Majority Party Leader Outlines South Korea's Economic Policies in Wake of Collapse

Cho Se Hyung, the acting president of South Korea's majority party, returned to speak about Korean politics to a packed audience in Yenching Auditorium yesterday, 33 years after he spent a year at Harvard as a Nieman fellow.

"I am indeed overwhelmed with nostalgia to be back at the Harvard campus," Cho said.

Hosted by the Korea Institute and the East Asian Studies department, Cho's speech explained how his party, the National Congress for New Politics, is responding to the economic crisis in South Korea.

"One of the major reasons why Korea encountered the foreign exchange crisis at the end of 1997 and sought assistance from the IMF was troubled banks," Cho said. "Under the new government, banks will have to close if their performances turn out to be poor."

Cho said the new administration, the first to be democratically elected in nearly fifty years, is moving closer to free market policies. Banks will be autonomous, rather than under the government's control.

While acknowledging South Korea's unemployment rate of 7.5 percent and a $150 billion debt to foreign countries, Cho was optimistic about the future. He said three factors have helped push South Korea's economic recovery: the diplomatic efforts of Kim Dae-jung, South Korea's president, international aid, and the combined efforts of the people.

"We plan to create one million jobs in the next two to three years and anticipate 300,000 new jobs this year," Cho said. "The government will also be providing loans to help establish small- or medium-sized businesses or home offices."

Cho spoke of President Kim's three-tiered policy toward North Korea.

"First, we will not tolerate any military challenge of North Korea. Second, we have no intention of doing damage to North Korea or of unifying North Korea by absorbing it and third, we desire to start overall interaction and cooperation between the two sides," Cho said.

Although North Korea is continuing to conduct underground military operations and missile tests, Cho pointed to the recent opening of North Korean borders to tourists as reason to hope for increased communication between the two countries.

"The most important change is the arrangement of tourism to the Kumgang Mountain...The visitors sang together with North Korean tour guides," Cho said. "No one could have imagined such a thing even one year ago."