PRESS BULLETIN - February 13, 2009

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SUBJECT: PRESS BULLETIN - February 13, 2009

Opinions/Editorials


1. Lessons of 'Buy-American' Policy
(Hankook Ilb, February 13, 2009, Page 39)

2. National Security Worries
(JoongAng Ilbo, February 13, 2009, Page 26)

3. North Korea Should Not Miscalculate Things with a Missile Launch

(Hankook Ilbo, February 13, 2009, Page 39)


Top Headlines

Chosun Ilbo
National Intelligence Service to Reshuffle Key Senior Officials

JoongAng Ilbo, All TVs
ROKG, Ruling Party Decide
to Offer Tax Waiver to Spur Home Sales

Dong-a Ilbo
Crisis to Foster SOC Projects, New Growth Engines

Hankook Ilbo
Education Ministry to Send Official in Charge of University
Admission to Korean Council for University Education,
an Indication that ROKG Might be Involved
in College Admission Policy Again

Hankyoreh Shinmun
Controversy Spreads over Blue House's Alleged Instructions to Police
to Promote Serial Killer Case in a Bid to Prevent Escalation of
Anti-Government Rallies
Sparked by "Yongsan Fire Tragedy"

Segye Ilbo
State-run Credit Insurers to Roll Over All their Guarantees
on Bank Loans that Mature This year,
Amounting to 34 Trillion Won

Seoul Shinmun
Worst Drought in 100 Years Hits ROK


Domestic Developments


1. Foreign Minister Yu Myung-hwan warned yesterday that North Korea
would not benefit from a missile launch, because of the resulting
international sanctions. (JoongAng)

2. According to a senior Defense Ministry official, 12 members of
the U.S. House Armed Services Committee will visit Seoul on Feb. 18
to discuss pending bilateral issues, including the transfer of
wartime operational control from the U.S. to the ROK and the
relocation of USFK bases. (JoongAng)


International News


1. It was learned yesterday that North Korea has transported a
Taepodong-2 missile to the Musudan-ri launch site on the east coast
using a special covered cargo carriage to make it difficult to
track. ROK and U.S. intelligence authorities assume that the North
is now assembling the missile at the launch site and could
test-launch it as early as Feb. 25, the first anniversary of
President Lee Myung-bak's inauguration. (Chosun)


2. According to diplomatic sources in Washington and the foreign
media, Stephen Bosworth, a former U.S. Ambassador to the ROK, is
certain to be named as Special Envoy for North Korea. (All)


Media Analysis

North Korea
Conservative Chosun Ilbo front-paged a report claiming that North
Korea has transported a Taepodong-2 missile to the Musudan-ri launch
site on the east coast using a special covered cargo carriage to
make it difficult to track. The report went on to say that ROK and
U.S. intelligence authorities assume that the North is now
assembling the missile at the launch site and could test-fire it as
early as Feb. 25, the first anniversary of President Lee Myung-bak's
inauguration. An ROKG official was quoted as saying: "The
Taepodong-2 has not been seen near the launch pad yet. We assume
that they are currently assembling the first and second-stage
rockets. Given the time needed to move the missile to the launch
pad, raise it, and fill it with liquid fuel once the first and
second-stage rockets are assembled, it is unlikely that it will be
ready for Feb. 16, leader Kim Jong-il's birthday."

Right-of-center JoongAng Ilbo carried a quote from Foreign Minister
Yu Myung-hwan, who warned yesterday that North Korea would not
benefit from a missile launch, because of the resulting
international sanctions.

