Newspaper article The Christian Science Monitor

If You Think East Asia's Recession Is Isolated, Think Again

Newspaper article The Christian Science Monitor

If You Think East Asia's Recession Is Isolated, Think Again

Article excerpt

How deeply will East Asia's current economic recession cut? How far will it pull down the rest of the global economy? No one yet has an answer. But it is clear that the recession will have a huge impact on the balance of power around the Pacific Rim, including the contest for influence between American and Chinese power in the region.

Much will hang on the stability of South Korea, whose economy is 11th-largest in the world, and whose contest against North Korea has been an intense focus in the contest between Beijing and Washington. In South Korea, all eyes are turned to President-elect Kim Dae Jung.

Kim's opportunity Mr. Kim has a unique opportunity to take the tough steps mandated by the International Monetary Fund, in return for the generous support it has extended to Seoul. Unlike his predecessors, Kim owes few or no favors to the bosses of the massive Korean business conglomerates, whose past ability to get vast government-backed loans for questionable investments was a major cause of the crisis. And unlike his predecessors, Kim has thus far enjoyed good relations with labor unions. Kim also is in the politically happy situation of being able to blame all of his country's economic woes on the misdeeds of his predecessors. His support in the National Assembly is weak. But the former ruling party also is in disarray. And if, after he takes office Feb. 25, he acts boldly - to stem South Korea's economic decline and to work toward reunification with North Korea - then he could emerge as a national hero, and one of East Asia's most important leaders. This could count as a great victory for the forces of democracy in a region where such forces still are young and fragile. Kim can't expect much support from inspired political leadership anywhere else in East Asia. Indonesia, where half a million people have been put out of work in the past few months, will hold its next general election in March. President Suharto likely will run unopposed for his seventh five-year term, and he hasn't yet allowed any credible political successor to emerge - which leaves the country's leadership in question. …

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