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Park champions 'creative economy' as solution to high unemployment at G20 summit

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(Globalpost/GlobalPost)

By Chang Jae-soon

SAINT PETERSBURG, Russia, Sept. 6 (Yonhap) -- South Korean President Park Geun-hye on Friday championed her "creative economy" vision and fair market competition as solutions to high unemployment and widening inequalities facing the global economy as she delivered a lead speech at a Group of 20 summit in Russia.

"Creative economy" refers to Park's trademark growth strategy that calls for boosting the economy by creating new business opportunities, industries and jobs through the fusion of information and communication technology, culture and other realms.

Park believes the existing paradigm of economic growth has reached its limit as it is unable to address high unemployment and widening economic inequalities. She says the world should think up more creative ideas to develop unheard-of industries that can serve as new growth engines.

"Since the global financial crisis, the world economy has been restoring stability to some degree ... But the problems of high unemployment rates and imbalanced growth continue as growth still remains sluggish," Park said during the closing session of the G20 summit in Russia's port city of Saint Petersburg.

Park made the lead speech at the request of host Russia.

She cited South Korean rapper Psy's immensely popular "Gangnam Style" as a good example of the "creative economy" vision, saying the viral song created high added value as it was combined with the video-sharing website YouTube.

"If the past economy used the digging up of mineral resources from the earth as a driving force (for growth), the creative economy is an economy that uses creative ideas from human brains as a driving force," she said.

A key condition for such an economy is to ensure that competition is fair, Park said, calling for the tearing down of institutional barriers to launching creative start-up firms and uprooting the practice of big firms abusing their market power to push start-up competitors out of market.

The appeal is in line with her "economic democratization" campaign, which calls for creating a level playing field for every economic player amid widespread perceptions that South Korean conglomerates have abused their market dominance to prey on smaller firms.

"Let me compare this to a sports game. We have laid out game rules and strengthened competitiveness of players, but we have lacked efforts to ensure whether the game is played by the rules and if they are fair rules," she said.

Park said the world economy should seek "inclusive growth" through job creation if it wants to realize the G20 goal of strong, sustainable and balanced growth. Seeking a creative economy based on fair market competition is key to the inclusive growth, she said.

The G20 summit, which opened on Thursday, concluded later Friday with a joint communique where the leaders pledged closer policy coordination to help spur a still-weak recovery of the global economy, tackle high unemployment and address imbalanced growth.

This year's summit comes as the United States is expected to soon scale back its monthly bond-purchasing program, known as quantitative easing. The planned tapering off of the stimulus measures was a key topic at the G20 meeting amid concerns it could destabilize emerging economies.

In the joint communique, the leaders agreed to strengthen coordination on "exit strategies" of advanced economies, saying the central banks of member nations "have committed that future changes to monetary policy settings will continue to be carefully calibrated and clearly communicated."

That reflects an appeal Park made in Thursday's opening session, where she urged advanced nations to be more careful when changing their monetary policies. She said advanced countries should care about emerging economies, just as emerging nations contributed to global economic growth since the 2008 world financial turmoil.

The G20 leaders also agreed to strengthen crisis management systems, such as regional financing arrangements (RFAs), which are a pool of emergency funds contributed by economies in a region for use in emergencies, and extend their standstill commitment on trade protectionism until the end of 2016.

On the sidelines of the summit, Park met bilaterally with Italian Prime Minister Enrico Letta and U.N. Secretary General Ban Ki-moon on Thursday. She held one-on-one meetings with German Chancellor Angela Merkel and Kazakh President Nursultan Nazarbayev.

A summit with host Russian President Vladimir Putin was set for later Friday.

Russia was the first leg of Park's two-nation trip that will take her to Vietnam on Saturday.

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