EFN Asia panel at Jeju Forum 2017

The Economic Freedom Network (EFN) Asia participated once more at the annual Jeju Forum for Peace and Prosperity, a big international conference held at Jeju Island, S. Korea. I am reposting this report submitted to the organizers within an hour after the panel discussion. Originally posted at the EFN website.

I add two photos here, taken from EFN’s fb page. From left: Wan, John, Razeen, Young-Han.

This is 3,200+ words, 7 pages, enjoy.
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Session Outline

Name of Session: Asia’s Contribution to the Global Open Market
Session Organizer: Friedrich Naumann Foundation for Freedom
Date: 1 June 2017, 14.50-16.20
Moderator: Dr. John Delury, Associate Professor, Graduate School of International Studies, Yonsei University
Welcoming Remarks: Dr. Lars-André Richter, Head Friedrich Naumann Foundation for Freedom Korea Office

Discussant(s)

Dr. Razeen Sally, Associate Professor,
Lee Kuan Yew School of Public Policy, National University of Singapore

Wan Saiful Wan Jan, Chief Executive
Institute for Democracy and Economic Affairs, Malaysia

Dr. Kim Young-Han, Professor, Department of Economics, Sungkyunkwan University

Summary of Presenters & Discussants’ Remarks

Dr. Lars-Andre Richter

Friedrich Naumann Foundation (FNF) is a German non-profit organization, founded in 1958 post-war West Germany. The main goal at the time was to help re-establish democracy in West Germany. Shortly after, FNF opened offices abroad, including in Tunisia, India and Indonesia. The office in Korea was opened in 1987. We promote liberty in Korea through a variety of programs including democracy building, projects with market economy, human rights, rule of law and also the re-unification issue, bringing in the unique German experience of re-unification. In fact, FNF has projects in both Koreas. The North Korea program started in 2004, focusing on economic policy. The session today at the Jeju Forum is hosted by both FNF and Economic Freedom Network Asia (EFN Asia), FNF support’s network of liberal minded think tanks and individuals.

(From left: Wan, John, Razeen, Lars, Young-Han)

Dr. Kim Young-Han

Threat of the Protectionism by the US Trump Presidency

– Why Protectionism by the Billionaire US President?

Trump thinks that the current format of ‘the Global Open Market System’is unbearable and unsustainable for the US blue collar workers. Are US blue collar workers simply irrational? No, they are absolutely rational.

– The US blue collar workers know that there is not and will not be an effective trade adjustment assistance system in the US. Winners get everything with no room for losers in global open market according to the US experiences. (The same with the Brexit case.)

– How much of a threat caused by the Trumpian Protectionism?

Very threatening and disastrous. If Trumpian Protectionism is spilled over to major trading countries, the global trade war is the next stage, just like the experience before the two World War. The current one-sided protective measures of the US are highly likely to provoke retaliatory measures from trading partners.

– Is Trumpian Protectionism Sustainable?

Not really, since it’s self-defeating. Why? The source of gains from free trade: Efficiency Gains via Reallocation of economic resource from inefficient sectors to efficient sectors. In the US, without the effective trade adjustment assistance mechanism, resources in the inefficient sectors became laid-off instead of being reallocated. What Trump tries to do is to keep inefficient sectors protected as inefficient, which is self-defeating and unsustainable. He suspects Trump will realize this after 3-4 years.

– Can other powers fill in the US role?

The Share in the Global Trade: EU takes roughly 40% of the world trade, followed by Asia which takes 33%, and North America (17%). If the US goes back to protective regime, it is bad, while the other players can keep the remaining 83% under free trade regime. The EU might play a more meaningful role in leading the global free trade regime and also Asian powers like China. But he does not think so.

– The requirements for the leadership the global free trade regime: Leader has to prepare itself and operate on a rule-based trade policy and National Treatment for all players (treat all players as domestic players). The EU is more prepared, but not China. Furthermore, Big Players with market power are likely to resort to bilateral arrangements based on one-sided bargaining power. Therefore, relying on a multilateral platform is better than relying on a big guy leading power. Rebuilding the Multilateral Free Trade Regime via WTO is the solution.

