YONHAP NEWS

Lee, Obama summit likely to focus on N. Korea, global economic recession

   By Hwang Doo-hyong
WASHINGTON, March 29 (Yonhap) -- The first summit meeting between South Korean President Lee Myung-bak and his U.S. counterpart Barack Obama in London next week will likely focus on tackling the worst global economic recession in decades and North Korea's nuclear and missile threats.

   Lee will meet with Obama bilaterally Thursday on the sidelines of the G20 economic summit, the second of its kind since world leaders gathered in November to combat the worst global economic crisis in decades.

   The summit also comes against the backdrop of an imminent rocket launch by North Korea, which insists the launch is for sending a communications satellite into space. The U.S. and its allies in the region view the claim as a cover for testing the North's ballistic missile capability and possibly reviving missile talks suspended a decade ago.

   "They will discuss strategies for responding to the global financial crisis and promoting domestic demand," the White House said last week in reference to the meeting between the two leaders. "They plan to confer on North Korea to ensure close coordination, assess progress and challenges in the U.S.-ROK Alliance, and share ideas on development of clean energy to address our common environmental concerns."

   Bruce Klingner, senior research fellow at The Heritage Foundation, said the meeting would "focus primarily on coordinating strategies to combat the global financial crisis and North Korea's provocative behavior."

   Klingner also predicted that Lee "will offer recommendations derived from South Korea's reform-driven recovery from the 1997-98 Asian Financial Crisis."

   South Korea, whose economy was hit hardest by the crisis a decade ago, became one of the few countries that successfully emerged from the crisis in a relatively short period of a few years.

   "President Lee will argue for creating a bad bank to handle toxic assets while simultaneously using government resources to recapitalize financial institutions while also having the private sector assume a fair share of the burden," Klinger said.

   Lee will also advocate "the need for bold and decisive action rather than incremental measures to regain market confidence... and removing impaired assets from the balance sheets of financial institutions," he added.

   Klinger also noted that a pending Free Trade Agreement between Seoul and Washington will also likely be high on the agenda.

   "A key message pushed by President Lee will be to reject trade protectionism, an issue of great importance to South Korea given the Obama administration's growing protectionist rhetoric against the Korea-US free trade agreement," he said. "Lee will seek to convince Obama of the merits of the FTA, which is estimated would increase U.S. GDP by $10 billion annually."

   Gordon Flake, executive director of the Maureen and Mike Mansfield Foundation that focuses on U.S.-Asia relations, disagreed with that assessment.

   "It is too early for them to discuss the FTA," he said. "They'd better wait as there is no chance of the FTA getting ratified in the near future before the U.S. economy is recovered."

   Protectionism is growing in the Democrat-controlled U.S. Congress as trade union-backed Democrats fear possible job cuts caused by the Korea FTA amid skyrocketing unemployment fueled by the worsening crisis.

   Obama and other senior U.S. officials have taken specific issue with restricted shipments of U.S. beef and an imbalance in auto trade, calling for an adjustment of those issues before submitting the trade deal, the biggest for the U.S. since the North American Free Trade Agreement that took effect in 1993.

   South Korea has said it would not renegotiate the deal, although some U.S. officials and experts are proposing creative measures to address the issues without revising the agreement itself.

   On North Korea's rocket launch, scheduled to coincide with the G20 summit, Lee and Obama will likely seek a coordinated position with China, Russia and Japan, the other members of six-party talks on ending North Korea's nuclear ambitions.

   "Lee, Obama, and Japanese Prime Minister Taro Aso will seek to create a coordinated response to North Korea's threatened missile launch as well as a strategy for convincing China and Russia to acquiesce to a firm U.N. response," Klingner said.

   South Korea, the U.S. and Japan will likely try to impose further sanctions on the North for a launch of either a satellite or a missile, a move that both China and Russia have so far given a lukewarm response to in apparent sympathy with North Korea's claim that it has the right to develop a peaceful space program.

   The White House said Saturday that Obama will also meet with Chinese President Hu Jintao in London "to take an opportunity to discuss our shared concerns about preparations in North Korea for a launch that we, as you know, would consider to be counter to U.N. Security Council Resolution 1718."

   Softening from an earlier stance, U.S. Secretary of Defense Robert Gates said earlier in the day that the U.S. would not attempt to intercept the rocket unless it was headed for U.S. territory, an apparent conciliatory gesture to China as well as North Korea, which declared that any interception would be an act of war.

   Klingner said that the U.S., South Korea and Japan "share common objectives on the missile threat, as well as Six Party Talks nuclear negotiations, but will likely be at odds with Beijing and Moscow."

   Flake anticipates that Lee and Obama will clearly express their coordinated position on the issue of North Korea's missile launch. "The North Korean missile threat is not only a bilateral issue but also a multilateral one involving all the G20 countries."

   Enhancing their bilateral alliance is also on the table for the Lee-Obama summit. The South Korean presidential office Cheong Wa Dae announced that the leaders "will discuss ways to develop the relationship between the two countries and issues related to the Korean Peninsula, such as the Korea-U.S. alliance and North Korea."

   Klingner predicted, however, that the North's imminent rocket launch and ongoing global economic crisis would "overshadow" discussions on the South Korea-U.S. strategic alliance in London.

   "Though understandable given the immensity of the economic challenges and Pyongyang's threatening behavior, the alliance discussion should not be deferred for too long since it can form the basis for addressing security issues in Asia and globally," he said.

   hdh@yna.co.kr
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