PRESS BULLETIN - February 17, 2009

UNCLAS SEOUL 000240 SIPDIS DEPT FOR EAP/K, EAP/PD, INR/EAP/K AND INR/IL/P TREASURY FOR OASIA/WINGLE USDOC FOR 4430/IEP/OPB/EAP/WGOLICKE STATE PASS USDA ELECTRONICALLY FOR FAS/ITP STATE PASS DOL/ILAB SUDHA HALEY STATE PASS USTR FOR IVES/WEISEL E.O. 12958: N/A TAGS: KPAO PGOV PREL MARR ECON KS US SUBJECT: PRESS BULLETIN - February 17, 2009 Opinions/Editorials ¶1. Welcoming Clinton (JoongAng Ilbo, February 16, 2009, Page 31) ¶2. "Hillary! Hillary!..." (Chosun Ilbo, February 17, 2009, Page 30) ¶3. Leader Parties While His People Starve (Dong-a Ilbo, February 17, 2009, Page 31) ¶4. Even Two Years after Feb. 13 Agreement, Pyongyang Still Engages in Tricks (Dong-a Ilbo, February 14, 2009, Page 27) ¶5. It All Boils Down to Giving Up Nukes (Dong-a Ilbo, February 16, 2009, Page 27) ¶6. Clinton Puts N.Korea on the Spot (Chosun Ilbo, February 16, 2009, Page 31) ¶7. Put the Comprehensive Approach on a Stable Track (Hankyoreh Shinmun, February 17, 2009, Page 23) ¶8. ROKG Should Start Giving Aid to the Automotive Industry (Hankook Ilbo, February 17, 2009, Page 39) Top Headlines All Cardinal Stephen Kim Sou-hwan, Spiritual Leader, Dies at 86 Domestic Developments ¶1. Defense Minister Lee Sang-hee told the National Assembly yesterday that North Korea may attack an ROK naval ship or launch ship-to-ship missiles in the West Sea but that there is no indication that it is preparing for an all-out war. He went on to say that he has largely delegated authority to operational commanders in the field to make decisions and to take action speedily in case of a North Korean provocation. He was further quoted as saying: "It is time to consider joining the U.S.-led Proliferation Security Initiative (PSI) aimed at stopping the spread of weapons of mass destruction. (All) ¶2. President Lee Myung-bak formally appointed former Prime Minister Han Duck-soo as Ambassador to the U.S. yesterday, in a major diplomatic shakeup affecting 18 ambassadors and six consul generals. (Chosun, Hankyoreh, Segye, Seoul) ¶3. Anti-North Korea civic groups in the ROK flew giant balloons carrying anti-Pyongyang leaflets across the border yesterday, on the occasion of North Korean leader Kim Jong-il's birthday on Feb. 16. (All) International News ¶1. Secretary of State Hillary Clinton arrived in Tokyo yesterday as part of her first trip abroad as America's top diplomat. She was quoted as stressing in Tokyo: "North Korea has already agreed to dismantle its nuclear programs. We expect the North to fulfill its obligations." (Chosun, Dong-a, Hankook, Hankyoreh, Segye, Seoul, all TVs, Pressian) ¶2. North Korea denied yesterday that it was preparing to test-fire a long-range missile, saying instead that it was a satellite launch as part of "peaceful aerospace research activities." The (North) Korean Central News Agency criticized the U.S. and some other countries for "scheming to viciously link such scientific studies with a missile," while stressing that "space development is the North's independent right." The North's statement is similar to one Pyongyang issued in 1998 after it launched a Taepodong-1 missile from a base in Musudan-ri, North Hamgyong Province. (All) ¶3. The North's official daily Rodong Shinmun, meanwhile, celebrated leader Kim Jong-il's birthday in an editorial, mentioning "lineage succession." The emphasis on lineage succession can be interpreted as an attempt to create conditions for a "third-generation hereditary succession of power" to one of Kim Jong-il's three sons. (Dong-a) Media Analysis Secretary Clinton's Visit to Asia Most of the ROK media today covered Secretary of State Hillary Clinton's arrival in Tokyo yesterday as part of her first trip abroad as America's top diplomat. She was widely quoted as stressing in Tokyo: "North Korea has already agreed to dismantle its nuclear programs. We expect the North to fulfill its obligations." Conservative Chosun Ilbo's Washington Correspondent Lee Ha-won observed today: "Since Barack Obama was elected as U.S. President last November, the ROKG has, fortunately, received good evaluations from and begun friendly relations with new U.S. administration officials. In order to continue this mood, we should demonstrate our commitment to international issues during Secretary Clinton's upcoming visit to Seoul, rather than just pressing to resolve our own issues. Doing so would be of great help to our relationship with the U.S. We should use this opportunity to demonstrate that the ROK has the capability to discuss international issues at all times." Most of the ROK media yesterday noted Secretary of State Clinton's remarks during a Feb. 13 speech to the