The Role of Asia in Rebuilding the Global Free Trade Regime

– Datawise, Asia takes significant market power, i.e. 33% of the global trade. Historically speaking, all Asian countries’ economies, such as Japan and South Korea, have emerged via the global free trade regime with no regret against the multilateral free trade regime, WTO. A multilateral free trade regime as WTO is welfare dominant to a single country leadership (by whether the US or China). Asia has kept the spirit of multilateral or plurilateral free trade regime via ASEAN and ASEAN+3, and even ASEAN +6. Asian economy with her complexity in terms of diverse stages of economic development and asymmetry of economic size and power works as a miniature of the global economy with gradual and sustainable unit of economic integration.

– Condition for “Sustainable Global Open Market System”

1. i) Effective Trade Adjustment Assistance Mechanism: Losers (i.e., workers in the importing competing sectors with comparative disadvantages) should be reallocated to Winners’ sectors (jobs in the export sectors with comparative advantages) via Effective Trade Adjustment Assistance Mechanism.

1. ii) Multilateral Free Trade Regime with strong surveillance and reputation building mechanism with respect to the Big Guys with market power.

Dr. Razeen Sally

He has three main points to make. First, where we are in the global economy, particularly on trade. Second is on protectionist threat. Third is on what can be done in and by Asia to keep the market open.

– Where are we in the global economy?

Economic globalization has not been reversed, since the global financial crisis, but it has stalled. There has been a global growth slowdown. Trade to GDP worldwide has not increased, since about 2006. Foreign direct investment flow has decreased, since the crisis Cross-border flow of finance has Decreased considerably, as expect from the global financial crisis.

– But particularly on trade, something unusual is going on. Since the beginning of 19^th century until 2008, world trade grew faster than world output, which is the indication that trade is the engine of growth. But since 2012 until the end of 2016, trade growth barely kept pace with world GDP growth at about 3 percent or less. This is highly unusual and tends not to happen except in war and deep recession. This is particularly worrisome for Asian nations, whom depend on exports. But still too early to tell if this is a new trend.

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Pett Jarupaiboon and secretariat work

* Originally posted on April 24, 2014.

I have written a number of papers about the Economic Freedom Network (EFN) Asia, especially its annual conferences in different cities in Asia. Such big regional event for many independent think tanks and academics is made possible not only by the financial support of the Friedrich Naumann Foundation for Freedom (FNF) but also by the hard work put by the EFN Secretariat staff.

The head of the Secretariat is the Regional Program Officer for EFN, Pett Jarupaiboon. Here, Pett is talking to Fred McMahon of Fraser Institute (Canada) during the EFN 2013 Conference in Bangkok last year.

Pett joined the FNF in 2009 I think, taking the place of Gorawut Numnak. I met Pett first time in 2010 during the EFN Confernce in Jakarta. The guy is your typical silent, always smiling but very hard working person. Aside from being the regional officer for EFN, he is also the regional officer for Human Rights campaign of the FNF.

Last year, EFN participated for the first time in the Jeju Forum for Peace and Prosperity, a big annual international conference held in Jeju island, S. Korea  Photo in one of the three dinners in the conference, the EFN video was shown on the stage. Barun Mitra, Pett, me.

EFN sponsored one panel in the 2 1/2 days conference about the dangers of economic nationalism and protectionism. Pett worked hard for that event, in coordination with FNF Seoul office, especially with Ms. Sung eun Lim, another hard working staff of the foundation.

At Jeju conference, below. From left: Sung-eun Lim, me, Ms. Kim, Wan Saiful Wan Jan (Malaysia), Lars Richter (Country Director for S. Korea), Pham Chi Lan (Vietnam), Feng Xingyuan (China), Tricia Yeoh (Malaysia), Pett, Barun Mitra (India), Miklos Romandy (Austria), Liu Junning (China). Not in the photo with our group was Sam Raimsey (Cambodia).

EFN 2013 Conference in Bangkok, farewell dinner. From left: Mao Shoulong (China), Barun, Rainer Adam (outgoing FNF Regional Director for Southeast and East Asia), Xingyuan, Wan Saiful, Pett, Tricia, Sung eun, me.

Thanks for all the hard work Pett. Happy birthday.

More photos at the Jeju Forum

* Originally posted on June 06, 2013.

Our panel, the EFN Asia and FNF panel, during the recently concluded Jeju Forum for Peace and Prosperity, May 29-31, 2013, was held in the afternoon of Day 2, May 30. While some panels have mostly if not entirely Korean speakers and facilitator, our panel has speakers and moderator from six countries. Two from Malaysia, Wan Saiful Wan Jan (moderator) of IDEAS and Tricia Yeoh of Institute Rakyat, two from China, Feng Xingyuan and Liu Junning, main speaker from Cambodia, Sam Rainsy. Other discussants were from Vietnam, Pham Chi Lan; from India, Barun Mitra of Liberty Institute, and Choi Byung-Il from S. Korea. I was the Rapporteur, that’s seven countries represented.

