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The Background of Russia's Joining the APEC and Russian Policy toward the APEC
The Background of Russia's Joining the APEC and Russian Policy toward the APEC Jae-You Lee, Jae-Young Lee As Russia has joined the APEC this year, it would have an important effect not only on the APEC itself but also on Korea. T..
Jae-You Lee et al. Date 1998.11.01
Economic cooperationDownloadContentSummaryThe Background of Russia's Joining the APEC and Russian Policy toward the APEC Jae-You Lee, Jae-Young Lee As Russia has joined the APEC this year, it would have an important effect not only on the APEC itself but also on Korea. The purpose of this research is to make a contribution for Korean government to establish the desirable policy toward both Russia and the APEC in the future, by examining the background of Russia's joining the APEC and its policy toward APEC.
For this purpose, we will examine the background of Russia's joining the APEC in terms of change of Russian foreign economic policies in Chapter 2. In Chapter 3, first, we will examine what kinds of organizations the former Soviet Union/Russia had operated in order to join the APEC before it became a member of the APEC. The situation of Russia's economic cooperation with other member nations of the APEC will also be examined, focussing on the size of international trade and investments cooperation of Russia in the APEC forum. And then, we will examine the direction of Russian policy toward the APEC in various aspects since its entry to the APEC. Finally, the significance of Russia's admission to the APEC will be contemplated and the prospects of its effect on the APEC will be presented in Chapter 4.
The major motivations of Russia's joining the to APEC are as follows: First, in order to increase Russia's role and influences for overall political, economic processes in the Asia-Pacific area. Second, in order to increase Russia's international cooperation with the nations of the Asia-Pacific area in terms of mutually beneficial trade, investments and cooperation in scientific technology. Third, in order to create a favorable precondition for Russia to solve the socio-economic problems in Siberia and the Far-Eastern area.
Evaluating the APEC highly since activities of its member nations are fairly open and voluntary and it covers broad range of activities such as Liberalization of trade and investments, econo-technological cooperation, Russia looks upon the APEC as a very efficient mechanism for actual and multilateral cooperation in this area. Russia regards energy, transportation, communications, telecommunications, investments cooperation, human resources and economic, technological cooperation as the major promising fields for multilateral cooperation through the APEC.
Russia's entry to the APEC can help to strengthen the military, political security in the Asia-Pacific area and move the center of activities of the APEC to Asia, especially North East Asia. Furthermore, it can offer a more favorable situation to the developing nations in the APEC that are more interested in technological cooperation, controlling the advanced nations such as the U. S. A. that intend to put priority on trade liberalization among the major objectives of the APEC.
However, despite Russia's firm declaration that it would be faithful to the basic principles of the APEC, it seems that Russia's joining the APEC has been significant only in a political aspect, not in an economic aspect, so far. So, Russia's entry to the APEC cannot have fundamental influences on the APEC economically for a while.
In the future, Korea should make more aggressive efforts to produce favorable conditions for economic cooperation with Russia at multilateral levels through the APEC as well as to increase mutual cooperation with Russia at a bilateral level. Korea should not neglect the cooperation in natural resources and energy to which Russia gives priority, and should give more attention to get technology transfer from Russia. -
Barriers to the Flow of Researchers APEC
Barriers to the Flow of Researchers Across APEC Sung Chul Chung, Myung Jin Lee The objectives of this study are to understand the pattern of researcher flows among APEC economies, to identify the barriers to the mobility of resea..
Sung-Chul Chung et al. Date 1998.10.31
Technical cooperationDownloadContentSummaryBarriers to the Flow of Researchers Across APEC Sung Chul Chung, Myung Jin Lee The objectives of this study are to understand the pattern of researcher flows among APEC economies, to identify the barriers to the mobility of researchers, and to derive policy suggestions for the promotion of researcher exchanges across the region. For these purposes, two regional surveys have been undertaken under the joint sponsorship of Japan, Indonesia, and Korea. This study is based on the results of the surveys.
First, individual APEC economies were surveyed in order to obtain data on the inflows and outflows of scientists and engineers. The result shows that the largest recipient of researchers in the region is the United States, and the largest supplier China. It was also found that researchers flow from less developed to developed countries which are stronger in science and technology as well as in industries and offer high-quality advanced education.
Second, individual researchers of the region were also serveyed in order to identify barriers to the flow of scientists and engineers. The survey result tells us that researchers are most attracted by such factors as (1) degree or training programs, (2) quality of life, (3) recognition of the qualifications or experiences obtained in the countries other than the host country, (4) unique scientific and technological resources, (5) excellence of the institutions, (6) research environments, and (7) culture and language. The major barriers to researcher exchange identified by the survey are: (1) cost of living, (2) visa and entry regulations, (3) immigration regulations, (4) housing, and (5) medical services, among others.