JoongAng Ilb editorialized: "Amidst a series of signs that North
Korea may soon test a long-range missile, North Korea's propaganda
newspaper, Rodong Sinmun, has abruptly asserted North Korea's right
to use and develop space technology. Furthermore, the fact that
Chinese vessels have stopped fishing in the West Sea is definitely
an abnormal (would "unusual" fit better or not fit the original
sense?) move. Nevertheless, Seoul is exceptionally quiet, marking a
stark contrast to Washington, where warnings about North Korea's
provocations come out every day. Some even predict that the North
will probably seek to launch an attack calibrated to be too small
for Washington to intervene but strong enough to cause psychological
shock for the ROK. With the economy in such bad shape, we can't
afford concerns over national security. The ROKG must show
confidence and resolution on the matter." Moderate Hankook Ilbo
observed in an editorial: "Despite Washington's warnings and
concerns, North Korea appears to be pushing for the launch of a
ballistic missile. It is also unusual that Pyongyang replaced the
Minister of People's Armed Forces and the Chief of the General Staff
at the same time. We do not know what triggered these moves,
whether it was the internal circumstances in the North or something
else... Some observers say that these moves are designed to grab
Washington's attention, but the North's saber-rattling against the
Obama Administration, which is willing to have direct talks with it,
will not benefit U.S.-North Korea relations. It will only give
ammunition to hawks."

Citing diplomatic sources in Washington and the foreign media, the
ROK media gave wide play to a report saying that Stephen Bosworth, a
former U.S. Ambassador to the ROK, is certain to be named as Special
Envoy for North Korea.

Pakistan
Right-of-center JoongAng Ilbo replayed a Reuters report saying that
Pakistan admitted for the first time on Feb. 12 that last November's
Mumbai terrorist attacks were partially plotted on its soil.
Pakistan's Interior Minister Rehman Malik was quoted as saying: "We
have already expressed our intention to proactively cooperate with
India regarding the terror attacks." JoongAng viewed this
development as setting the stage for a thaw in relations between
Pakistan and India.


Opinions/Editorials

Lessons of 'Buy-American' Policy
(Hankook Ilb, February 13, 2009, Page 39)

By Sogang University Prof. An Se-young

These days, a new protectionist streak is surfacing in the world
economy. In late January, the U.S. House of Representatives passed
an economic stimulus package with a 'Buy-American' provision that
prohibits the purchase of foreign iron and steel for any
stimulus-funded infrastructure. The mandatory use of its own
products by a country under the World Trade Organization (WTO)
system apparently is a policy that might be seen in East Asian or
Latin American countries. But the U.S., which has been in the
vanguard of the world's free trade, made an unconvincing move.

In fact, the 'Buy-American' provision is a bygone relic that
vanished into history after the 1980s when Asian-made products such
as textiles and electronic goods were imported en masse to the U.S.
However, with economic meltdown in the U.S., the U.S. Congress
revived the protectionist clause to pacify the laborers in its
legislative districts.

In the U.S., there is a saying, 'protectionism by Congress versus
free trade by President'. In times of economic downturn, lawmakers
tend to represent interests of their legislative districts which
generally call for protectionism. But the U.S president takes a
different attitude. He is mindful of America's leadership in the
international community and views the public economy from an overall
perspective. Therefore, the U.S president is somewhat keen on
preserving free trade while occasionally balking at protectionist
moves by Congress.

The 'Buy-American' policy by the U.S. could lead to similar moves in
countries such as the European Union (EU),Japan and Korea which are
also eager to protect their own faltering industries. France and
China each are moving to enforce mandatory purchase of their own
products.

With spread of this vicious cycle, protectionism would spread beyond
the steel industry into the manufacturing field and service sector..
This would plunge the world economy into a great depression. A
study by the Peterson Institute for International Economics has
found that the 'Buy-American' provision could create merely 1,000
jobs in the steel industry. On the contrary, if this protectionist
move for steel spreads to U.S. trading partners such as EU and China
and they import less U.S.-made steel products than before, it would
cost the U.S. steel industry as many as 6, 500 jobs.

We should draw clear lessons from the 'Buy-American' policy. We
should not budge an inch from the World Trade Organization (WTO)
system that has taken hold for the past half century with
cooperation from around the world. President Lee Myung-bak stressed
this point at the Group of 20 (G-20) financial summit and President
Obama also underscored in early February that the 'Buy-American'
provision should be in accordance with international agreements. We
expect the G-20 leaders, who will gather in London in April, to
display leadership by spurning protectionism and making a concerted
effort to re-affirm the world's free trade spirit.