The audience was big, mostly Korean university students, then other Korean and international participants.

The Resident Representative of the Friedrich Naumann Foundation for Freedom (FNF) in Korea, Lars Andre Richter, a German, gave a brief opening remarks — that’s eight countries already in our panel, really an international panel. Lars introduced what the FNF and EFN Asia are, their activities to promote freedom and liberty around the world, especially in Asia.

The group photo after the panel. German Ambassador to Korea, Rolf Mafael, gave the closing remarks. In the photo below, he is 5th from left. He was supposed to give a short closing remarks, perhaps 1 or 2 minutes, but he enjoyed listening to the panel and spoke for about five minutes. The audience like his talk because he gave a European, specifically German, perspective on the subject of economic nationalism. See my Rapporteur’s Report about the panel.

On our first night at the forum, May 29, we were the last group to leave the dinner table. Before finally leaving the grand ballroom, we had a group photo, below. We were 13 people who travelled from Seoul that afternoon, including two staff of FNF Korea, Sungeun Lim and Ms. Kim, and Pett Jurapaiboon, the Reginal Program Officer of EFN Asia, based in Bangkok. In this photo below, only Sam Rainsy was absent because he went ahead.

On the second night, another dinner at the grand ballroom. The Jeju Forum organizers showed the EFN Asia video on the stage several times, wow. Barun Mitra and Pett Jurapaiboon with me, the EFN video on our background as it was being shown.

The third and farewell dinner, May 31. This was taken by one of the young staff of the Forum, Ms. Summer Kim.

The previous day, Ms. Kim and her two other fellow young staff interviewed me. They have read my previous articles about the Forum, weeks before we attended the event and they said they liked it. They asked me how I came to participate in the forum, I said it was EFN Asia and FNF which brought us to the event. They also asked if I have any comment how the event was organized, I said that everything was running smoothly, I have zero complaint, they and the Forum organizers are very efficient. Ms. Kim also sent this photo, minutes before the video interview.

Once again, thanks to EFN Asia and the FNF for hosting that panel and for bringing me and other panel participants to Seoul and Jeju. It was a great learning experience, as usual.

Jeju Forum 2013, on think tank independence

* Originally posted on May 31, 2013.

Jeju — Today is our third day here in the Jeju Forum for Peace and Prosperity held in this big and sprawling Haevichi Hotel&Resort, southern island of South Korea. I am one of the 13 people from the EFN Asia and FNF Korea team who came here from Seoul last Wednesday, led by Lars Andre Richter, the Country Representative of FNF Korea (5th from left), and Pett Jurapaiboon of EFN Asia (4th from right). Our group photo on our first night here. Only Sam Rainsy from Cambodia not present here.

On Day 1 (May 29) afternoon, I attended session [2-A], “Making Ideas Work: Challenges and Opportunities for Think Tanks in Asia”.

The moderator was LEE, Chung Hee, Professor, Hankuk University of Foreign Studies, and the Presenter was YI, Seong-Woo, Researcher, Jeju Peace Institute.

The four discussants were:

KANG, Kyung-Tae, Professor, Silla University, S. Korea
Kawaguchi, Shuji, Researcher, Mitsubishi Research Institute (MRI), Japan
WANG, Yao, General Director, Boao Forum, China
Michael YEOH, Manager, Asia Strategy & Leadership Institute.Research Center (ASLI), Malaysia

Dr. Yi mentioned at the start that the University of Pennsylvania’s Think Tanks and Civil Society Program (TTCSP) has listed two Japanese and three Chinese institutions in the world’s 50 best think tanks, and none from Korea. So the Koreans are wondering how to strengthen the competitiveness of their think tanks.

Among the factors identified to attain this is autonomy of think tanks from big businesses and government funding, consistent research topics and direction and strengthen specialization, balance relevance, influence and independence, and involve civil society.
Among the slides he showed, is on Missions of Universities (knowledge production and consumption, teaching) and Institutes (knowledge production and consumption, advising). Their shared mission is Research.

Mr. Kang said that the Samsung Economic Research Institute (SERI) is perhaps the best think tank in Korea, with wide range of research areas from engineering to economics, especially after the 1997 financial crisis, it expanded its research work beyond science and engineering. But SERI is for Samsung mainly, not for the entire country.