Major recommendations are: (1) create an APEC Network of the Centers of Excellence as a medium for scientific interactions based on complementarity and mutuality; (2) develop a regional system of accreditation (academic and/or technical); (3) jointly develop regional visa arrangements to enhance the mobility of qualified scientists and engineers across the region; and (4) develop and implement individual action programs to stimulate and support the development of networks among researchers in the region. -
A Study on the Actual Operation Condition of Hedge Funds and The Cases of Speculative Attacks on Currendies
A Study on the Actual Operation Condition of Hedge Funds and The Cases of Speculative Attacks on Currencies Young-Woo Lee As speculative attacks on currencies by hot money have played an initial role in triggering the financial ..
Young-Woo Lee Date 1998.10.31
Exchange rateDownloadContentSummaryA Study on the Actual Operation Condition of Hedge Funds and The Cases of Speculative Attacks on Currencies Young-Woo Lee As speculative attacks on currencies by hot money have played an initial role in triggering the financial crises, calls for increased monitoring and restrictions on hedge funds targeting such activity have recently gained momentum.
Hedge funds are generally high-yield, high-risk private investment partnerships investing primarily in publicly traded securities, financial derivatives or commodities. The total number of ongoing global hedge funds in operation is estimated to be around 5,000, with approximately $300 billion in assets under management control. These global hedge funds can be divided into US hedge funds and offshore hedge funds. According to estimates, there are about 1,500 Offshore Hedge funds worldwide in 1998, operating assets of over $ 150 billion.
Those offshore hedge funds specializing in foreign currency speculation normally attack overvalued currencies in which its exchange rates are pegged to a major currency that do not properly reflect its underlying fundamental economic conditions. Regardless of their success, currency speculation by hedge funds distorts the international monetary order and the stability of financial markets, because if they do succeed, target countries would suffer heavy losses, where as otherwise, the financial structure of banks and financial institutions related to the hedge funds would deteriorate due to the highly leveraged nature of hedge funds.
As Korea is rapidly liberalizing its foreign currency and capital markets in the aftermath of the outbreak of the financial crisis, any exchange or monetary measures taken inconsistent with macroeconomic fundamentals could open Korea to advance aggressively by speculative hedge funds. Thus, it is essential that the Korean be forever vigilant in operating macro-economic and capital control policies consistent with the fundamentality so as not to provide currency speculators with opportunities, and at the same time, government must closely monitor the flows of hot money in and out of Korea. Furthermore, efficient and prudential regulation of financial sector must be bolstered as should transparency. In this way, hedge funds can not only be monitored more closely, but opportunities for such funds will likely diminish. -
The Structural Reform Experience of Mexico and its Implication for Korea and APEC Countries
The Structural Reform Experience of Mexico and its Implication for Korea and APEC CountriesYoon-Je Cho, Chong-Sup KimThis paper analyzes the financial crisis experiences of Mexico in the 1980s and 1990s, and draws their implicatio..
Yoon-Je Cho et al. Date 1998.10.30
Financial crisisDownloadContentSummaryThe Structural Reform Experience of Mexico and its Implication for Korea and APEC CountriesYoon-Je Cho, Chong-Sup Kim
This paper analyzes the financial crisis experiences of Mexico in the 1980s and 1990s, and draws their implications for the Korean economic adjustments. Our analysis suggests that Mexican experience of the 1980s may be more relevant for the Korean policy makers than that of 1990s since that causes for the financial and currency crisis and the internal and external economic conditions it faced after crisis is more similar to what the Korean economy is facing now. Mexico, despite long years of adjustment efforts in the 1980s, still could not effectively deal with its over-indebtedness of public and private firms, and thereby had to resort to a large scale debt-equity conversion scheme facilitated by the Brady Plan. Even with case of the most recent financial crisis it faced, the Mexican government has not been fully successful in dealing with the nonperforming assets problem of its banking sector. The analysis also suggests that, in both countries, the timing of financial crisis coincided with the timing of transition of government and political uncertainty.
The main challenge facing the Korean economy now is to implement a successful financial and corporate restructuring. For this, the government should do the followings ; (I) mobilization of the sufficient fiscal resources to resolve the banking and other financial sector problem ; (ii) establishment of a clear and detailed plan to link the use of the public funds and the improvement of the efficiency of troubled financial institutions ;(iii) orchestration of the financial restructuring to be linked to the improvement of corporate sector financial structure which is currently over-leveraged ;and (iv) introduction of schemes, such as mutual funds, which lead to the changed composition of Korean financial market between debt and equity inancing. -
ASEM Investment Promotion Action Plan(IPAP) Revisited: Establishing the Groundwork for Regional Investment Initiative
This paper seeks to investigate FDI rule in ASEM, a logical extension of ASEM-IPAP, based on the arguments stemming from the factors hindering FDI flows between the two regions and the impacts of the recent Asian financial turmoil..
