Seoul G20 summit in November of 2010 agreed on the importance of the market-determined exchange rate policy, restraint of competitive devaluation and future discussions on the current account guideline. This international agreement may reduce the global currency conflict, in particular the conflict between the U.S. and China. However, it does not constitute a binding requirement in any form aiming at any G20 member. And because the agreement implicitly demands the considerable rate of appreciation for the renminbi, the US-China exchange rate dispute could possibly re-escalate depending on China’s exchange rate policy in the near future.

China’s large current account surplus and massive foreign exchange market intervention imply that the renminbi has been considerably undervalued. Thus the future of global currency conflict will heavily depend on China’s exchange rate management, the speed and degree of appreciation of the renminbi.

The Chinese government and the People’s Bank of China may want to allow the renminbi to appreciate not only to satisfy the demands of the international society including the U.S., but also to accomplish China’s policy goals such as growth with greater orientation toward domestic demand. China’s economy has recently experienced an annual growth of about 10 percent and a large current account surplus concurrently. Thus, to a certain extent, renminbi appreciation will lead the Chinese economy to sustainable growth without sacrificing either internal or external balance. We also suggest that it seems desirable for the U.S. not to continue the pressure for renminbi appreciation when China carries out its exchange rate policy according to market mechanisms. The policy coordination between the U.S. and China will help the world economy flourish by reducing the global currency conflict and trade protectionism.

There are limits to resolving the problem of global imbalance only by exchange rate adjustment. Increase in savings and decrease in fiscal deficits of the deficit countries, and increase in consumption and imports of surplus countries must take place simultaneously with appropriate exchange rate policies. This research deals with those structural policies of the U.S. and China to reduce the imbalance between them. This research also includes the impact of the internationalization of the renminbi on the international monetary order, which has been maintained by the dollar as the anchor currency since the end of World War Ⅱ.

The Republic of Uzbekistan, the hub of history and culture of Central Asia, has experienced remarkably high economic growth at an annual rate of 7.1% from 2002 through 2009. Uzbekistan also has the largest population among Central Asian countries, and as such, good potential for further growth. The Republic of Korea can also contribute more to the development of Uzbek Economy and is expected to have more of its private enterprises establish branches and offices in Uzbekistan. In this regard, there is a high expectation of substantial expansion of cooperation between two countries in future.

Korea should, however, acquire a deeper understanding of the ruling elites in Uzbekistan to further promote this mutual and cooperative relationship. Relatively few studies devoted to Uzbek ruling elites have been conducted by Korean scholars, though these elites exert a huge influence on policy-making and administration in Uzbekistan. As a consequence, Korean policy makers cannot help but remain poorly informed about Uzbek elites whose influence is rather extensive under the authoritarian regime led by Islam Karimov, which subsequently hinders establishing a useful network with local power elites that would be vital for bolstering the bilateral relationship between Korea and Uzbekistan. The present study provides a systematic analysis of the mechanism and characteristics of the Uzbek elite system with an eye toward its historical and cultural roots.

The study consists of five chapters. Following the Introduction, Chapter 2 applies the concept of ‘Neo-patrimonialism’ to the analysis of the Uzbek elite system. This concept is deemed especially helpful for understanding the mechanism and characteristics of Uzbek ruling elites, since its political culture possesses both traditional and modern components and patrimonial power is still a dominant factor in national politics.

Chapter 3 traces Uzbek elites concerning their historical origins and formation processes. The Uzbek territorial boundaries presently encompass various geographical, historical, cultural, religious and ethnic segments; and hence, it is necessary that we divide the country into several major historical and geopolitical regions. First of all, we present an historical overview of the state-building process of Uzbekistan and its peculiarities; and then investigate how elite cliques were formed, competed with each other, and evolved into their present form. The rivalry among Uzbek elites was closely connected to various worldwide conflicts, a dynamic of competition and cooperation among various socialist groups set in motion by the fall of the former Soviet Union and its aftermath. In this regard, analysis of major scandals over political corruption sheds light on the important aspects of factional strife and diversification in the elite cliques.

