By Dr. Seung-kyung Kim

On October 16, President Park Geun-hye and President Barack Obama will be meeting for the fourth time since they became presidents of their respective countries.  As always, the security issues involving North Korea will be the top item on their agenda.  However, the two countries also have a broad range of mutual interests in such topics as economy, environment, energy, space, health, trade, and cybersecurity.  To this list, I would like to suggest an issue that has been central to both presidents’ interests and commitments throughout their presidencies: the importance of middle class families and the work-family balance that is at the core of sustaining middle class lives in both countries.  Earlier this year in state of the nation addresses, both presidents stressed the importance of enhancing the lives of middle class families and their centrality to revitalizing their national economies.  The work-family balance is no longer a matter of individual life, but a national (even global) issue that governments and policymakers should pick up and do something about.

 The old idea that middle class families consist of a breadwinning father and a homemaking mother has become obsolete in both countries.  In Korea 44% of married couples are now dual earner families (Korea National Statistics Office), while for the United States the figure is 48% (Bureau of Labor Statistics).  The lives of middle class families are thus becoming more challenging because both men and women need to balance family and work responsibilities, and the issue of work-family balance is an important one for both presidents in their goals to improve the well-being of the middle class.

Women are, of course, at the heart of the work-life dilemma because they are placed in much more vulnerable positions than men, both in the workplace and at home.  Not only does the wage gap prevent women from earning the same incomes as men, but women are also more likely to leave the work force in order to assume the responsibilities of child rearing.  Women achieve higher education in both countries at a rate comparable to or higher than men: in Korea, 49.4% of recipients of bachelor’s degrees are women (Korea Education Development Institute) while in the United States, 52.4% of recipients of bachelor’s degrees are women (National Center for Education Statistics).

Both countries have problems with unequal access to the job market.  In the United States, women’s labor force participation is below that of men at all ages except the teenage years (US Bureau of Labor Statistics).  In Korea, women start out with high rates of labor force participation, but, after age thirty, women are significantly less likely to be in the workforce.  The gap between women and men’s labor force participation is highest for people in their thirties, when about 90% of men are in the work force, but less than 60% of women are (Korea National Statistics Office).  This drop can be attributed to the fact that women of this age have child rearing responsibilities that their male counterparts do not.  Even after the end of the peak phase of childrearing, women in Korea do not return to the labor force in numbers comparable to those of men.  The fact that so many women remain outside the labor force is both a loss of productivity to society, and a loss of opportunity to the women.

Governments can assist families trying to achieve work-family balance by instituting policies that help women participate more fully in the labor force.  Among these policies are insuring paid maternity leave, providing quality childcare, and easing barriers to reentry into the labor force.  Both countries need to work on implementing these policies, and both presidents have made efforts to address them.

In terms of women in the workplace, Korea and the United States have significantly different deficiencies.  The United States is the only high-income country in the world that does not require employers to provide paid maternity leave for employees.  The high cost of childcare is another problem in the U.S. as President Obama noted in a recent speech, “… in most states, parents spend more on day care for their children than they would for a year of college” (University of Kansas, January 22, 2015).  South Korea, on the other hand, suffers from the largest wage gap between men and women in the Organization for Economic Cooperation and Development, with women only earning 65% of what men earn.  The low wages paid to women depresses their rate of labor force participation and women who have left the work force find it difficult to resume their careers.  Only 20% of re-employed women are hired for full-time regular positions while more than 60% are hired back as part-timers or contract workers (Korean Women’s Development Institute).

Both presidents recognize the importance of increasing the participation of women in the labor force to their national economies and have presented strategies to achieve this.  President Park has asserted “More participation of women in the economy is a core engine for the nation’s growth” (Wall Street Journal June 17, 2013).  Her government has worked to increase the number of child care facilities and improved their quality.  She also has advocated that employers should create female-friendly work environments and adopt more flexible hours to help working mothers.  Her Minister of Gender Equality and Family, Kim Hee-jung, said “We need for  [companies] to realize that keeping women in the workplace is investing in our future” (Reuters January 27, 2015).  President Obama has identified “high quality, affordable child care” as “a national economic priority” and said he would like to make quality child care accessible to 100 million more children and provide an annual tax cut for their families of up to $3,000 per child. “It is time we stop treating child care as a side issue or a women’s issue,” he said. “This is a family issue” (University of Kansas, January 22, 2015).

