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(2nd LD) Lee proposes 3-step reunification with N. Korea, related tax
By Lee Chi-dong
SEOUL, Aug. 15 (Yonhap) -- South Korean President Lee Myung-bak on Sunday proposed a three-stage reunification with North Korea and the introduction of a "unification tax" to prepare for the huge financial burden expected if the two Koreas are reunited.

   The offer marked the conservative president's first specific comments on the long-term goal of reunification, talks of which have been sidelined under his administration that has placed top priority on denuclearizing the North and wanted compliance from the North to repay for economic assistance.
Tensions have been soaring on the peninsula in recent months since the sinking of a South Korean warship in March that killed 46 sailors. Based on a multinational probe, the South concluded that a torpedo attack by the North sank the ship. As Seoul has ratcheted up pressure on Pyongyang through the United Nations and joint naval drills with the U.S., the communist regime has responded with threats of war and firing of shore artilleries into the Yellow Sea.

   "Today, inter-Korean relations demand a new paradigm," Lee said in a televised speech to commemorate the 65th anniversary of Korea's independence from Japan's 1910-45 colonial rule. "It is imperative that the two sides choose coexistence instead of confrontation, progress instead of stagnation. The two of us need to overcome the current state of division and proceed with the goal of peaceful reunification."

   Lee reiterated calls for the North's leadership to face reality and not be afraid to change.

   Lee unveiled his blueprint for a unified Korea, saying creating a "peace community" that assures security and harmony is the first step. He set the denuclearization of the North as a prerequisite.

   "The next step is to carry out comprehensive inter-Korean exchanges and cooperation with a view to developing the North's economy dramatically. The result will be an economic community in which the two will work for economic integration," he said.

   After this, the two Koreas can remove the wall of different systems and establish a genuine community, where freedom and basic rights of all Koreans are guaranteed, Lee pointed out.

   Lee also asked his country to consider a special tax to finance preparations for reunification in the future.

   South Korea is estimated to shoulder a cost of around US$1.3 trillion in case it reunifies with the North, according to a study commissioned by a parliamentary committee. Germany has spent two trillion euros over the last two decades to cover its so-called reunification cost.

   The president asked experts and politicians to start discussions on the size of the unification tax and ways to levy it.

   Lee's remarks in the 20-minute address set the tone for his policy in the second half of his single five-year tenure, which begins on Aug. 25, his aides said.

   On the often-troubled relations with Japan, Lee said Seoul and Tokyo should seek "concrete measures" to develop a new partnership.

   Lee positively assessed Japan's efforts to improve ties with South Korea shown in Prime Minister Naoto Kan's statement last week, which apologized for Tokyo's 1910-45 colonization and admitted it was against the will of the Korean people.

   "I have taken note of Japan's effort, which represents one step forward," Lee said. "However, there still remain issues that have to be resolved. The two countries are called upon to take concrete measures to forge a new relationship for another 100 years."

   He was apparently referring to Japan's refusal to acknowledge the annexation was illegal and provide appropriate compensations for victims.

   South Korea and Japan are also at odds over Tokyo's attempt to lay claim to the sovereignty over Dokdo, a set of South Korea's easternmost islets, and whitewash its wartime past.

   With regard to domestic policy, Lee vowed efforts to foster a "fair society," in which equal opportunities are guaranteed based on the social responsibility of all individuals and organizations.

   "Now is high time for us to pay attention to the values of a fair society," he said. "What is important at the moment is to wholly translate the quantitative economic growth into an improvement in the quality of individual lives."

   He said he will redouble efforts to care more for the working class and other low-income people in line with his "centrist, pragmatic" policy drive.

   Lee also called for political reform to address extreme political confrontation and perennial regionalism, demanding political parities initiate full-scale discussions on the revision of the Constitution and a change in the electoral system.

   He said his government plans to drastically strengthen research and development for green technology for the goal of developing South Korea into one of the most powerful countries in the green industry by 2020.