Chapter 4 gives careful consideration to the formation and development of Koryo-in (Korean diaspora living in the former Soviet Union) elites. We examine how the Koryo-in came to settle in Uzbekistan and how the elite groups were formed among them and have evolved over time to achieve influence over the contemporary political arena in Uzbekistan. This will provide very useful information, as Koryo-in elites are expected to play the role of political intermediaries in expediting creation of a constructive relationship between Korea and Uzbekistan.

The implications of the study can be summarized as follows. The elite network of Uzbekistan is formed around President Islam Karimov and his family, and the elite guard shows strong loyalty to the President while maintaining an intimate relationship with him and his family. On the other hand, elites also pursue their own personal interests on the side. Korea, therefore, should put more emphasis on the following three aspects when they plan to establish any long-term relationship with Uzbekistan. First, Korea should engage in diverse efforts to form unofficial, personal contacts with Uzbek elites to back up their official relations. Second, there is a need for more accurate information about major elite cliques and attempts to accumulate knowhow and experience in detailed negotiation procedures. Third, we need to construct a personal network of businessmen, experts and elites of both countries for long-term and lasting relationships. It is important to have various private channels that can overcome the limitations of official contact when it comes to confidence-building and mediation of disputes.

There is currently no visible resistance against the authoritarian rule of President Islam Karimov and Uzbekistan appears politically stable. However, the country also has potential risk factors. Local powers are unlikely to show absolute obedience even if centralization of power is enhanced in the near future. The central government must find ways to satisfy the wants of local elites in order to assure their loyalty. As President Islam Karimov ages and his health deteriorates, finding his political heir will become increasingly important. However, Uzbekistan requires a charismatic leader who can check and balance various elite factions while simultaneously succeeding Karimov and continuing the aging leader’s work of building the nation-state of Uzbekistan. Considering the possible change in the political environment in Uzbekistan, Korea should keep an eye out for other countries in the region as well. Korea must cooperate with neighboring Central Asian countries to prevent drastic changes in Uzbek politics from affecting adversely the potential conflict between the local powers and ethnic groups; and above all, it must pay close attention to and take care of the several million Koryo-in population in the region.

Finally, the status of Koryo-in is falling as they failed to respond actively to social changes in the country, such as emergence of strong nationalism coupled with economic hardships in Uzbekistan since its independence. The efforts by the Korean government and businessmen turned out to be largely unsuccessful in supporting the Korean diaspora in Uzbekistan and rebuilding the network with them after the fall of the former Soviet Union. The main reason for the failure is that the approach was mainly based on trying to make use of the existing network to make inroads into the country rather than giving them support for the mid and long-term with serious consideration for their mutual well-being. Korea, therefore, should help the Koryo-in population regain their social status and political influence in Uzbek society if it wants a genuine strategic partnership beyond the level of 'resource diplomacy’. In this regard, Korea can contribute to establishing higher educational institutions such as Korea-Uzbek universities, professional training centers, and schools for the next generation of Korean diaspora to help them develop skills and incorporate themselves into the mainstream of Uzbek society. Second, it is urgently necessary to construct and maintain up-to-date database of Koryo-in individuals actively involved in various professional areas in Uzbekistan. Third, the Korean government should take every possible step lest the Koryo-in be discriminated against by the local population, by selecting Uzbekistan as a beneficiary country of the Korean ODA project in 2010.

