that the current sovereign debt crisis in Europe and other grave challenges the world’s economy faces stem from a lack of political leadership in individual countries, the 17-member currency bloc and the world on the whole.
Leaders in the world’s richest economies have been mired in political feuds over how to put a brake on their deepening woes, stoking spillover fears for the regions’ banking sector and the broader global landscape.
The European Commission President Jose Manuel Barroso laid out long-awaited solutions on Wednesday but Slovakia initially blocked the increase of the union’s main bailout fund amid apparent domestic political quarrels.
“No wonder there are voices calling for a ‘super finance minister’ for the whole eurozone to oversee, especially the member countries’ budgetary processes,” SaKong said, citing the EC President Jose Manuel Barroso who called Europe “the slowest country.”
A similar problem pushed the United States to the brink of a default then a double dip recession. Lawmakers got stuck in a partisan clash over raising the federal debt ceiling last summer. A Korea-U.S. free trade agreement, which U.S. Congress ratified Wednesday night local time, awaited legislature approval from both countries for more than four years.
“The outside world still has high expectations on the U.S. to exert global leadership,” SaKong said.
He also extolled the emergence of the G20 as a new governance body that reflects a shift in the global economic power, highlighting its role in helping fend off a looming double-dip slump at the summit in Cannes next month.
“The G20 is yet to prove itself as legitimate, credible and functioning premier forum for international economic cooperation or global steering committee,” SaKong said. “It should come up with actionable programs for dealing with the current crisis, since we cannot afford to disappoint the global community.”
By Shin Hyon-hee (
heeshin@heraldcorp.com)