Asia Society in New York. They particularly focused on her statement that the U.S. would be willing to normalize bilateral relations, replace the Korean Peninsula's long-standing armistice agreement with a permanent peace treaty and to extend economic aid for North Korean people if North Korea is genuinely prepared to completely and verifiably eliminate its nuclear programs. Conservative Chosun Ilbo editorialized: "It was her first comprehensive statement on North Korea policy and comes ahead of her visit to the ROK this Thursday. Now that the Obama Administration has clearly stated its policy, the North must waste no more time trying to test the USG. It is now up to North Korean leader Kim Jong-il whether his country will be able to revive its battered economy and offer food and medicine to its citizens by doing what it has long agreed to do. Secretary Clinton also warned North Korea against test-firing a Taepodong-2 missile or engaging in any provocations along the Northern Limit Line, the de-facto sea border between the two Koreas, by saying that such behavior could make the road ahead difficult for both countries. Now, North Korea must give an answer." Right-of-center JoongAng Ilbo's editorial stated: "The North's tactics of preparing to launch a missile and renewing threats of military action against the ROK are mainly aimed at drawing Washington's attention to the Korean Peninsula. Clinton's comments are expected to help resolve the North's existing concerns. Accordingly North Korea holds the key to the solution of the problem." Left-leaning Hankyoreh Shinmun editorialized: "Secretary Clinton has made it clear that North Korea's nuclear disarmament, normalization of U.S.-North Korea ties, signing of a peace treaty and economic assistance to the North should be pursued simultaneously. It means that if the North's intention to denuclearize is confirmed, the U.S. would put all the things it has promised to offer on a negotiating table. This would be a departure from the former Bush Administration's 'denuclearization first policy' and a return to the basic spirit of the Joint Statement of September 19, 2005. It is time to create conditions for realizing comprehensive negotiations." North Korea - Missile Maneuvers All the ROK media today gave prominent attention to North Korea's claim yesterday that it was preparing to launch a satellite, not a missile. The (North) Korean Central News Agency (KCNA) was widely quoted as criticizing the U.S. and some other countries for "scheming to viciously link such scientific studies with a missile," while stressing that "space development is the North's independent right." The KCNA was further quoted as asserting: "One will come to know later what will be launched in the North, a statement seen by most of the ROK media as indicating that the launch may be imminent. The ROKG was quoted as responding: "Whether the North Korean launch is for space development or a test of a missile, it will be in breach of UN Security Council resolutions. The ROK media noted that the KCNA statement is similar to one Pyongyang issued in 1998 after it launched a Taepodong-1 missile from a base in Musudan-ri, North Hamgyong Province, and commented that North Korea might push ahead with testing a missile under the pretext of launching a satellite into orbit. Defense Minister Lee Sang-hee was widely quoted as telling the National Assembly yesterday that North Korea may attack an ROK naval ship or launch ship-to-ship missiles in the West Sea but that there is no indication that it is preparing for an all-out war. He was further quoted as saying: "I have largely delegated authority to operational commanders in the field to make decisions and to take action speedily in case of a North Korean provocation... It is time to consider joining the U.S.-led Proliferation Security Initiative (PSI) aimed at stopping the spread of weapons of mass destruction." Opinions/Editorials Welcoming Clinton (JoongAng Ilbo, February 16, 2009, Page 31) By Lee Hong-koo, a former prime minister and adviser to JoongAng Ilbo We expect Secretary Clinton's interest in Asia to take American policy in this region to a higher level. I extend a heartfelt welcome to U.S. Secretary of State Hillary Clinton as she visits Asia on her first trip in her new office. The world is experiencing unprecedented economic turmoil, and is going through a period of historic transition. The curtain has been drawn on the Cold War era, and America's supremacy now fails to maintain the global order. The American eagle can no longer fly with one wing - the Atlantic community of the European Union and the National Atlantic Treaty