 It is safe to say that with the advent of the 21st century, the so-called, ‘age of post-Cold War, Globalization, and Information’, our future is increasingly dependent upon Asian's power. Asia's rise based on economic growth began with Japan in the 1960s and has been intensified with the rapid growth of the Chinese and Indian economy in the 1990s. The high rate of economic success seen in both countries reflects Asia's strategic significance in the world today.
With the collapse of the Cold regime, we have witnessed that the decentralization in world politics has accelerated the emergence of new powers like Chindia. Thus aggravating  budget deficit of international organizations, potential expansion of regional blocs, and increasing significance of NGOs in international decision-making process. The so-called 'Rise of the rest' resulted in a power shift in world politics as well as a big surge of Chindia. Given these, this research tries to answer the two questions; Under what conditions has India quickly emerged as a new power in Asia and how has it changed its foreign policy toward neighboring countries and is struggling with its own dilemma with respect to Soft Power. Finally, we aim to draw some implications concerning Korea-India collaboration program.
First, this research report examines dynamics of and changes in geopolitics around, below, and above India with respect to foreign policy. International regime changes resulting from the historic turn of the 20th century made many scholars pay more attention to the new characteristics of the post-Cold War regime. Some argue that the unipolar system centering around the United States can hardly maintain itself any longer. The authors would highlight the new transition from unipolar international relations to multi-polar, and to nonpolar ones by taking Haas's definition of 'post-post Cold War world' as nonpolar system.
India has changed its foreign policy rapidly along the dynamic changes in world politics. Nonalignment was a consistent feature of Indian foreign policy during the Cold War period. India pursued ideological commitment to socialism alongside democracy. But, India attempted a radical transition in foreign policy. In particular, India's adoption of the new policy, 'Look East Policy' in the mid-1990s provided a strong platform for India's rise as a big power in world politics. Domestically, India has been also well-equipped with abundant natural resources and environment, continuous economic growth, and military modernization.
Secondly, this research report examines the ups and downs of foreign policy since India's independence from British colonization in 1947. We can categorize India's foreign policy into three periods, each of which reflects significant features of the Indian foreign policy. Several core principle which penetrate all the periods are as follows; (1) India denies any separatist organization or movement and avoids  intervention of any country in domestic issues to promote  social and political integration. (2) India makes efforts to acquire national security from neighboring countries, especially Pakistan. (3) Indian top leaders are always cautious of political security in the national border. (4) India tries to strengthen its leverage in decision-making process within international organizations.
Historically, India has kept close and conflictual relations with the two giants: USA and China. During the Cold regime, India kept distance from the US. In other words, India did not hang on to the possibility of the development of India-US relation but instead pursued Non-Aligned Doctrine (NAD). The collapse of the Soviet Union and Cold regime, however, made India pay more attention to recovering its diplomatic relation with the US in order to fill the political void in world politics. On the other hand, India has kept a conflictual competitive relationship with China concerning the border conflicts since its independence. As India moves on economic transformation and stable foreign relations, it keeps developing friendly relationship with China. Both sides are still on conflictual tract because China aggressively expands into South Asia and the Southeast Asia region to compete with India for natural resources. 
Thirdly, this research report tries to narrow down its focus on Soft Power within India to see if India has developed its own Soft Power with reference to State-Society relation in the world capitalist system. India has been marginalized at the age of globalization until the mid-1980s. Various forms of globalization force provided both opportunity and threat for India. Given these, the authors try to explain how India has responded to external threats by using the concept of 'Cunning State.' To understand India's wise response to globalization, we need to understand multiple relationship between state and civil society from grassroots, to national, to regional and to international level. In addition, we need to check out how global norms are distorted within India in the course of their application to local settings. We believe that the distorting factors are closely related to dilemma the Indian government is struggling with now.
Finally, the report tries to draw some implications on Korea-India collaboration programme based on the analyses. (1) By reviewing thirty-five years of Korea-India diplomatic friendship, the authors would highlight new arrival of the big momentum between Korea and India relations in the 1990s. In January 2010, Korea and India launched a new relationship with the effectuation of 'Comprehensive Economic Partnership Agreements, CEPA). (2) the authors also address the importance of mutual complementing collaboration between Korea and India with respect to economic collaboration, collaborative foreign policy in New Asia Era, and Security Collaboration. In particular, the Korean government needs to actively develop security collaboration with India, not only to accelerate economic trade and collaboration concerning energy and natural resources, but also to promote civil diplomacy such as intellectual exchange and civil society collaboration. For instance, the research on Indian diaspora in Korea will provide a significant database for policy-makers to develop new programs about Korea-India civil exchange.   

