Korea Must Help Stabilize the G20

In an opening speech at the G20 Finance Ministers and Central Bank Governors Meeting in Gyeongju, North Gyeongsang Province on Friday, President Lee Myung-bak made some important points. First, stressing the need to continue the framework of international cooperation centered on the G20, Lee said, "We must implement the framework agreed upon at the Pittsburgh Summit in order to ensure continued economic growth, while simultaneously resolving global economic imbalances."

Lee also represented the position of the world's developing countries, pointing out that countries which are not members of the G20 are extremely interested in the agreements reached at the summit. "Aiding the economic growth of developing countries is a way to create new demand that will support global economic recovery," he said.

Lee then emphasized the need to reach an agreement on currency resolutions and make changes in the IMF's quota system by the promised time frame in order to bolster the integrity of the G20.

The purpose of the meeting in Gyeongju was to lay the groundwork for the G20 Summit in Seoul on Nov. 11 and 12. The summit is the focus of international attention as a currency war between the U.S. and China threatens to shake the cooperative framework amid a shaky recovery from the global financial crisis. But the prospects for a solution at the summit are not bright. Most importantly, analysts say it will not be easy for the leaders of the G20 to agree on contentious issues fueling the currency war and consent to radical changes in the IMF quota system.

That makes the role of Korea, the host of the G20 Summit, even more important. Even if member countries may fail to reach a comprehensive agreement on all terms, they need to reconfirm their faith in international cooperation and ensure that the currency war does not escalate into a global trade conflict by establishing a final line of defense. The world realized that the G7 system was no longer enough to overcome global economic crises. But if the G20 fails as well, the entire global economy stands to suffer.