KOREA Recent political developments in Korea augur well for the future of that country. The revolutionary military regime which took over the reins of the country in 1961 has been succeeded by a democratically elected, relatively stable government, with a number of political assets. Governmental institutions exist; the executive powers are exercised by a freely elected President; there is a functioning legislative body with a considerable amount of independent powers distinct from those of the executive branch; judicial power is vested in the courts; and well-trained civil service officials are available. On the negative side, corruption and graft are still in evidence in many public and private transactions in spite of President Park's strong efforts on behalf of high standards in public and private life. Personal power and gain continue to exert considerable influence on the behavioral pattern of the Korean society. Recently, Korea has taken several highly important and historical steps demonstrating their growing political maturity. MILITARY CONTRIBUTION IN VIETNAM Direct military assistance furnished by the Government of Korea to South Vietnam exceeds the contributions of all other countries except the United States. In August of last year, responding to the request of the South Vietnamese Government, Korea's National Assembly approved the sending of a full combat division to that beleaguered country. The total of the Republic of Korea forces now serving in Vietnam is nearly 21,000. Korea's response to South Vietnam's plight has not gone unnoticed in the Far East. It constitutes a concrete expression of adherence to the principle of collective security. We earnestly hope that Korea's example in this instance will be emulated by her neighbors among whom several could do even more than they are now doing to advance the cause of freedom and security. United States assistance to Korea should be continued at a level which gives full consideration to the need for that country to attain economic viability. Additionally, sufficient U.S. military aid to enable Korea to maintain its posture of defense against Communist North Korea and its assistance to the free world efforts in Vietnam should be continued. KOREA-JAPAN NORMALIZATION TREATY Despite vociferous opposition, the normalization treaty was signed and ratified in 1965, ending a half century of Korean-Japanese strife. On June 22, 1965, the Foreign Ministers of Korea and Japan signed in Tokyo the necessary six agreements. These agreements, with the draft treaty that had been previously initialed, resolved outstanding differences that had existed since Korea's liberation. The agreements were ratified by the National Assembly on August 14, 1965, over heavy opposition, including the resignation of all People's Party assemblymen. These resignations were subsequently rejected by the National Assembly and some 55 members have returned. The Japanese in order to assist Korea's economy agreed (1) to grants amounting to $300 million over 10 years; (2) to $200 million in soft loans; and (3) to facilitate the entry into Korea of an estimated $300 million in commercial credit. In addition, agreements were made establishing an area of jointly controlled fisheries, to replace the "peace line" area in which Korea had claimed exclusive fishing rights; defining the rights of Korean citizens living in Japan; providing for the return of Korean art treasures taken to Japan; and arranging meetings for the settlement of disputes in the future. In late August protests were organized by students of the public universities in the Seoul area against ratification of this treaty. The Government suppressed these demonstrations by closing the universities for a short time and demanding the removal of the responsible agitators. Following compliance with the President's demands, the universities were reopened. President Park told us that he sincerely believed in the right of all students to pursue their studies and he would protect that right. But the students through demonstrations were producing an unhealthy influence over Government policies. Because of the uncertain and unknown quality of the student leadership, it was necessary to restrict student activities to more ordinary channels. If the student element were to become more responsible it could prove highly beneficial to the economic and political stability of the nation. ECONOMIC GROWTH This As political stability in Korea has developed, so also has come an impressive rate of economic growth. The nation achieved an increase in its gross national product of 8.6 percent in 1963 and 8 percent in 1964. The Government is carrying out a comprehensive economic stabilization program calling for a balanced budget, ceilings on monetary and credit expansion, and increases in domestic savings. In addition, the currency has been devaluated, the civil service upgraded, Government subsidies reduced, and tax reforms introduced. Industrial and agricultural production both are showing steady increases, while prices remain relatively stable. Exports have been increased sixfold since 1959, from $20 million to $120 million. has relieved but has not solved Korea's severe balance-of-payments deficit. Continued foreign aid will be essential to assist in the maintenance of the armed forces and to support economic development. Despite a number of problems Korea's progress is encouraging and should continue if sound fiscal and monetary policies are pursued and the political situation continues stabilized. A most heartening development is the pride that Korean officials are taking in these economic developments, and the enthusiasm they display for undertaking the reforms and self-help measures needed for continued successful growth. The United States should do everything possible to develop and expand Korea's export market, including items produced in Korea which might be valuable to the U.S. military and economic effort in Vietnam. The study mission was informed about a number of items that can be produced in Korea at a competitive price. They include: knit goods; textile fabrics and garments (e.g., military clothing); rubber and leather footwear (e.g., jungle boots); tires and tubes; auto batteries; auto parts; paper goods; blankets; cement, glass and other construction materials. Some might successfully find commercial markets in Vietnam or be purchased through U.S. aid programs in Vietnam. Responsible U.S. officials should thoroughly explore these possibilities. |