Organization. With the axis of history moving from west to east, the Asia-Pacific era is unfolding. The U.S has a strategic continental position between the Atlantic and the Pacific. The country should extend its geographic strength to all realms of society, from politics and economics to culture. America is now encountering a great opportunity to take flight on two wings - one consisting of the Atlantic community and the other of Pacific nations - by actively participating, as a Pacific nation, in a global effort to build a new Asian community. Against this backdrop, I wish to express my sincere respect for Clinton's astute judgment in choosing East Asia for her first trip abroad as Secretary of State. The enthusiasm expressed by Koreans for the inauguration of President Barack Obama and Secretary of State Clinton is not due to their partisan support for any one side in American politics. What is more important to us is that as Korea's closest ally, the U.S. will continue to maintain its undisputed power and sense of confidence. Koreans have concerns about America's shrinking global prestige since the 9/11 terrorism attacks. They expect the start of the Obama Administration will herald a new beginning for America. Meanwhile, Clinton impressed us as a politician of great character in America's dramatic democratic political campaign - from the Democratic Party primary to the tight presidential race and finally to the inauguration of the new government. Korea is still undergoing turbulent changes despite all the hardship we went through in establishing a democratic government. And we expect Secretary Clinton's keen interest in Asia to take American policy in this region to a higher plane. The 64 years of division on the Korean Peninsula is a serious problem that we can no longer leave unsettled. Unlike South Korea's open-door policy, North Korea has persistently pursued a hostile policy toward the outside world. The reclusive country faces a serious humanitarian crisis, as it has ignored the human rights of its people. However, it has managed to yield tangible results in its efforts to become a nuclear power, bringing Northeast Asia, as well as the Korean Peninsula, to a crisis of strategic imbalance. Because of this, Korea and Japan will likely be the only non-nuclear nations among the participants in the Six-Party Talks. The possibilities that can stem from this dangerous situation are undesirable to member states, including China. As such, the Obama Administration should shoulder the responsibility for preventing the situation from remaining in such an unbalanced state by seeking a peaceful resolution. Thus, Secretary of State Clinton should also share the burden of promptly meeting the needs of the times. To cope with such demands, it is urgent that we foster a heightened awareness of cooperation and mutual assistance, especially between Korea and the U.S. The hostile situation on the Korean Peninsula can not be dealt with exclusively through confronting North Korea's nuclear weapons program. It needs to be resolved in a broader context, focusing on how North Korea can be peacefully assimilated into East Asia and the rest of the world order. To this end, I believe that Clinton's visit will stimulate a concerted effort by Korea and the U.S. to share wisdom, trust and patience in the future. Our great expectations for Secretary Clinton's visit to Korea are tempered by one or two concerns. The first is whether Korea and America will be able to push forward with the difficult task of renewing our shared awareness, strategies and plans in a swift manner, and whether we will be able to conduct ample talks, reach agreements, and engender sufficient mutual trust. The second concern is whether the U.S. will be able to assign priority to Asia, especially the Korean Peninsula, amid myriad global crises that require a coordinated and comprehensive response from the U.S. We recall that Asia was all but placed on the back burner for the past several years, due to the urgency of the Middle East crisis taking priority. We expect America to elevate the North Korea problem to the top of its list of priorities, while exploring new ways to foster substantial partnership with China. We hope that our fears will prove to be unfounded. * This is a translation provided by the newspaper, and it is identical to the Korean version. "Hillary! Hillary!..." (Chosun Ilbo, February 17, 2009, Page 30) U.S. Secretary of State Clinton will visit Seoul on February 19 on her first overseas trip since assuming office. Secretary Clinton, who was close to becoming the 44th President of the United States only a year ago, still has big