In 2009, those of us at KIEP had designated four main research topics we deemed most pertinent to current circumstances, and engaged in twenty major projects in line with those topics. These include negotiations for liberalization of the services market and other multilateral trade issues in response to WTO regime reforms and other changes in the world trading environment; economic cooperation in APEC and other regional issues; and current bilateral trade issues including free trade agreements. KIEP conducted research to address changes in the macroeconomic environment surrounding Korea, such as changes the internationalization of the Korean won as a result of Korea's increasing prominence on the international economic scene, and presented basic resource materials and provided directions to prepare for changes in North Korea. Policy responses to global inequalities in light of the current rapid transnational movement of capital were forwarded, in addition to measures to facilitate Korea's entry into foreign markets and attract foreign investment. In recognition of rising demand for research on the world's regions, KIEP did not limit itself to providing data on Korea's major trading partners such as the US or China, but made efforts to provide basic data on Central/South America and Africa that had hitherto been lacking.

This report suggests mainstreaming of labor market issues in green aid projects. After examining the structure and characteristics of the labor market of developing countries, we present Bangladesh and Tanzania case studies where green aid projects have succeeded in reducing poverty by affecting the regulations, supply and demand of labor. More specifically, we see how a well planned green aid project could tackle the issues of informal labor, high level of unemployment, child labor, low level labor market participation by women, and low level of human capital.
The two case studies – solid waste management program in Tanzania and solar home system program in Bangladesh - show how technology localization, cooperation with international organization and governments, private public partnership, mainstreaming labor issues during the planning stage, investing in human capital, and imposing labor regulations have improved the labor market conditions.

. Introduction
II. Legal Foundations for RTAs under the WTO System
1. WTO-RTA Relationship
2. WTO’s Legal Framework for RTAs

III. Review of RTAs in WTO: A Two-Track Approach
1. Political Track
2. Judicial Track

IV. Some Reflections on Further Clarification and Improvement
1. Linkage between Factual Presentations and Dispute Settlement
2. Linkage between Notification and Dispute Settlement
3. Post-Formation Monitoring System?

V. Conclusion

References

Given different legal regimes which govern the global and regional trading systems, the WTO as such cannot stop the proliferation of RTAs. Nevertheless, the WTO can oversee them through its political and judicial review procedures. Notably, Article XXIV of the GATT, Article V of the GATS and the Enabling Clause contain certain procedural requirements for notification and multilateral review of RTAs concluded by WTO members (political track). In addition, RTAs may be challenged in WTO dispute settlement procedures (judicial track). This paper examines legal provisions and practice of the WTO review mechanisms, explores possible remedies for WTO-inconsistent RTAs, analyzes the transparency mechanism for RTAs, and in particular specific issues of linkage with the WTO judicial review procedures and the possibility of extending the scope of the transparency mechanism to the post-formation period of notified RTAs.

 

In this regard, the materials published herein can be construed as a summary of all the research that has been conducted at KIEP over the past 20 years, or since our foundation in 1990. These include reports prepared by KIEP’s various research teams that have been published such as Policy Research, Regional Economic Focus and Policy Analysis; our research on current issues featured in journals as KIEP World Economy Update; monthly magazines such as KIEP World Economy; the bi-monthly magazine OECD FOCUS; working papers such as the Journal of International Economic Studies; and other periodicals. The research included in this collection can in many ways be regarded as the fruit of the wisdom and sweat dispensed by our research teams since KIEP’s foundation.

Policy Analysis/Policy Analyses I/Conference Proceedings/Korea’s Mid & Long-Term Trade Strategy/Studies in Comprehensive Regional Strategies/Regional Study Series/Trade and Investment Study Series/Policy References I/Working Papers/CNAEC Research Series/SNU-KIEP EU Centre Research Series/Monographs

2009 Summaries of Research Reports

2009 Summaries of Research Reports