"South Korea, negotiations with Trump? Postpone it unconditionally." The reason why the trade expert emphasized 'fool strategy' is because

■ Broadcast: YTN Radio FM 94.5 (09:00-10:00)
■ Host: Reporter Cho Tae-hyun
■ Air date: January 21, 2025 (Tuesday)
■ Talk: Kim Heung-jong, Special Professor of International Studies at Korea University (Former Director of the Institute for International Economic Policy)

* The text below may differ from the actual broadcast content, so please check the broadcast for more accurate information.

◇ Reporter Cho Tae-hyun (hereinafter referred to as Cho Tae-hyun): Let's continue with the second part of YTN Radio Live Economy. In the second part, we're going to approach Trump a little more in earnest. I'm going to be a dictator on the first day before I take office. I'm going to pour out executive orders. I've talked about this and many things, so I've been paying a lot of attention to how much this person can really do. The outline is coming out little by little. Let's connect with Kim Heung-jong, a special professor of international studies at Korea University, on the phone and talk about various things related to it. Is the professor out?

◆ Kim Heung-jong, Special Professor of International Studies at Korea University (hereinafter referred to as Kim Heung-jong): Hello.

◇ Cho Tae-hyun: Yes, how are you? Professor, first of all, the executive order is gradually being unveiled. I'll talk about this again later. How did you hear the inauguration speech? What do you remember the most?

◆ Kim Heung-jong: I defined it in a word, 'I will open a golden era.' I think that's the most meaningful keyword. Last time, he said he would make America great again eight years ago, and this time, he said he would go beyond that and open a golden age, conveying a message that gives the American people dreams and hope.

◇ Cho Tae-hyun: Such messages that present dreams and hopes. Emphasized the golden age. If you look at what has been reported so far. The news that I signed Executive Order No. 1 is now being delivered. In particular, it seems that they have signed various things, including the withdrawal of the Paris Climate Change Agreement. In the end, we withdrew from the Paris Climate Change Agreement again.

◆ Kim Heung-jong: Trump basically believes that all small international agreements are cumbersome and cumbersome interference that does not properly reflect the interests of the United States, so it can be said that he has firmly decided to withdraw from the Paris Agreement and to follow his own energy policy or carbon neutrality policy according to his own schedule.

◇ Cho Tae-hyun: But when you really leave like this, don't you give China an opportunity to raise its global status?

◆Kim Heung-jong: Not only is China leading the way when it comes to carbon policy, but it is also taking control of everything that is justifiable. Under the current circumstances, if the U.S. withdraws from the Paris Agreement, it will eventually fall short of China's diplomatic power when it comes to carbon neutrality policy. You can only look at it like this.

◇ Cho Tae-hyun: There is a possibility that China will take the global lead. If this happens, I think we will be further away from the golden age or MAGA. Anyway, we made this choice. Other than that, government censorship bans, restoration of freedom of speech, and the end of government weaponization against political opponents. I heard that they signed this, too. And I will also sign a pardon for these people in the 2021 Capitol riot. Isn't it too dangerous in general?

◆ Kim Heung-jong: Yes, of course, in that respect. In the end, I think that's what he did for his supporters. The most important thing is to be more decisive in the part related to the deportation of illegal immigrants, but didn't you say that it was symbolically shown in a city or sent troops to the south? It's not going to be fully implemented in the end just because it's showing a more thorough border defense, but it's going to be something symbolic of illegal immigrant deportation.

◇ Cho Tae-hyun: It is likely to be a symbolic move. Actually, when I watch a scary movie, there are 100% ghosts in it, but I don't know when it'll come out, so I say this when I feel anxious. I think this might be a tariff from Trump, but the story of this tariff has only been talked about in principle. How did you like it?

◆ Kim Heung-jong: As for tariffs, he is saying that he will impose universal tariffs on all goods in all countries and add additional tariffs on certain electric vehicles, especially in countries such as China. What needs to be closely watched is that raising tariffs is not necessarily good for the U.S. economy. Therefore, putting tariffs on goods, materials, and intermediate parts will hurt the U.S. as if it were a thorn in the fish. Nevertheless, we will continue to negotiate with countries one by one to impose universal tariffs. I'm sure this is because I said it. I do, but I'm not going to do it for every product or every country. That's how you can see it. Countries with preferential trade agreements like Korea, like the Korea-US FTA. It is expected that it will be applied to these countries without exception. So, I think that once we explain the principle that we will do that, we will try to make a deal with each other in this way in the form of negotiating and taking it out individually. I'll take this out, and then you'll give me something. Like this. So basically universal tariffs, I think this principle will continue to be argued.

◇ Cho Tae-hyun: But on the first day, there was no specific talk about tariffs. This is the result of the Trump team's unresolved differences, and there is also an analysis from the local area. How does the professor evaluate it?