ambitions. During this trip to Asia, she wants to discuss not local issues but the "global issues" that draw global attention. The agenda, which the U.S. Department of State repeatedly said Secretary Clinton would discuss during her visit to Asia, includes common issues such as the "global financial crisis, human rights, and climate change." It is also noteworthy that throughout her trip, she is being accompanied by Special Envoy for Climate Change Todd Stern. If ROK Foreign Minister Yu Myung-hwan understands this background, he needs to prepare for the ROK-U.S. Foreign Ministers' meeting at the global level. When Secretary Clinton wants to discuss not only Korean Peninsula issues but also international matters, such as the economic crisis, climate change, arms reduction, and energy, we should also be prepared for it. What needs to be also taken into consideration is that the Obama Administration has been in office for only a month. Researcher John Bark at the United States Institute for Peace likened the current U.S. to a general hospital bustling with emergency patients from all over the places. The U.S. is at a loss over a plethora of issues such as economic crisis, and issues regarding Iraq, Afghanistan and Middle East. He analyzed that in this situation, if the ROKG brings up issues such as the Korea-U.S. Free Trade Agreement (FTA) and Dokdo, the U.S. would react indifferently. The ROKG should momentarily shelve its list of wishes for the Obama Administration and extend a helping gesture to the U.S. He said this would positively impress the U.S. government and ultimately lead to good results for the ROKG. Since Barack Obama was elected as U.S. President last November, the ROKG has, fortunately, received good evaluations from and begun friendly relations with new U.S. administration officials. In order to continue this mood, we should demonstrate our commitment to international issues during Secretary Clinton's upcoming visit to Seoul, rather than push to resolve just our own issues. Doing so would be of great significance to our relationship with the U.S. We should use this opportunity to demonstrate that the ROK has the capability to discuss international issues at all times. Leader Parties While His People Starve (Dong-a Ilbo, February 17, 2009, Page 31) North Korean leader Kim Jong-il celebrated his 67th birthday yesterday. Fireworks were set off in skies above Mount Baekdu, and celebrations were held all over the poor country. Money was wasted to mark the birthday of a dictator who is to blame for suppression and poverty. Unfortunately, relieving the pain and suffering of North Koreans seems to be impossible as long as the Kim dynasty continues to rule the North. The communist regime is increasing tension by its business-as-usual confrontational tactics - blaming others for the crisis instead of improving the misfortune if its 24 million people. If nothing is done, the international community could lose interest in giving humanitarian aid to the country. Kim Yong-nam, the head of the North Korean parliament, has accused South Korea of being "a warlike power opposed to reunification, bringing the disaster of nuclear war." The North is trying to pass the buck, however, despite violating the denuclearization agreement in arming itself with nuclear weapons first. Pyongyang is again trying to use its long-range missiles and provocations in the Yellow Sea as a bargaining chip. So who is blaming who? North Korea might want to see a repetition of the past when its claim for unity used to lead to internal division among South Koreans, but inter-Korean relations have changed. The previous two liberal administrations in Seoul tried to paralyze the South Korean people's judgment of the North by pushing for two inter-Korean summits, and in doing so, spread the pro-North Korea movement. The Kim Dae-jung Administration invited North Korean female cheerleaders to the Universiade in Daegu in Aug. 2003, following the Busan Asiad in Sept. 2002, even before the memory of the deadly naval clash in the Yellow Sea faded away. Certain thoughtless South Koreans chanted, "We're one" upon being fascinated by the beauty of the North Korean cheerleaders. They intentionally did not focus on the cheerleaders, who cried because a picture of their leader Kim Jong-il got wet. Even a pregnant pro-North activist, who visited the North's propagandistic Arirang show, gave birth in Pyongyang. She felt like she was the frontier of unification. But these are bygones. Paradoxically, Kim's birthday party can help correct the South Korean view of North Korea. The North is an extremely poor land where many children beg for food