Given both presidents’ interest and commitment to work-family balance, I can envision them putting their heads together and discussing these issues. They will find that they have yet another topic in common to discuss and share ideas about.

Dr. Seung-kyung Kim is a Professor, Chair of the Department of Women’s Studies and Director of the Center for East Asian Studies at the University of Maryland, College Park. The views expressed here are the author’s alone.

Photo from  Marcelo Druck’s photostream on flickr Creative Commons.

By Kyle Ferrier

In a 2014 speech in Dresden attempting to apply lessons from German unification to the Korean Peninsula South Korean President Park Geun Hye introduced the possibility for a Northeast Asian Development Bank. Still in the nascent stage of planning, it would serve as a multilateral development bank (MDB) to attract investment in Northeast Asia, specifically intending to incentivize the DPRK to denuclearize through access to external capital for development. Though the origins of the concept for a Northeast Asian Development Bank can be traced as far back as 1991, President Park’s remarks were of great consequence as they signify the beginning of Seoul’s first attempt to materialize the idea. Over the past several weeks South Korea has explicitly sought the support of potential key members for the initiative in the following forums:

• September 2, after meeting with President Park, Chinese Premier Li Keqiang stated China would seriously consider jointly setting up the bank with South Korea
• September 5, Finance Minister Choi Kyung-hwan spoke with his Chinese counterpart at the G-20 conference
• September 9, President Park received the first president-designate of the Asian Infrastructure Investment Bank (AIIB) at Cheong Wa Dae.
• September 15, Vice Finance Minister Joo Hung-hwan met with the U.S. Treasury’s Under Secretary for International Affairs at the Inter-American Development Bank special governors’ conference

With a campaign for U.S. and Chinese approval underway, the upcoming Park-Obama summit next week seems like the natural progression for the ROK to pursue higher support for this endeavor. However, after last month’s landmine incident and the potential for a DPRK provocation, the breakthrough in inter-Korean relations required to initiate the proposed MDB would seem to be quite out of reach in the near future. This may make the Northeast Asian Development Bank appear to be more idealistic than practical, but the merits of such a proposal from a different perspective should not be understated.

The late Robert Scalapino, a highly influential U.S. political scientist, referred to Northeast Asia as a “natural economic territory,” emphasizing the latent economic growth in the Tumen River Basin area. The ability to fully reap the economic gains from this politically divided area is heavily dependent upon cooperation between the governments of China, Russia, South Korea, North Korea, and Mongolia. The United Nations Development Program (UNDP) helped establish the Tumen River Development Program, later evolving into the Greater Tumen Initiative (GTI), with the above countries minus North Korea to facilitate this economic cooperation. The original UNDP estimate in 1991 of $30 billion of infrastructure investment required over 20 years may be quite modest, as some experts estimate the annual infrastructure needs of Northeast Asia to be as high as $63 billion, inclusive of the DPRK.

Though there are several Asian Development Bank (ADB) projects within the greater Tumen area in China and Mongolia, they are relatively small. The introduction of the AIIB will certainly bring more capital for infrastructure, but the estimated $250 billion of institutional capacity expected by 2020 will be stretched thin as infrastructure demand is estimated to reach $8.3 trillion in 2020 within the boundaries of AIIB’s mandate. Furthermore, North Korea is ineligible to receive loans from existing MDBs as it is not a member of the ADB or the World Bank and was rejected by the AIIB earlier this year because of the absence of reliable economic data. North Korea’s absence from regional development initiatives and the underwhelming progress of its Special Economic Zones severely hampers economic growth in the region.