National Security Worries
(JoongAng Ilbo, February 13, 2009, Page 26)

A series of signs indicate that North Korea may soon test a
long-range missile. The intelligence authorities have evidence that
missile launching equipment was positioned, after an object
suspected to be a Taepodong-2 was moved to a missile base in
Musudan-ri, Hwadae County, in North Hamgyeong Province.

CNN reported that a U.S. intelligence satellite caught North Koreans
assembling telemetry equipment used for a missile launch.

North Korea's propaganda newspaper, Rodong Sinmun, abruptly talked
about North Korea's right to use and develop space technology.
Chinese fishing vessels stopped sailing into Yellow Sea waters,
definitely an abnormal move. Worries that North Korea will soon
conduct a missile test are increasing.

However, Seoul is exceptionally quiet, marking a stark contrast to
Washington, where warnings about North Korea's provocations come out
every day. Seoul is taking a hands-off approach, just as it kept
silent when North Korea announced that it would nullify all
agreements between Seoul and Pyongyang that aimed to ease political
and military confrontation, and that aimed to abolish causes of
tension related to the Northern Limit Line, a sea border between the
South and the North.

South Korea is determined to abide by principles, remain persistent
and resolute and not to change its attitude and stance according to
North Korea's every move.

However, the people are nervous. Are there government measures to
cope with a national security crisis if Pyongyang launches a
Taepodong-2 missile and Washington shoots it down? How will our
government respond if North Korea fires a missile over the NLL into
our territory, which Pyongyang claims as its waters?

Will South Korea be lost, not knowing what to do, or will it
counterattack? If Seoul counterattacks, would this lead to an
all-out war? Some even predict that North Korea will probably seek
an attack which would be too small for Washington to intervene but
strong enough to cause psychological shock for South Korea.

Our unification minister and the head of the National Intelligence
Service have been replaced and the line-up of the new foreign
affairs and national security team hasn't been decided yet,
intensifying concerns even more.

With the economy in such bad shape, we can't afford concerns over
national security. The government must show confidence and
resolution on the matter.

* This is a translation provided by the newspaper, and it is
identical to the Korean version.


North Korea Should Not Miscalculate Things with a Missile Launch
(Hankook Ilbo, February 13, 2009, Page 39)

A string of reports about North Korea are unsettling. For quite a
while, Pyongyang has pressured Seoul through statements from the
Chief of the General Staff of the Korean People's Army and the
Committee for the Peaceful Unification of the Fatherland, and this
time, it is now preparing a launch of a ballistic missile. After
recently moving what looks like a Taepodong-2 missile to a launch
site at Musudan-ri in Hwadae County, North Hamkyung Province, the
North is now taking additional steps to test-fire the missile, such
as assembling equipment for remote measurement. Despite
Washington's concern and its series of warnings, the North appears
to be pushing for the launch of a ballistic missile. It is also
uncommon that Pyongyang replaced the Minister of People's Armed
Forces and the Chief of the General Staff at the same time.

We do not know what judgment the North made about the situation
before making this move and how the internal circumstances in the
North affected the move. However, it is evident that in the current
international situation, there is no benefit that the North can gain
by raising tension through a missile launch. Some observers say
that it is designed to grab Washington's attention, but
saber-rattling against the Obama Administration, which is willing to
have direct talks with the North, is not beneficial to progress in
the U.S.-North Korea relations. It will only give ammunition to
hawks.
A missile launch may also be for internal purposes, of course. The
North might need an event like a missile firing to solidify internal
unity, which was weakened by the alleged poor health of North Korean
leader Kim Jong-il, and to pave the way for a post-Kim era. The
replacements of the Minister of People's Armed Forces and the Chief
of the General Staff may have come in this context.

If Pyongyang fires a Taepodong-2 missile for these purposes, it will
likely say to the outside world that it is launching an artificial
satellite, as it did in 1998. Then, the North calculates, it could
dodge criticism for violating the UN resolution. However,
considering that it is very difficult to distinguish a satellite
projectile from a ballistic missile, the North's claim will be a
transparent guile, and therefore, it will not be able to avoid
international condemnation and sanctions. It is also unusual that
Washington is issuing a series of strong warnings against
Pyongyang's missile test preparations. The North should judge with
a cool head what result its reckless behavior will produce.


Stephens
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