and residents suffer from malnutrition. But the communist regime still calls for "bare fists" and "labor" at construction sites. Who can deny that Kim is responsible for making North Korea what it is today. * This is a translation provided by the newspaper, and it is identical to the Korean version. Even Two Years after Feb. 13 Agreement, Pyongyang Still Engages in Tricks (Dong-a Ilbo, February 14, 2009, Page 27) Two years ago today, the chief negotiators of the Six-Party Talks issued the "February 13 Agreement" that specifies steps for North Korea to denuclearize. Eight months later, North Korea also agreed to the October 3 Agreement that outlines more specific actions, including the disablement of nuclear facilities. If Pyongyang had been sincere about its promises, and it had had any will to implement the agreements, the communist state would have already completed the disablement of its nuclear facilities and entered the nuclear dismantlement process by now. However, the North Korean nuclear clock is now going backward. The North fancies itself as a nuclear state and is even calling for nuclear arms reduction talks with the U.S. This is reckless behavior, and ridicules the other Six-Party nations. If we compare the current situation with that of two years ago, we can clearly figure out North Korea's intention. Pyongyang has opted for a "provocative mode" by putting on the brakes right ahead of nuclear disablement. The North is telling us not to expect it to dismantle its nuclear programs, but instead is asking us to provide "carrots" if we want to prevent the North from using its new bargaining chips-a long-range missile launch and an armed provocation in the West Sea. Pyongyang is also rattling its saber against Seoul by exposing rocket artillery near the Military Demarcation Line and coastal artillery in Haeju and the Ongjin Peninsula off the west coast. If the new USG offers carrots and the ROKG steps backward, the North will, once again, pretend to sit down at the bargaining table. However, if the North judges that it has the initiative, it is a serious miscalculation. Now, neither Seoul nor Washington trusts Pyongyang. It is the lesson that they have learned over the past two years since the February 13 Agreement. Both the ROK and the U.S. should make it clear that North Korea cannot avoid the nuclear problem, the biggest pending issue between the two Koreas as well as between the North and the U.S. U.S. Secretary of State Hillary Clinton's visit to Seoul next week is a good opportunity to show the strength of cooperation between the ROK and the U.S. It All Boils Down to Giving Up Nukes (Dong-a Ilbo, February 16, 2009, Page 27) U.S. Secretary of State Hillary Clinton said during a February 13 speech to the Asia Society in New York, "If North Korea is genuinely prepared to completely and verifiably eliminate their nuclear weapons program, the Obama Administration will be willing to normalize bilateral relations." She also warned, "It is incumbent upon North Korea to avoid any provocative action and unhelpful rhetoric toward South Korea," and she touched on North Korea's human rights and its past abduction of Japanese. In principle, we welcome the Barack Obama Administration's North Korea policy, which was affirmed by Secretary Clinton. We hope that the new USG's policy of using carrots and sticks simultaneously will lead to North Korea's nuclear dismantlement, based on close cooperation between the ROK and the U.S. However, we hope that Washington takes a clear position on some points. One of them refers to Secretary Clinton's statements, "If North Korea is genuinely prepared to completely and verifiably eliminate their nuclear weapons program..." The phrase "is prepared to eliminate" is starkly different from the words "to dismantle," which was used by the Bush Administration. This is because Secretary Clinton's comment indicates that even if the North does not actually get rid of its nuclear programs but it is only "prepared" to do so, the U.S. will take some steps to improve its relations with the North. This is considered a more conciliatory approach to North Korea than during the Bush Administration. Of course, it is sometimes inevitable to employ conciliatory measures in order to resolve the North Korean nuclear issue peacefully. However, we have learned from experience that this attitude could cause the North to make a miscalculation and, consequently, add to the difficulty of the North dismantling its nuclear programs. This is evidenced by the fact that although the U.S. Republican Administration made a series of concessions over the past decade, even a nuclear verification was not adopted. When Secretary Clinton visits Seoul on February 19, we expect her to give a clear explanation about this. Otherwise, the North would have the delusion that even without abandoning its nuclear ambitions, it can accelerate the normalization of the U.S.