By attempting to ex ante tie formalized development assistance to denuclearization, the ROK hopes to simultaneously capitalize on its security interests, promote the Park Administration’s Eurasian Initiative, and allay the cost burden in certain unification scenarios. However, Seoul has already proposed numerous inter-Korean and regional development projects aimed at incentivizing Pyongyang to abandon its nuclear program without any noticeable success. The most promising factor differentiating the Northeast Asian Development Bank from previously proposed projects is that it would formalize regional economic cooperation between the other GTI members who are also part of the Six-Party Talks: China and Russia.

The key means to influence Pyongyang over the nuclear issue via a Northeast Asian Development Bank proposal is not access to external capital for internal development but the potential for an altered incentive structure to affect Russian and Chinese approaches towards the DPRK. For Beijing, developing the three provinces bordering North Korea and Russia nicknamed the “Rust Belt” is a high priority just as developing the Russia Far East (RFE) region is for Moscow. Tying the institutionalization of cooperation for regional development and the mobilization of funds that it entails with denuclearization would increase the incentive for these countries to utilize their substantial political influence within the DPRK to pressure the Kim Jong-un regime to be more engaged in nuclear disarmament talks. The costs of DPRK disengagement would be much larger in the form of forgone growth to the Rust Belt and RFE. Since the fall of the Soviet Union, Pyongyang has found support in Beijing, which is arguably waning after the execution of Jang Song Taek in 2014. Nevertheless, as U.S. National Security Advisor Susan Rice stated prior to the Xi-Obama summit, China remains a “fulcrum” of influence on the DPRK. The growing rift between these communist neighbors has led Russia to benefit from a rapprochement with North Korea.

The deadlock on the nuclear issue in North Korea has driven Pyongyang to Moscow and Beijing as they are willing to offer support, though to a varying degree, in order for better relations and regional stability, prolonging the current state of affairs. Although growth in the Rust Belt and RFE are of major concern to their respective capitals, both countries also ascribe to the notion that conflict on the Korean Peninsula would create an influx of refugees to these regions that would further deteriorate the local economic situation. In other words, in relation to security strategies, economic considerations have not challenged the status quo. Proposed infrastructure projects, such as connecting a trans-Korean railway to the Trans-Siberian Railway and a trans-Korean gas pipeline to Russia, are intended to work within the existing political economic framework and have seen limited progress. A Northeast Asian Development Bank tying together security and economics may engender a paradigm shift wherein economic factors could motivate Russia and China to take stronger stances for peaceful denuclearization to meet their infrastructure and security interests.

A long-standing supporter of linking the abandonment of nuclear weapons with foreign aid, the United States should pledge its support to a Northeast Asian Development Bank if raised by President Park next week. Though the diplomatic buildup suggests the Northeast Asian Development Bank is likely to be discussed, the possibility for it to further complicate the Obama administration’s response to the AIIB could result in its omission in the media. Yet this possible public relations predicament could easily be managed because the U.S. may be more involved in establishing the structure of the proposed bank from the onset as opposed to observing the AIIB’s creation. There is significant potential for the Northeast Asian Development Bank to bring about long term stability and growth in the region through affecting Russo-DPRK and Sino-DPRK relations and should be seriously considered by any prospective members.

Kyle Ferrier is the Director of Academic Affairs and Research at the Korea Economic Institute of America. The views expressed here are the author’s alone.

Photo from  Jason Rogers’ photostream on flickr Creative Commons.

By Phil Eskeland

With Washington still abuzz from recent visits of Chinese President Xi Jinping, His Holiness the Pope, a few royals from Spain and Sweden, and the resignation of the Speaker of the U.S. House of Representatives, it is important for Washington to focus on the critical upcoming summit meeting between President Barack Obama and President Park Geun-hye of the Republic of Korea (ROK).  The U.S. and South Korea are treaty allies of over 60 years with 28,500 U.S. troops deployed on the Korean peninsula to provide stability and peace in Northeast Asia.  Over these past 60 years, South Korea has also moved from a U.S. foreign aid recipient to America’s sixth largest trading partner, ahead of every European country except Germany.  President Obama has made more trips to Korea than any of his predecessors, demonstrating the growing importance and understanding within the United States of the strong bilateral relations between the two countries.  The October 16^th summit meeting was initially planned to take place last June but President Park decided to focus on ending the Middle East Respiratory Syndrome (MERS) outbreak in Korea before departing the country.  With that goal accomplished last July, the summit was rescheduled for October.