◆ Kim Heung-jong: It's true that there are disagreements, but some kind of tacit agreement has already been reached among those who are now pushing for Trump's core trade policy. So disagreement is what you see from the outside. So it's more accurate to look beyond that stage and to see it now as a stage to discuss what strategies and customs policies to use specifically for which countries.

◇ Cho Tae-hyun: Yes, I see. Assuming that you will eventually do it, how do you predict when you will really introduce it and shock the world?

◆ Kim Heung-jong: I think we'll take action on this in the next 100 days. Currently, we usually count the number of presidential executive orders on the first day, then within 100 days, or within a year. Surprisingly, the actual number of executive orders has decreased significantly compared to 10 years ago and before. Once upon a time, the 80s and 90s were a lot more. Then, it decreased gradually, and the number of executive orders President Biden made was higher than that of the Trump era. There were more, and there were more we did within 100 days. We think the other way around, but that wasn't really the case. But now Trump is saying he's going to do more of that. That's arithmetically possible because once the policy of reversing what Biden did, the number will increase. So I'm going to do that and include everything I do. So, I can expect that within a very 100 days, the tariff policy will be very visible.

◇ Cho Tae-hyun: I think we'll have to wait and see for about three months.

◆ Kim Heung-jong: Yes, we only have three months.

◇ Cho Tae-hyun: That's right. Then, as you said, we don't have time, but I think there will be a good chance of making exceptions by negotiating individually by country. How should we respond?

◆ Kim Heung-jong: We basically know how much our country contributes to our current export of goods and the U.S. economy. I have a lot of evidence. In particular, Korea is producing a lot of intermediate goods as well as final products in the United States, as well as China. And we export intermediate goods to Korean companies that have invested in the United States. It's intra-company trade. There is a lot of such diverse evidence that it is contributing to the U.S. economy, so negotiating with these things opens up the possibility of significantly reducing the impact on key areas that are important individually. You don't have to be too scared.

◇ Cho Tae-hyun: There will be enough ways to respond. I see. Let's take a look at Trump's overall stance once again. When I looked at the White House website, it revealed that it was a six priority policy agenda. Ending inflation and lowering the cost of living, tax cuts for American workers, strengthening border security, restoring peace through strength, energy hegemony, and making American cities safe again. Let's take a look at the water price first. I think it's a completely different story from prices and customs. What do you see as Trump's plan to control prices?

◆ Kim Heung-jong: As for prices, the fact is that Trump's condemnation of that Biden administration's policies is carbon neutral, excessive green policy. They claim that the carbon neutrality policy has brought about inflation. However, even if there is a little inflation, it has not had much impact, but on the contrary, various policies of the Trump administration are likely to bring about inflation now. The tariff policy will trigger supply-side inflation. Then, considering the various government spending currently planned by the Trump administration, a large government fiscal deficit is expected, which will raise interest rates on government bonds. And then eventually this stimulates market interest rates, so interest rates will continue to be at a high level. In that case, if interest rates rise, the Fed cannot easily lower the base rate. If you can't lower interest rates easily, then eventually the dollar will continue to strengthen and become this vicious cycle, so there's also a problem with inflation, and if you suddenly expel illegal immigrants now, even if you don't have a massive deportation of the entire country, if you catch an area and expel illegal immigrants from that area, you'll have a serious blow to agriculture and some services. So labor costs will rise in this area. So all of these things, in the end, it's not going to be easy to catch inflation. I'm looking at it like this. It is the recent strong dollar trend that reflects such market expectations. So I think it's not easy to achieve from number one, but now the Trump administration seems to be thinking that if inflation is not caught, it will forcefully negotiate with each sector to lower prices.

◇ Cho Tae-hyun: Is it possible? That? I think there are a lot of interesting stories. The story of the Panama Canal. There is a lot of controversy right now, but I also talked about this in my inauguration speech. China is operating the Panama Canal. I think we're putting a lot of emphasis on getting it back, do you think there's a possibility that we're going to take substantial action?

◆ Kim Heung-jong: This is possible. Because the Panama Canal has been run by the U.S. and eventually handed it over to Panama two to 30 years ago, and as a result, it's kind of like China has created a surveillance network on both sides of the Panama Canal, which is a violation of America's core security interests. So this is actually much more specifically than the current conversation of Greenland or Canada, which threatens to violate the core U.S. security interests, so the first thing to do in this area is probably to negotiate with the Panama government to ask for it to be handed over in a complete manner, or even if the Panama government manages it, we will certainly establish a system in which the U.S. interferes from the side to the back.

◇ Cho Tae-hyun: But the Panama government is very sensitive. This is internal interference. What do you think about the possibility of the Panama government accepting negotiations?

