My fellow Koreans,

On the night of June 10 when the streets of Gwanghwamun were lit with numerous candles, I gazed out upon those endless lines of flames from the hill behind Cheong Wa Dae. In the outcries of the protesters, I could hear the tune of one of my favorite old popular songs, “Morning Dew.”

Sitting alone on the dark hillside and looking at the downtown area swarming with people holding candles, I reproached myself for not having been able to serve the people well and ease their concerns. I thought deeply about the situation over and over until late at night. I looked back on what I had done again and again.

I have recently had chances to meet leaders from various sectors of society and listened to their advice. They advised me, “You should not carry everything all on your own, but be more candid with the people and seektheir understanding.”

Following their recommendations, I stand here today to frankly explain what has happened so far, ask for your understanding and make an apology. At the same time, I will outline the direction for state affairs in the coming years. I resolve to make a new beginning.

In retrospect, I have been impatient since I was elected President. In light of the experiences of previous administrations, I believed that I would not be able to succeed unless I brought about changes and reforms within my first year in office.

Moreover, world economic conditions were rapidly deteriorating around the time of my inauguration. Coupled with a global financial crisis, the prices of oil and raw materials were also skyrocketing with no limits in sight.

It seemed to me that I urgently needed to enhance the country’s economic competitiveness in order to overcome these difficulties and join the ranks of advanced nations. In my judgment, ratification of the KORUS FTA would serve as one of the shortcuts for Korea to improve the nation’s growth potential.

Many predicted that it would be impossible to have the KORUS FTA bill passed within this year if we continued to reject U.S. beef imports. It was also expected that we might be embroiled in a trade conflict with the United States. Whether we liked it or not, I thought we could not avoid negotiations on beef imports.

Once the KORUS FTA takes effect, it is projected that about 340,000 decent jobs will be created and the country’s GDP will rise more than six percent over the next decade.

As President, I did not want to let this golden opportunity slip away. I could not sit idly by without making any effort and just watch the door of opportunities being slammed shut.

Korea is the only remaining country in the world divided by Cold-War rivalries. The interests of the four major powers converge on the peninsula. In addition, the country has been haunted by threats from the North Korean nuclear program. From a security perspective, we cannot afford to delay the effort to restore the somewhat strained relations with the United States.

Under these circumstances, I lost sight of the need to consider the public demand about food safety more meticulously. I was not able to accurately read the mind of mothers who worry about their children’s health even more than their own.

No matter how urgent it was for me to address pending national issues, I should have given more careful thought to how the public would react and what the people really wanted. The Government and I are now reflecting on these points with excruciating pain.

Currently, the Government is doing its utmost by mobilizing all possible diplomatic capabilities. The ultimate goal is to address public concerns about food safety in a manner that does not go against international standards and cause trade disputes. On June 7, 2008, I made our position crystal clear to U.S. President George W. Bush. Accordingly, trade delegations representing both countries are now engaged in negotiations. As long as the public opposes it, I will make sure that U.S. beef from cattle older than 30 months is not served on Korean tables under any circumstances.

The Government will also secure firm assurances on this issue from the U.S. Government. I anticipate that the United State will honor what the people of one of its allies want.

The Government will use this incident as an opportunity to take exhaustive measures to guarantee watertight food safety.

Fellow citizens,

Up until now, the Korean people have demanded that Korea engage in renegotiations with the United States. However, the Government’s efforts were only focused on explanations about the difficulty of resuming the negotiations. This way of handling the issue by the Government might have been understood as a refusal to follow the public demands.

In the face of increasing public demands for renegotiations, some politicians suggested that I agree to renegotiations first and see what happens later. Furthermore, they continued to urge me to accept the demand in order to calm the current situation down right away regardless of possible trade disputes or harm to the national interest.

If it were a domestic issue, we would have done as they wished. I would not have hesitated if I could just take into consideration my political standing.If I announced that we would engage in renegotiations, we might have been able to tide over the current difficulties temporarily. Thus, I agonized a lot over this issue. Why should I hold fast to my conviction when my approval rating plummeted and all sorts of criticisms mounted up?

As President of the Republic of Korea, however, I could not help but safeguard the national interest and consider the future of the country. I could not proceed clearly knowing that there would be unspeakable repercussions.

As you may remember, the so-called “garlic war” erupted between Korea and China in 2000. With the massive influx of Chinese garlic, domestic garlic prices took a nosedive so that the Korean Government imposed an emergency tariff on imports just to appease public opinion. In response, China took measures to suspend the import of Korean mobile phones and petroleum products. This garlic war only came to an end whenKorea made a unilateral concession.