-North Korea relations by threatening Seoul and using tactics to exclude it from the U.S.-North Korea talks. Clinton Puts N.Korea on the Spot (Chosun Ilbo, February 16, 2009, Page 31) U.S. Secretary of State Hillary Clinton in a speech at the Asia Society in New York last weekend said, "If North Korea is genuinely prepared to completely and verifiably eliminate its nuclear program, the Obama Administration will be ready to normalize our bilateral relations." She said the former Bush Administration had not properly handled suspicions over North Korea's uranium enrichment program. It was her first comprehensive statement on North Korea policy and comes ahead of her visit to South Korea this Thursday. Clinton was responding to North Korea's recent grandstanding. The Six-Party nuclear talks have been shelved for more than four months due to differences over how to verify North Korea's nuclear inventory. But taking advantage of ambiguity in a verbal agreement between the U.S. and North Korea that the verification will be based on "scientific procedures," the North has refused to allow international inspectors to take samples from nuclear facilities, claiming that it is not part of scientific verification. North Korea is afraid of revealing details of the process by which it developed nuclear weapons. But verifying its inventory is impossible without taking samples from within its nuclear facilities. Yet in its desire to hold direct talks with Washington, Pyongyang has at the same time been busy trying to size up the Obama Administration for talks on mutual reduction of nuclear weapons. Clinton's comments hark back to the Sept. 19 Joint Declaration of 2005, which contains the principle of rewards in exchange for North Korea scrapping its nuclear program. She said the Obama Administration is ready to provide support if North Korea is in line with the "action for action" principle of the declaration, which stipulates that both processes must take place almost simultaneously. By including North Korea's alleged uranium program, which the Bush Administration removed from items addressed during the Six-Party Talks, Clinton goes further. For Pyongyang, the disappointment must be huge. Now that the Obama Administration has clearly stated its policy, the North must waste no more time trying to test the U.S. government. It is now up to North Korean leader Kim Jong-il whether his country will be able to revive its battered economy and offer food and medicine to its citizens by doing what it has long agreed to do. Clinton warned North Korea against test firing a Taepodong 2 missile or engaging in any provocations along on the Northern Limit Line, the de-facto sea border between the two Koreas, by saying such behavior could make the road ahead difficult for both countries. Now North Korea must give an answer. * This is a translation provided by the newspaper, and it is identical to the Korean version. Put the Comprehensive Approach on a Stable Track (Hankyoreh Shinmun, February 17, 2009, Page 23) United States Secretary of State Hillary Clinton, before leaving for Korea, China, Japan, and Indonesia on her first foreign trip as Secretary of State, said she is going because "so much of our future depends upon our relationships there." This can be interpreted to mean the United States is going to seek a new approach to finding opportunities for common prosperity. The speech she gave at the Asia Society on Friday, in which she spoke about what the principles behind a package deal with North Korea would be, can be seen as being in the same context. Her visit must be made at a time when these principles get put into specifics. Clinton made it clear that North Korea's abandonment of its nuclear programs, the normalization of ties between Pyongyang and Washington, the signing of a peace treaty, and aid for North Korea, such as energy aid, must take place at the same time. This means that once it is confirmed that the North is willing to abandon its nuclear agenda, then all these things would be given in exchange and be put on the table. In that this deal calls for denuclearization and normalization of ties to progress at the same time, it differs from the Bush Administration's approach of insisting the North give up its nuclear capabilities before anything else. It is also a return to the basic spirit of the September 19 Joint Statement. Now, we need to