Chong Wha Lee Date 1998.10.30
Economic opening, Economic cooperationDownloadContentSummaryThis paper seeks to investigate FDI rule in ASEM, a logical extension of ASEM-IPAP, based on the arguments stemming from the factors hindering FDI flows between the two regions and the impacts of the recent Asian financial turmoil. The barriers to Asia-EU inter-regional FDI are often related to regulatory regimes in Asian countries. However, Asia's future prospects as a destination for profitable FDI remain solid despite the recent financial and economic crisis. Furthermore, it is the EU based multinational firms that express highly favorable attitudes for the Asian countries most affected by the financial crisis.
The ASEM-IPAP has to take into account this new reality and the expectations from both sides. In light of that, the evolution of ASEM-IPAP was viewed through the prism of existing international FDI rules. There will be four directions for the medium- to long-term evolution of ASEM-IPAP: promote the development of a legal environment which is conductive to investment without any legal mandatory rules like EU-MERCOSUR Interregional Framework Cooperation; shape a non-binding regional investment initiative such as the one in place in APEC; frame a binding regional investment agreement similar to NAFTA; and accede to the MAI once the treaty is concluded. Each needs to be assessed carefully to respond to expectations of ASEM members, which may be quite divergent at the moment. But as the process moves on, there is certainly positive, common agreements which could be further developed and enhanced and ultimately result in positive benefits for all ASEM members. -
Open Markets Matter: The Benefits of Trade and Investment Liberalisation
The purpose of this paper is to help the Korean people understand that open markets bring foreign capital and trade activity. Furthermore, investment liberalization can benefit current corporate and financial restructuring attempt..
Chan Hyun Sohn Date 1998.10.25
Economic openingDownloadContentSummaryThe purpose of this paper is to help the Korean people understand that open markets bring foreign capital and trade activity. Furthermore, investment liberalization can benefit current corporate and financial restructuring attempts and enhance the efficiency of the Korean economy. Accordingly, this paper recommends that the Korean government should identify the possible side effects of investment liberalization and formulates its policy responses. -
Recent Development in Korea's Export Structure and Prospects on Korea's Exports
Recent Developments in Korea's Export Structure and Prospects on Korea's Exports Inkyo Cheong, Chang Jae Lee Though the importance of exports is emphasized as a mean of overcoming the current financial crisis, the performance of ..
Inkyo Cheong et al. Date 1998.10.25
Trade structureDownloadContentSummaryRecent Developments in Korea's Export Structure and Prospects on Korea's Exports Inkyo Cheong, Chang Jae Lee Though the importance of exports is emphasized as a mean of overcoming the current financial crisis, the performance of Korea's exports has very poor since May of this year. This paper is concerned with the causes for the recent poor export performance and predicting future export prospects by region and commodity. The authors found that worsening external economic conditions were more important than internal economic conditions for Korea's recent poor export performance, and predicted that external economic conditions for next year would be worse than this year.
While Korean policymakers can do little to revive external demands, the authors suggest the adoption of trade promotion policies, such as an automatic discount system by the Bank of Korea, temporary relaxation (removal) of credit limits for large companies, strategic economic alliance, etc. -
Korea and Central America
■ Central American Countries in the past decade have rapidly achieved democratic as well as economic stability. Sustained economic growth, increased foreign investment, exchange rate stability and low inflation rates have transfo..
Won-Ho Kim Date 1998.10.20
Economic cooperationDownloadContentSummary■ Central American Countries in the past decade have rapidly achieved democratic as well as economic stability. Sustained economic growth, increased foreign investment, exchange rate stability and low inflation rates have transformed the region's economic outlook in a strongly positive direction. Central America not only possesses abundant tourist resources, but also an advantageous geographic location at the crossroads of North and South America, and the Atlantic and Pacific. Central America also benefits from preferential tariff rates with the United States and EU, which are enhancing the position of Central America as a new and invaluable market of trade and investment.
■ The Central American Common Market (CACM), created in 1960, experienced a serious collapse of confidence in the 1980s due to the political and economic problems in the region. However, the CACM has reversed course and is now entering a new era of development, taking advantage of the political and economic stability in the region. The CACM is not only deepening the economic integration in the region, but is also strengthening its relations with the EU, and actively is promoting the formation of the Free Trade Area of Americas (FTAA).