For Korea that does not produce a single drop of oil nor have sufficient natural resources, trade constitutes the sole answer for our survival. The dependence of the economy on trade exceeds 70 percent. Given the 20 percent dependency of Japan, a trade powerhouse, the figure is particularly high. Having said that, the future of our nation will be bleak if we lose the trust of the global community.

Accordingly, the Government decided to engage in additional negotiations with the United States in a way that does not impact the economy adversely while protecting the public health. I hope our citizens will genuinely understand the situation facing the Government. 

Fellow citizens,

I learned a hard lesson in just two months in office, and I will never forget it throughout my term while administering government affairs. I will communicate with the people, and I will go along with the people. I will uphold the wishes of the people. I will also listen to opposing views.

I will reshuffle the Cheong Wa Dae secretariat as if I am starting all over again. The cabinet will be reorganized, too. I accept the public’s strong rebuke directed against the initial personnel lineup of my Administration. I will do my best to fully meet the standards required by the people in personnel matters.

During the presidential campaign, I made a pledge to construct the Pan-Korea Grand Waterway. However, if the people object to it, I will not push it. That is because any policy should be carried out with the blessings of the public if it is to be successful. That is the lesson I have learned clearly and painfully this time.

Fellow Koreans,

The global economic environment is very difficult now. Prices of raw materials and grains are skyrocketing. The international price of oil has doubled in the past year. There are apprehensions that they will continue to rise in the foreseeable future. And that will lead to a global economic crisis. Korea, too, will not be free of the expected crisis. We have to brace for it thoroughly and without delay.

The oil price hike has already prompted domestic strikes by transportation workers whose livelihood is threatened. Stoppages in distribution are occurring. Factory operations are being suspended. And we cannot blame the workers indiscriminately for taking action to protect their right to exist. But it should be noted that long strikes might lead to a fatal blow to the economy. If that happens, everyone, including the workers, will be badly hurt.

It seems to me that now is the time every entity—business, workers and the government—should take a step back and share the pain.

We already have experiences of overcoming many national crises. By joining forces, we successfully overcame the oil shocks in the 1970s and the financial crisis in the 1990s. When we share pain and work together hand in hand, we can tide over the current difficulty more quickly than any other nation.

When the economy turns bad, low-income families get hurt the most. The Government will place the highest priority on stabilizing prices and helping make everyday lives a little easier.

As I have promised, I will revitalize the economy without fail. The Government will create an environment conducive to investments by both domestic and foreign businesses, which will create a number of quality jobs.

Advancement of state-invested companies, reform of various regulations and improvement of the educational system are some of the essential things that have to be achieved for the nation to become a leading nation. The Government will thoroughly prepare for the tasks and carry them out without any discrepancy.

I am going to start all over again. I will humbly approach the people with trepidation.

I hope each of you, every citizen of this country, will trust my Administration and me as you keep a close watch on what we do and how we do it. I will make my best effort to turn the candlelight that lit the streets into a beacon of national aspiration. This is my promise.

Thank you very much.

Question and Answer Session withPresident Lee Myung-bak at the Special Press Conference 
 

June 19, 2008

QUESTION 1 : The Korean people seem to doubt whether the United States can be trusted when it comes to additional negotiations for banning the import of beef from cattle more than 30 months old. What measures will the Government take on this matter?

ANSWER : I clearly understand that the citizens are strongly demanding that beef from cattle aged over 30 months should not be imported.

In a bid to avoid any trade conflict, we have pursued a voluntary agreement among Korean importers and U.S. exporters that they would not import or export beef from cattle more than 30 months of age. The Korean Government, however, is requesting that the U.S. Government guarantee the voluntary decision of U.S. beef exporters not to export beef from older cattle because the voluntary restrictions are not enough to assuage our doubts.

Of course, negotiations for the guarantee will not be easy, but we are now asking the United States to understand and accept Korea’s unique situation and the demands of the public. During my telephone conversation with President Bush, I strongly expressed my determination that we would not import U.S. beef without a U.S. Government guarantee. The U.S. Government must accept at least this demand without fail. In response, President Bush said that he understood Korea’s situation and pledged to make efforts to that end.

As follow-up measures, the Korean Government delegation began negotiations with its U.S. counterpart. Five rounds of negotiations have been held thus far and the situation is difficult, but I am convinced that the United States will accept our demand for sure. Otherwise, we will postpone posting the U.S. beef import rules in the Government Gazette until our demand is accepted and imports will be impossible. In this regard, I promise that U.S. beef from cattle more than 30 months old will not be served on Korean tables under any circumstances. I hope the Korean people will trust the pledge of the President they elected.

