In This Review
The Political Economy of Korea-United States Cooperation

The Political Economy of Korea-United States Cooperation

Edited by C. Fred Bergsten and Il Sakong

Institute for International Economics, 1995, 109 pp.

This useful volume is the first product of the Korea-United States 21st Century Council, a forum launched in 1994 to bring together top officials, private sector leaders, and policy-oriented researchers. One of the prominent themes is the extreme displeasure of the U.S. business community as regards the South Korean investment climate. As Lawrence B. Krause puts it, although many American firms have formed partnerships with Korean firms, "a significant number have been unsatisfactory for the American side." Difficulties have included inadequate protection of intellectual property rights, restricted access to the Korean market, and excessive government interference with business that works disproportionately against foreign firms.

Robert Zoellick, a former Bush administration official, cites customs rules and product standards that are used to thwart importers, complains about anti-import campaigns and the caricaturing of foreign trade officials, and warns that these actions "paint an international image of Korea that is, to be frank, terrible."

According to the editors, the response to these charges from the Korean participants was mixed. Some readily acknowledged that the problem remains serious. Others were resentful, suggesting that only American investors have difficulties in Korea while those from Europe and Japan have been doing well. Despite these difficulties, the conference participants were mostly optimistic about the prospects for improving the Korean investment climate, given the current South Korean administration's commitment to reform.