The Korea Development Institute (KDI) was powerful in the 80s but not so now.

Mr. Kawaguchi said that their think tank also has varied research areas but the bulk is on engineering, 58 percent of total resources devoted to various engineering R&D, then 20 percent for basic science, 11 percent economics, and 5 percent each on law and politics, and sociology. I was wondering why Mitsubishi would be interested in sociology, perhaps to help them understand consumer behavior in other countries and cultures.

He added that think tanks in Japan, started in 1970s. The bureaucracy drove Japan’s growth after WW2 as the bureaucrats made more initiatives than the politicians. Among the other influential Japanese think tanks he mentioned are the Japan Institute of International Affairs, Institute for International Policy Studies, International House of Japan, Research Institute for Peace and Security, and Japan Center for International Exchange.

He also noted that in the US model of think tanks, they are mostly privately funded, independent from government. In developing countries though, they are mostly supported or funded by governments.

Mr. Yeoh of ASLI in Malysia said that those think tanks that have clear strategic vision are more successful. They have active engagement with many sectors, public, private and civil society. They have good communications strategy in mainstream and social media. And have good monitoring and feedback mechanism to trace their effectiveness.

In addition, successful independent think tanks focus more on applied research, leave basic research to universities. They are able to maintain their independence by getting funding from different and diverse sources. In particular, they should not get any funding from government.

Among the specialized areas that think tanks should deal and do more research are on regional and trade integration, environmental studies, CC, inclusive growth, disease control, etc.

There was a short open forum after the discussants have spoken. I was the last to make a comment/question from the audience as time was running out. I said that governments now are the main creators of economic uncertainties and instability, like what is happening in Europe, the US fiscal cliff, Japan, etc. Their huge and rising public debt is the main generator of such instability. Government think tanks including the multilaterals like the WB, IMF, ADB, are the rah-rah boys of more spending, with recent magic words like “inclusive growth” and fighting inequality, on top of fighting climate change.

Thus, think tanks should be more independent from government, and check further expansion of government spending and roles.

Liberals meet liberals in Seoul, 2013

* This is my article at the EFN Asia website on May 29, 2013.

Seoul — Liberalism is a political ideology that advocates liberating the individual from excessive and unnecessary coercion. Such coercion includes over-regulation and taxation of individuals and private enterprises, or prohibiting people where and to whom they can freely trade their goods and services. People who subscribe to this ideology are called liberals in Europe and Asia. In the US, the term was hijacked to mean the opposite, the lovers of more state coercion. So they are called libertarians in the US.

So liberalism is a great ideology. And liberals and libertarians are generally great people for giving prominence to individual freedom, individual responsibility, free market, free trade, tolerance of diversity, and rule of law.

Last night was a great evening billed “Liberals meet Liberals” organized by the Friedrich Naumann Foundation for Freedom (FNF) Korea. It was held at Koreana Hotel in the heart of the capital city of South Korea. A small but intimate gathering of participants from China, India, Germany, Korea, Malaysia, Philippines, Thailand, and Vietnam.

Dr. Lars Andre Richter, the Resident Representative of FNF Korea gave an inspiring introduction of the work being done by his office to promote freedom. Then Minister and Head of Mission, German Embassy in Korea, Johannes Regenbrecht, gave a short talk that the German government is supporting initiatives to promote freedom and democracy worldwide. Jaykun Yoo, CEO of Christian Global Network TV also gave a short talk on the value of promoting liberal ideas to the public.

Pett Jarupaiboon, Regional Program Officer of Economic Freedom Network (EFN) Asia, gave an introduction of EFN Asia and what it is doing. He showed a video about the network, produced by Asia Freedom TV and the network, wow.

The main talk was given by Dr. Chung-ho Kim, Professor of Economics at Yonsei University in Seoul. He used to be the President of the Center for Free Enterprise (CFE) and is now putting up a new free market think tank, the Freedom Factory Ltd. See an earlier article about him here.

Dr. Kim’s lecture was entitled “The Challenge for Liberals in Korea” and he gave a short rap before his talk, to the delight of the audience. No wonder he is called the “Freedom Rapper” with several short videos in youtube.

The big challenge for liberals and libertarians in Korea is that many people have accepted the strong state intervention philosophy, even among intellectuals and academics. The usual lectures do not appeal much even to the young people. So what they did, they produced several youtube clips about freedom and liberty, in rap music with dance component. This has attracted the attention of many people in Korea, especially among the youth.