■ Due to the geographical and cultural distance between Central America and Asia, the extent of cooperation between the two regions had remained relatively insignificant. However, relations between the two regions are now making remarkable progress owing to Central America's increasingly large potential for economic growth and development derived from its commitment to liberalize trade and investment, while maintaining macro-economic stability. In particular, Korea's cooperative relations with Central America will be strengthened by the establishment of Korea-Central America Forum for Dialogue and Cooperation, the brainchild of the 1996 Korea-Central America Summit, and by Korean firms increasing trade and investment in the region. -
Technology Cooperation in the APEC
This research is undertaken to have a close look at the current status of technology cooperation in the broad context of ECOTECH drawing on the case of the APII(Asia-Pacific Information Infrastructure). The expectations were such ..
Byung-il Choi et al. Date 1998.10.14
Technical cooperationDownloadContentSummaryThis research is undertaken to have a close look at the current status of technology cooperation in the broad context of ECOTECH drawing on the case of the APII(Asia-Pacific Information Infrastructure).
The expectations were such that the pursuit of the APII would help to reduce disparities among the APEC member economies in telecommunications and information sector. Statistical analysis of telecom infrastructure of member economies reveals that, despite rapid growth of the developing economies, disparities between the developed and developing economies show no sign of reducing. The analysis of the activities of telecom working group(TEL) at the APEC shows that, even though the TEL strives for a balanced attainment of the goal of TILF and ECOTECH, more weight is geared towards TILF. Many activities on ECOTECH remains small-scale event-type lacking enthusiastic participation of private/business sector from developed countries. The paper calls for a more balanced treatment of ECOTECH and TILF for reducing disparities in telecom sector. -
A Study on the Adoption of EU Information Network Model in APEC Region
A Study on The Adoption of EU Information Network Model In APEC Region Kwon, Tae Hyoung; Won, Chong-Keun; Lee, Sang-Woo; Joo, Jae-Beom; Shin, Bongsup In this paper we attempt to investigate the possibility of whether or not the i..
Tae-Hyong Kwon et al. Date 1998.10.14
DownloadContentSummaryA Study on The Adoption of EU Information Network Model In APEC Region Kwon, Tae Hyoung; Won, Chong-Keun; Lee, Sang-Woo; Joo, Jae-Beom; Shin, Bongsup
In this paper we attempt to investigate the possibility of whether or not the information network found in the EU can be applied to APEC. At the end of our investigation, we make some suggestions thought to be essential for the establishment of an EU type information network in the area. This research begin by reviewing the existing literature on the area of 'organizational changes and control'. The following are our findings from this review : i) there are close relationships between the following three aspects-organizational strategies, structure and environment. Individual organizations have to account for them before making any decision about organizational structure. ii) only if the three are in a good harmony can an established organizational structure be expected to offer a reasonable degree of efficiency and effectiveness. iii) organizational changes are not just determined by the environment which an organization faces. But before making a decision, the main actors of the organization consider their objectives and existing organizational structure as well as the environment. This process is usually subject to negotiations and political struggles.
To characterize the information network found in the EU, the European Documentation Center (EDC) and the European Information Center (EIC) networks, which are considered to be dominant in the area, are chosen for analysis. The activities of these two networks are carried out under the support of the European Commission. The two share the regulations of the information flow and the activities of small and medium firms within the EU. But the immediate situations faced by each are not the same. The two also operate different type of networks under different types of strategic supports. We have found that the type of information supplied by each network is not identical. The EIC supplies business information, particularly for small-medium firms within the EU, while the information for academic research on the EU is supplied by the EDC. Our analysis showed that, owing to higher resource dependence, geographical advantage and the supply of business-related information, combined with highly formalized, decentralized and complex organizational structures, and the variety of strategic supports, the EIC has become more efficient and effective than the EDC.
Given these findings, we then compare APEC and the EU. Various differences were noticed. Although APEC has initiated a plan called APII to develop an information-infrastructure within the area, this still remains at the infant stage. The unformalized and centralized structure seen in APEC was another constraint upon the efficient use of the EU-type information network, particularly the EIC network. There are no regulations concerning the information flow and the activities of small-medium firms within APEC. The uneven level of development of information-related technologies between member states, geographical disadvantage and the low level of integration also emerged as a hinderance to the adaptation of the EU network. We therefore conclude that, given the current situational and organizational characteristics found in APEC, the possibility that this could lead to the same degree of efficiency and effectiveness as the EU has experienced is presently small. But, at least, it can be said that the EU network offers a very useful model which could be used to make a number of significant improvement to the area of information networks.
Finally, we make a few suggestions which we consider essential for the establishment of an EU type network in APEC. In brief there are as follows: a careful investigation of the information market with APEC; the development of information-related technological infra; the regulation of the information flow and the activities of small-medium firms; the formalisation and decentralization of the central organizational structure ; the development of APII as a relevant strategy; and the supply of business-related information.
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