(EDITORIAL from the Korea Times on Dec. 3) Slump in exports: Nation should reduce undue reliance on foreign shipments

Government and business officials vowed to hit next year's export target of $500
billion on the 45th Trade Day, Tuesday.
Most of the participants in the ceremony, including President Lee Myung-bak,
appeared more resolute than confident, however: Foreign shipments plunged 18.3
percent in November, the biggest monthly setback year-on-year since December
2002, when the global IT bubble burst.
Trade officials and business executives had expected exports would turn downward
but not this fast. The global recession is affecting not just industrial
countries, including the United States and European Union, but emerging economies
like China.
Situations will likely turn even worse next year, when the U.S. and EU are to
record negative growth and China struggles to meet a far lowered growth target.
Even if this is not enough, some U.S. media outlets reported the next U.S.
Congress would prove to be the most protectionist since the 1930s, forecasting
Washington's free trade agreements with Korea, Panama and Colombia will have hard
time winning congressional approval. For Korea's troubled export companies,
misfortunes are seen to never come in ones.
President Lee called for dispirited exporters to redouble their efforts,
reiterating his trademark promises of ``preemptive and sufficient'' support in
financing and other administrative areas. These short-term remedies are of course
necessary in addition to such time-honored measures as enhancing logistical
systems, cultivating trade manpower and reducing foreign exchange risks. For
exporters' part, they must develop new technology and products to sharpen their
competitive edge not just in terms of price but also in quality.
In the longer term, however, it is time the nation seriously considered changing
its industrial structure to one less vulnerable to changes in trade terms, namely
the rise in raw materials, including crude oil. This requires development of
high-tech and high added-value industrial sectors, including services.
When Korea seeks to advance its economy, it should mean not just the increase of
national wealth through the endless repetition of export supports verging on
``mercantilism'' but the sophistication of the overall industry and economy.
Going one step further, it is also high time that the nation gradually reduces
its undue reliance on exports and overseas markets, which amounts to 70 percent
of its economic expansion. This is too high a level of dependency for the world's
13th-largest economy, making it extremely vulnerable to increasingly rapid
changes in the global economic environment, while causing trade friction with
other countries often beyond necessary levels.
To sum up, the government's policymakers and business leaders need to pool their
wisdom to make the nation's economic structure more resilient and less dependent
on external whims, while stabilizing the livelihood of people, particularly the
mid- to low-income workers.
Seoul ought to carefully watch the global trends toward re-regulation and
``selective liberalization,'' instead of blindly seeking the path of failed
neo-liberalism, which has resulted in a further widening of income and wealth
disparity.
Exports have been and will be the backbone of growth for this small, open
economy, but now is the time for the nation to rack its brains on how to upgrade
its structure and make the overall economy more sophisticated.
(END)