The timing is very appropriate.  With an anticipated provocation by North Korea (DPRK) on or about October 10^th to mark the 70^th anniversary of the ruling Worker’s Party, dealings with the DPRK will be high on the summit agenda.  With the recent success of President Park in responding to the August DPRK provocations on the Demilitarized Zone (DMZ) separating North and South Korea, this prompted a brief glimmer of hope in inter-Korean affairs with the restart of family reunions talks.  However, North Korea may be going back to the old cycle of provocation, negotiation, and resolution with a possible new provocation on October 10^th even over the objections from its only ally China.  A coordinated response between the U.S. and South Korea not just to this possible threat but on North Korea over the long-term is a critical matter to discuss at the summit.  The two countries must be shoulder-to-shoulder on this key national security matter where the threat from North Korea is now the third largest challenge facing the United States out of any other nation-state.  It is important for the two leaders to compare notes on their recent meetings with the Chinese leadership regarding their understanding of how China can play a helpful role in denuclearizing the Korean peninsula and ending North Korea’s destructive cycle of behavior.

However, a summit meeting between Presidents Park and Obama should not be overshadowed by North Korea.  The U.S.-ROK relationship should continue to reflect South Korea’s growing role to assist with resolving global problems well beyond the Korean peninsula.  The Park/Obama summit will discuss issues that both countries can address together such as climate change, development assistance, international peacekeeping, global health challenges, and science and technology.

Economics and trade issues should also not take a back seat to the security challenges facing the U.S. and Korea.  Any slowdown in the economies of East Asia has ramifications for the U.S. economy, both in terms of dampening demand for U.S. exports and inward foreign direct investment (FDI) from Korea to create U.S. jobs.  Korea is now America’s 16^th largest source of FDI totaling over $24 billion in 2012.  I had the privilege of touring two U.S. subsidiaries of Korean firms during my recent trip to Dallas and saw first-hand the hundreds of workers employed as a result of the presence of LG and Samsung in Texas.  But the impact of FDI is more than just the direct employees – every forklift (almost all were electric!) that I saw used at the massive LG warehouse was made by Nissan Forklift (owned by UniCarriers) in Marengo, Illinois (another positive example of FDI).  Thus, workers in Illinois indirectly benefitted from LG’s investment in Texas as well.

The final item that may be discussed privately among the two leaders at the Park-Obama summit is the very sensitive matter of Korea-Japan relations.  The U.S. cannot dictate terms for both countries to improve their relations but the U.S. can play a facilitating role to help narrow the differences between the two countries.  There has been some modest progress in recent months but obviously much more needs to be done.  President Park was remarkably gracious and restrained in her speech after the statement of Japanese Prime Minister Abe marking the 70^th anniversary of the end of World War II stating that his comments “did not quite live up to our expectations.”  This summit will represent another effort to set the stage for a future trilateral meeting of the three leaders, particularly if the “comfort women[PE1] ” issue is resolved within the coming weeks.  Obviously, there could be setbacks along the way but hopefully momentum can be maintained from this summit meeting, along with future U.S. interactions with the Japanese government, to prompt a satisfactory resolution of this matter very soon.  Ironically, if North Korea carries out its proposed missile launch, it will have the effect of bringing Japan and South Korea closer together to cooperate on security matters of mutual concern.

While there is much to discuss in the robust and vibrant U.S.-Korea relationship, expectations are that the two leaders will discuss (1) North Korea; (2) global issues of common interest and concern; and (3) Korea-Japan relations.  If North Korea carries out a provocation on or around October 10^th, the emphasis of the summit may unfortunately once again disproportionately focus on North Korea but hopefully the two leaders will direct the conversation both in public and in private towards issues that recognizes and respects South Korea’s role as leader on various transnational issues that affect people well beyond the Korean peninsula.

Phil Eskeland is Executive Director for Operations and Policy at the Korea Economic Institute of America. The views expressed here are his own.

Photo from the Republic of Korea’s photostream on flickr Creative Commons.