[Editorial] Weather on Korean Peninsula: Stormy to Foreigners, But Calm to Koreans

Shocked to hear that Moody`s Investors Service, Inc. lowered the sovereign credit of South Korea by two levels. Its credit research team visited Korea last month. At that time, the team announced that it would not modify South Korea`s credit rating. It was only 20 days ago. But the reality is direct opposite, shocking us as much more.

Moody`s announced that North Korea`s nuclear standoff, if getting worse, could affect the ratings negatively, rather than positively. From the announcement, we can read that the main force that pulled down the rating lies in the North Korean nuclear issue. Moody`s believes that North Korea has become more aggressive than any other time in the past, as demonstrated by its recent moves such as kicking-out of IAEA inspectors, withdrawal from the Nonproliferation Treaty and reactivation of its nuclear facilities in Yongbyun. We can infer how much fear and anxiety foreigners feel about the national security of South Korea.

Even under these dire circumstances, any feeling of crisis can hardly be read on the faces of most South Koreas. Moody`s originally promised that it would not modify the rating by the end of April. Suddenly, however, it changed it. Nonetheless, Kim Dae Jung administration does not seem to take this seriously. On what grounds, could the Kim administration bluff that the future would be rosy, when the research team returned after hearing about the nuclear standoff and the candle-lit rallies? We could not just find any words.

Our economy will be damaged most severely from the modification of the rating outlook. A sign of chaos is brewing up in the financial market. The exchange rate of won against dollar has shot up, and various stock indexes plummeted. South Korea cannot handle anything alone including the nuclear standoff involving North Korea, and the upcoming US-led war on Iraq. If that continues, experts predict to our dismay, the fledging chaos could last long.

The most important task lying before the incoming Roh Moo-hyun administration is to minimize the shocking effects and reinstate the damaged credit rating. Roh has alleged that journalists are sparking an economic crisis by pasting papers with dark news. Now, it`s high time for him to concede to the reality and see straight into it. That way, it could achieve most in eliminating the uncertainties clouding the future of our economy. Remember there are different kinds of uncertainties out there.