QUESTION 2 : If it is confirmed that beef from cattle over 30 months of age is imported even after voluntary restrictions are in place, what actions would you take?

ANSWER : If the U.S. Government guarantees it, we should trust it. Conversely, if the Korean Government makes such a pledge, the United States and other nations should trust the Government of the Republic of Korea.

If any beef from cattle more than 30 months is imported, the product willnot be put under quarantine inspection and will be returned for sure before any such inspection. That’s why I think we can trust the promise the U.S. Government will make. In addition, U.S. beef is now exported to 96 countries.

Taiwan, Japan and China have begun similar negotiations with the United States. It is not right for the Korean President to mention the negotiation issues of other countries, but I expect the deal will be concluded according to similar international trade practices. If their results come out, we will have a chance to compare them with our own.

QUESTION 3 : Do you think it is desirable for Korea to engage in renegotiations with the United States because of popular pressure and protests? Also, I would like to ask whether you are concerned about the possibility that the changed stance of the Korean Government would lead to negative impacts on the country’s international image.

ANSWER : I believe every country has its own unique culture.

The Republic of Korea simultaneously achieved democratization and industrialization. Korea has gone through the April 19 Student Revolution of 1960, June 3 Student Movement of 1964, June 10 Democratic Struggle of 1987 and other democratic movements to become fully democratized. Through this kind of process, the country has developed such a unique democratic culture.

But, I want to make myself clear; the 21st century is definitely an era of representative democracy. That’s why I think it is normal procedure for the legislature to deal with every issue. But, I have to admit that the beef issue this time is an exceptional case.

Furthermore, the 21st century has turned into an era of digital technologies and the people are empowered to put forth their opinions directly through the Internet.

On the other hand, I think the right direction for the Republic to go is to uphold parliamentary democracy; important issues should be discussed and resolved in the National Assembly. It is important for non-Koreans to understand Korea’s unique culture, and I hope they would accept this matter in that sense.

As you may have witnessed, Korea has a unique street culture that was well demonstrated during the 2002 FIFA World Cup, which many people enjoyed together. This kind of thing is understandable but any kind of illegal and violent activities on city streets and plazas will have a very limited impact in the future.

QUESTION 4 : If the Korean Government is to obtain what it wants in the follow-up negotiations on U.S. beef imports, how do you think it would affect the KORUS FTA?

ANSWER : Beef imports and the KORUS FTA are somewhat different issues. The former is just about whether Korea would import U.S. beef or not. However, the latter is not just in the interest of Korea. I believe the KORUS FTA is mutually beneficial for both countries.

There can’tbe any modifications to the KORUS FTA as the two countries have already reached an agreement on it. U.S. President George W. Bush made this point very clear. He said that there couldn’t be any renegotiations regarding the KORUS FTA. And, he made a pledge that he would do his best to have the KORUS FTA ratified during his term in office, which is exactly the same as what we want to see.

QUESTION 5 : Regarding the recent strike by the Korea Cargo Transport Workers Union, what kind of fundamental measures will the Government take? And, the second part of my question is whether the truckers on strike should be recognized as unionized laborers or self-employed?

ANSWER : The Korea Cargo Transport Workers Union has struck periodically. Whenever they did, only stopgap measures were taken, including using military vehicles to haul freight. Even when a strike was over, nothing changed, and the same old problems have kept recurring. It is, therefore, understandable tosome extent why the truckers union went on strike this time. I accept their strike as a struggle for survival because the recent upsurge in the price of oil was unprecedented.

At the same time, I understand that the container companies are not in a position to accept the truckers union’s demand, which is an inordinate increase in freight hauling fees. Therefore, the Government has made several proposals to both container companies and truck drivers regardless of whether they are union members or not.

Actually, the Government has provided fuel subsidies to truck drivers. It also changed the registration system for freight trucks to a permit system. For these reasons, the number of trucks has drastically increased, thereby causing an oversupply. The excessive number of trucks has led to fierce competition, making the situation worse. To address these problems, the Government is planning to buy excess trucks and subsidize truckers who convert from diesel to liquefied naturalgas engines. The Government has made whatever proposals it could. The truck drivers, whether they are union members or not, now fully understand the effort made by the Government.

Thus, now is the time for local container companies and cargo owners to make some concessions. It seems that they are now in the final stage of negotiations. I think the strike this time has been triggered by the sharp hike in the price of all kinds of oils. Accordingly, this issue should be resolved based on concessions from local container companies and truck drivers with Government assistance.