He showed that before, there were only about three of them in Seoul promoting libertarianism. This has changed now as thousands of people, the young and university students in particular, are now are attending his lectures about liberalism and the libertarian philosophy. So there is hope.

A few weeks ago, he announced in facebook and other social media that he is inviting investors from the public to put up a new independent and free market think tank, the Freedom Factory Ltd. As of last night, he has received emails from 150 people, many he does not know personally, expressing support to invest. Their combined pledge has topped $70,000 already and more should come.

Dr. Kim is introducing new schemes in putting up and funding a free market think tank. And he is spreading the philosophy to more and more people. The open forum that followed was very lively, that the event moderator, Tricia Yeoh of Rakyat Institut in Malaysia, has to stopped more questions as dinner was becoming late.

Lars Andre gave a toast to freedom before dinner was served. And over dinner, discussions continued in each table. Food was nice.

When liberals meet liberals, they naturally share ideas and stories how to further promote freedom and liberty. There is always hope, there are always new ways and schemes, to advance the philosophy of liberalism.

Participation in Jeju Forum for Peace and Prosperity, 2013 conference

* Originally posted on March 19, 2013.

The Economic Freedom Network (EFN) Asia will be participating in the Jeju Forum for Peace and Prosperity 2013 Conference this coming May 29-31, 2013, to be held at Haevichi Hotel and Resort Jeju, S. Korea. I think this will be the first time that the network  will join this big international conference held yearly in the southern island of Jeju. The Friedrich Naumann Foundation for Liberty (FNF) Korea Office is working with the EFN Asia Secretariat in Bangkok in the network’s participation.

This forum was invented in 2001 meant for a regional dialogue to promote peace and prosperity in Asia, the Korean Peninsula in particular. Then it became successful in attracting more regional and international participants, it later became a big international conference held every two years, then made an annual event since 2011.

I have heard and read about this forum in some news reports in the past, but I did not pay much attention to it. I thought it is just an extension dialogue of the famous World Economic Forum (WEF) held annually in Davos, Switzerland.

Early this month, the Regional Programme Officer of FNF for Economic Freedom and Human Rights, Pett Jurapaiboon, invited me to be the rapporteur of one of the panels in the Jeju Forum, and that panel will feature important and known speakers within EFN Asia.  I immediately said Yes to Pett. Well, my batting average for all FNF invites, whether here in Manila or the regional office, has been 100 percent so far. I will be a rapporteur, not speaker, in a panel on Economic Prosperity in Asia : Dealing with Economic Nationalism, to be held in the afternoon of May 30. Thanks much, Pett. I am very excited to attend this big international conference.

My interest in joining this and other regional events like the EFN Asia annual conferences, is simple: learn more how we can achieve regional and global peace and prosperity. Peace and economic prosperity.

Enough of war, armed conflict and militarization of disputes that can be peacefully resolved through diplomacy and serious, honest dialogues. Enough of spending huge amount of taxpayers money to buy heavy instruments of war and destruction.

Enough of economic restrictions and prohibitions that create poverty. If people, rich and poor alike, want to start a food shop ala “carinderia” in the Philippines or a modest housing or big residential condo, so be it. Governments should not put too many regulations, restrictions and taxes for these useful human endeavor that create jobs and provide useful goods and services to the people.

So EFN Asia’s chosen topic, dealing with economic nationalism, is timely and important. Economic nationalism and protectionism means only one thing: reduction of choices and options, reduction of human freedom, to choose products and services that can best serve their personal and enterprise needs and priorities. When national governments say to its people, “You cannot buy these goods from other countries at these prices. Better buy only from locally-made products, or buy the imported ones at high prices and limited quantity”, that is limiting choice and freedom.

The same way, when national governments also declare to its citizens, “You cannot study or work abroad unless you comply with these requirements…” and list down a dozen prerequisites, taxes and fees to pay as if one is applying to be a criminal abroad, that too, is limiting choice and freedom. Some poor job applicants to work abroad become poorer as they sell some personal and family properties so they can pay those multiple fees and taxes, both to the government and the favored job placement agencies and corporations that were accredited by the government.

The topics in the 2 1/2 days forum are wide. To accommodate those different topics, four to five simultaneous discussions will be held. Here is the list of topics on the afternoon of Day 2, May 30.