have the creation of conditions that make a package deal possible. The biggest obstacle is the lack of trust. The restraints on progress are apparent in Clinton speech which put the situation in hypothetical terms, when she said "if" the North is interested in abolishing its nuclear capabilities. However, when you make one-sided demands on the other side without changing your attitude first, trust cannot be built (between the two sides). The United States and South Korea need to have wide-ranging discussions at their upcoming foreign ministers' meeting on how to make use of "comprehensive approach" in a stable way. One way to do that would be to hold high-level contact between the United States and North Korea, the least of which should include the dispatch of a special emissary to Pyongyang. The upcoming talks need to produce a concrete plan for resolving the discord over nuclear verification as well. The South Korean government needs to take a clear stance in two areas. First, it needs to willingly accept the movement between the United States and North Korea towards progress in relations and support it. The level of relations between the United States and North Korea and the direction Six-Party process takes will be significantly influenced by what Seoul decides to do. It is entirely unrealistic for the Lee Myung-bak Administration to maintain that "nothing has changed in the U.S. position." Also, there needs to be a wholesale reexamination of Seoul's policies towards Pyongyang. Inter-Korean relations will become a burden for the Six-Party Talks if the current state of confrontation continues. North Korea needs to make sure it does not lose this rare opportunity. If the comprehensive approach does not get settled, and if, therefore, the Six-Party Talks fail to make progress, many countries are going to assume hard-line positions again. What the North needs to be doing right now is demonstrating clear intent when it comes to the road ahead, and it needs to do so at a high level of contact. Naturally, it also needs to exercise restraint and not do anything provocative like firing a missile. * This is a translation provided by the newspaper, and it is identical to the Korean version. ROKG Should Start Giving Aid to the Automotive Industry (Hankook Ilbo, February 17, 2009, Page 39) U.S. automotive maker, General Motors Corporation (GM),which has been under the U.S. government's bailout program, is to propose its restructuring plan that calls for injection of additional public fund and includes filing for bankruptcy protection. This apparently is designed to put pressure on the Obama Administration to offer additional aid and elicit concessions from the creditors and labor union. GM has already received 9.4 billion dollars in assistance but is unlikely to survive without a third bailout package worth 4 billion dollars. GM, which accounted for 60% in the U.S automotive industry, is facing bankruptcy due to its inability to develop cars in line with environmental changes and the union workers' extreme self-centeredness. GM focused on production of larger-scale vehicles rather than high-fuel efficiency vehicles, thus almost dooming it to go bust. Moreover, the company was compelled to offer excessive welfare benefits including health and pension insurance to its retired employees at the request of the hard-line labor union. Let's take a look at Hyundai Kia Motors. Thirty years after its production of Pony, the first brand, Hyundai emerged as the world's fifth automaker. But it is suffering from difficulties such as decrease in productivity, reduction in competitiveness and hard-line labor union. The company is seeing the sharp decline of its exports and capacity utilization sinking to 60%. The company should learn a lesson from GM's collapse. The green car strategy unveiled by President Obama, which is aimed at reducing the amount of carbon dioxide emissions can be taken into positive consideration. The Korean automotive industry should make efforts to develop high-fuel efficiency vehicles and environment-friendly cars under labor and management cooperation, building up capability to take a lead in the green car market. The ROKG should provide liquidity and structural assistance to the automotive industry. For example, the French and German governments are providing aid worth millions of won when consumers exchange a used car with a new car. The ROKG's proposal to develop green cars under the green new deal policy seems uninspiring. The ROKG should hasten to foster a public-private joint fund for developing green cars in order to develop and standardize hybrid cars and electric cars. Stephens 1