Regarding the second question about whether striking truckers should be regarded as unionized laborers or self-employed, I think a legal interpretation should precede any personal views. From the legal perspective, they are truckers who possess their own vehicles. In some respects, they cannot be defined as unionized laborers. Legally speaking, they cannot join a labor union. So, I think that they use the term “solidarity” in their own way to refer to their organization.

One fundamental solution is to fix the country’s problematic distribution system. This issue is not only confined to freight. Compared to the price at a site of production, the consumer price of agricultural produce becomes much higher as it goes through a number of intermediate distributors each of who take a large profit. The same is true for local container companies and truckers. Truck drivers receive a maximum of about 70 percent or a minimum of 60 percent of the shipping charge from local container companies. About 30 or 40 percent of the shipping charge falls into the hands of intermediaries. So, a rudimentary reform of this distorted distribution system would benefit both local container companies and transportation workers. In this regard, I instructed ministries and agencies concerned to reexamine the country’s overall distribution system this time. The Government will work out fundamental measures against possible recurrence of similar problems in terms of agricultural products and freight by overhauling the distribution system.

QUESTION 6 : About a month has already passed since a reshuffling was first mentioned. What are the selection guidelines for the Prime Minister and the Chief of Staff?

ANSWER : Since the beginning of the new Administration, the selection of the personnel lineup for Cheong Wa Dae and the Cabinet has been subject to much criticism. Thus, I am now doing my best to fully meet the standards expected by the people in personnel matters. You said that a month has passed since I first talked about a reshuffle. But as you know, a senior presidential secretary has recently been in the United States together with some ministers, including the Minister for Food, Agriculture, Forestry and Fisheries, to take part in several rounds of additional negotiations on U.S. beef imports. These talks are still underway.

The senior secretary came back just yesterday. Judging that the role of Cheong Wa Dae in the negotiations has ended, I have announced that a reshuffle of the Cheong Wa Dae secretariat will be carried out. However, the National Assembly has yet to be normalized. Newly appointed ministers have to go through a hearing process in the National Assembly. The appointment of new ministers has hit a snag since nobody knows for sure when the National Assembly will be opened. In principle, we will complete the cabinet reorganization as early as possible. However, we cannot help but consider when the National Assembly will open to prevent any possible administrative vacuum.

Yesterday, from the perspective of starting all over again, we announced the plan to reshuffle seven senior secretaries and the Chief of Staff, rather than holding those individuals to account. We will soon make public the results of the selection process. I will engage in consultations with the newly appointed Chief of Staff to finalize the reshuffle.

Question 7 : My question is about the Government’s Internet policy. Your remarks on the Internet at the OECD Ministerial Meeting are raising some questions. What will the Government do for better communication with the public on the Internet?

ANSWER : The OECD Ministerial Meeting that convenes every decade is one of the most meaningful and significant international conferences. Held in Ottawa, Canada a decade ago, the gathering was convened this time in Seoul for the first time in Asia. I personally didn’t want to touch on a domestic issue in such an international gathering. As President of an Internet powerhouse, I just pointed out that the spread of viruses, hacking and cyber terrorism were causing serious side effects. As reported repeatedly by the media, there exist yet other serious problems such as the leakage of personal information and spam mail sent under the disguise of anonymity. I have explained those problems to OECD members.

The issues of Internet security and leakage of personal information are not confined to a single nation. Rather, all countries should join forces to address the problems. Only then, will the Internet culture be able to prosper. In addition, the Internet will serve as a driving force behind global economic growth. In this respect, trust is the most important factor in the Internet. In this cyber era, the lack of trust could turn out to be very dangerous. In order to establish trust, it is necessary for countries across the globe to cooperate with one another. As such, I talked about the issue of international cooperation. It had nothing to do with domestic issues.

Furthermore, I don’t have any old-fashioned ideas of unduly controlling the Internet under any circumstances. Now is an era of the Internet. The number of the people who communicate through the Internet has greatly increased. Accordingly, the Government is now deliberating over how to better communicate via the Internet in asomewhat active manner as it recognizes the necessity.

QUESTION 8 : Public opinion calls for expediting the privatization of state-invested corporations. What do you think about it?

ANSWER : I don’t think “privatization of state-invested corporations” is an appropriate term. I would rather call it the “modernization of state-invested corporations” instead.

Some state-invested corporations that carry out functions the Government should not be involved in will be privatized. But there are some other state-invested corporations that the Government needs to own, and it will help enhance their management skills. That’s why it does not necessarily mean that all state-invested corporations should be privatized uniformly. Therefore, it can be said to be the modernization of state-invested corporations.

As you know, the performance of some state-invested corporations is just as good as private businesses.But quite a number of them are being criticized by the public for their loose management and unduly high salaries while enjoying a monopoly in the market and depending on Government subsidies.