◆ Kim Heung-jong: I will accept the negotiations. I can't help but respond. Various economic sanctions are expected. Then, we will negotiate like that while properly guaranteeing the profits of the Panama government's canal operation, so in the end, hand over the management to us, I'll take care of the profits. I think the negotiations will proceed in this way.

◇ Cho Tae-hyun: We will have no choice but to start negotiations. I think we need to wait and see what happens to this part. Cryptocurrency Let's talk about this part. I'm going to be the president of cryptocurrency, and I've talked about it many times. He even issued a meme coin himself. Didn't you talk about this in your inaugural address?

◆ Kim Heung-jong: We talked about that in the inaugural speech and many other places. Of course, it's not explicitly revealed in the inaugural address.When it comes to cryptocurrency, Trump was very negative in the past. I changed my mind after that. There are a few things like that. So the cryptocurrency sector is going to boom like this and use it as a means of economic vitality, but cryptocurrency actually helps boost domestic consumption. Because cryptocurrency assets are built on cryptocurrency assets and boosted the economy through optimistic outlooks, because this is a new field. So, it seems that we are also considering revitalizing the economy and domestic economy in this way.

◇ Cho Tae-hyun: But I personally didn't understand it. Trump's meme coin. Dollar Trump. He's publishing this, he's promoting it himself, and the Trump group has 80 percent of it. If I did this in our country, it would have been really crazy, but is this an acceptable culture in the United States?

◆ Kim Heung-jong: The United States has a very strong capitalist tendency and will not hide it compared to Korea, but will explicitly be so transparent. When it comes to doing it this way, culture doesn't seem to be the kind of culture that has this reluctance.

◇ Cho Tae-hyun: Let's say culture is like that, but isn't there a conflict of interest legal issues?

◆ Kim Heung-jong: Legal issues now include numerous presidential orders, there are numerous legal issues regarding cryptocurrency asset management. So it's very likely that in the future, the executive order and this cryptocurrency, and that's how these actions will go in a bunch of lawsuits.

◇ Cho Tae-hyun: I think this is also likely to be noisy for a considerable period of time to come.

◆ Kim Heung-jong: Yes, that's right.

◇ Cho Tae-hyun: As soon as Trump starts his term, the U.S. national debt seems to be another problem. The legal ceiling has been reached. I think it will be the 21st right away, so tomorrow in our time, but I heard that special measures will be implemented. What is the situation now?

◆ Kim Heung-jong: The direction now is to raise the upper limit. That's all in both houses now that Republicans are the majority and now all Republicans have turned into ex-Trump figures, so I'm going to raise that cap for now. In the process of raising the upper limit, the federal government is locked down in the middle or the budget is not sufficiently supplied, and even if it goes through that, it will strengthen Trump's position. So even after all that, I will raise the deficit cap anyway.As far as I know, DEN is preparing various plans. The more controversial it is, the more favorable it is to them.

◇ Cho Tae-hyun: Okay. The negotiator's temperament seems to have been fully revealed in this area as well. It's only the first day. It's even the first day that's not over yet. Whether you like it or not, we have no choice but to go with Trump for the next four years. If there is anything we should keep in mind in this situation, what would the professor say?

◆ Kim Heung-jong: First of all, it's clear that uncertainty has increased, but we don't necessarily see this increase going on all four years. And I think this could eventually lead to an increase in uncertainty in about 100 days, or this year or so, when everything is done, it could turn back into a sufficiently predictable situation. So, there are shocking things about various issues.Ma said, "If we make a good strategy and respond like that, we can respond relatively well as we did in the first Trump period." The biggest problem in our country right now is the lack of leadership due to political uncertainty, and given that this continues for the next six months or so, Trump is not saying anything about the situation in our country right now.In the end, it is very likely that we will try to fulfill those key U.S. interests over the next six months amid this uncertainty. That's why we have to pay attention to these areas. For now, you have to postpone it unconditionally. So in order to do that, we have to do our best. It looks like this.

◇ Cho Tae-hyun: Since the government's leadership is in a state of collapse, the best strategy is to postpone it as much as possible. That's what you're saying, right?

◆ Kim Heung-jong: When we negotiated, we took leadership and we stabilized. We’ll do that. You can't do it like this. We can't, we can't, so we have to do it later. Rather, you have to do that. You have to go out the other way.

◇ Cho Tae-hyun: It's a strategy that can seem a little stupid normally, but I think it's a choice that can't be helped right now.

◆ Kim Heung-jong: That's much better. You have to do that.

◇ Cho Tae-hyun: Okay. So far, we have looked at various contents that need to be Trump's second term and our response strategy with Kim Heung-jong, a special professor of international studies at Korea University. Thank you for talking today.

◆Kim Heung-jong: Yes. Thank you.

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