Privatization should not be a temporary process. To this end, the Government will have to seek the public’s opinion in every case. It is necessary to determine which corporation should remain as they are on the condition of gradual improvement in their management, which companies should be merged with others and which ones should be privatized. There is no difference of opinion between the Government and the ruling party.

When the National Assembly opens the regular session in September, it may have to change the laws to enable the modernization of state-invested companies. When the time comes, the Government and the ruling party will consult with each other about what has to be changed and what can be left as it is. The matter will be dealt with step by step.

Many people seem to worry about possible adverse effects of privatization like price hikes and loss of jobs. But that will not happen. If there is any possibility of price rises as a result of privatization of some companies, their privatization will not be considered in the first place.

I am apprehensive about groundless rumors. For example, there are rumors that the natural gas, water and electric companies will be privatized. This is entirely groundless. The Government has no plan whatsoever to privatize them. In this respect, the rumors seem to be intentional and malicious. I clearly say that they will not be affected at all.

There is another rumor that even the national health insurance may be privatized. I have to reiterate that there is no need for the public to worry about any of these things.

QUESTION 9 : In connection with your projected Cabinet reshuffle, do you have a plan to expand the scope of appointments to even include people with progressive ideas?

ANSWER : I think it is a good idea that the scope of the projected personnel reshuffle of the major Government posts should be extensive. I am thinking in that direction.

At the same time, I have a belief that personnel changes should be limited to the minimal in the interest of the stability of the Government. When a problem is spotted, we can change the direction of policy instead of changing the personnel too often. In the past Administrations, the average length of cabinet terms was too short. This practice is not conducive to proper administration of state affairs. I believe the important thing is to first select the best qualified people and give them opportunities to fulfill their responsibilities.

So I cannot tell you right now how extensive the cabinet reshuffle will be. I cannot give you specifics on this occasion. As I said, stability is important as well.

The economic situation is particularly difficult now. If we have tochange a cabinet member every time he or she has a problem, we will have a new minister every month. In July, the Government will announce plans for operating the national economy during the second half of the year. If changes are made in the direction of economic and other important policies, emphasis will be placed on taking better care of the needs of low-income families and controlling inflation.

In addition to oil, prices of virtually all commodities are increasing. The inflation rate in China is 8 percent, and the United States is recording more than 4 percent. The problem is universal, but the Government will try its best to help relieve the financial burden of average households.

QUESTION 10 : Are you willing to review comprehensively the economic policies of your administration and possibly revise them?

ANSWER : As I stated just now, inflation and economic hardships are not confined to Korea. Every country is suffering. If oil prices surpass US$150 per barrel, Korea will have to operate under an emergency plan.

When oil prices reach the US$150 to US$170 level, emergency plans will have to be carried out. If they further advance beyond US$170 and approach US$200, crisis measures will be prepared and implemented.

Currently, life has become stressful. In order to relieve the shock, priority will be given to price stabilization and other relief measures for ordinary citizens. In this way, we will find ways to manage the economy better even though it is weighed down by high fuel prices.

While we are in a difficult environment, we will have to enhance our industrial foundation. We may have to move toward energy-efficient industries. Heavy emphasis on service and financial industries will be a good idea. Securing overseas resources is critical, too.

In the resources sector, Japan is better prepared than we are. Since the first oil shocks, Japan has realized a 19 percent self-sufficiencyrate in meeting their needs for oil. So their exposure to the international fuel supply is about 80 percent.

By contrast, Korea has only secured a 4 to 5.2 percent self-sufficiency rate in the fuel supply. The country’s exposure to the international market is too high at 95-96 percent. It is my firm belief that companies as well as the Government have to strengthen their policies in this respect.

As I mentioned, the task of securing resources abroad, transforming the economic structure, developing the service industries and creating more jobs are something that we can try to achieve even in the adversity we are experiencing now. In the process, we will seek new ways to further develop the Korean economy in a proactive way.

There are other things we can do. For example, we can take advantage of the oil money pouring into the Middle East. We should be able to sell huge amount of plant construction there. The high oil price gives us trouble, but then we canturn right around and sell what we can to the oil producers. The Government and I are engaged in turning the crisis into an opportunity.

During the oil shocks of the 1970s, there was a time Korea experienced a whopping 27 percent inflation in a single year, and the economy suffered 1.5 percent negative growth. I do not think the current hardships will reach that level.

The Korean economy is still registering positive growth. The Government will explore new areas of potential growth that can overcome the current difficulties. It will formulate viable alternative measures and make them public soon.