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Seoul G20: South Korea's coming-out party

Analysis: As world leaders meet in South Korea, the global economy will likely be left in the lurch.

Seoul South Korea G20 Summit
A South Korean model wears a traditional costume at the rehearsal of a fashion show at Changtuk palace in Seoul on Nov. 9, 2010. (Park Ji Hwan/AFP/Getty Images)

SEOUL, South Korea — “Clean Seoul,” says a voice on Traffic Broadcasting System, Seoul’s most listened to radio station.

“Don’t drive, take the subway,” says another voice, urging Seoulites to stay away from COEX, the vast Convention and Exhibition Center in Seoul’s high-priced, high-rise Gangnam district, south of the Han River that bisects the capital.

That’s where leaders of the G20, 19 countries plus the European Union, meet on Thursday and Friday to try — yet again — to rescue the global financial system after three years of uncertainty and turmoil.

For South Korea, the G20 is a coming-out party — a chance to show the world how far the country has come since its basket-case years after the Korean War. It's a new South Korea, one no longer buried in debt from the 1997-1998 economic crisis and relatively spared by the downturn of recent years. It's an economic force worthy of the world's respect.

The enthusiasm that influential Koreans exhibit over the G20 is infectious. The line most often heard: It’s the greatest thing to happen to the country since the 1988 Seoul Olympics.

“It’s historic,” said Chang Yu Sang, a professor at the Korea Development Institute, “Korea never had this kind of exposure.”

He’s confident South Korean society will reap rewards even if the summiteers fail, as many expect, to agree on what to do about China and Germany’s yawning trade surpluses with the United States and constant U.S. demands for China to increase the value of its currency — to say nothing of the ongoing war of words over the U.S. Federal Reserve's decision to pump $600 billion into the U.S. economy.

Above all, Chang said, “Korea will be discovered as a country that’s really important.”

Officials here see the meeting as a test of Korea’s diplomatic and political as well as economic maturity. South Korea, they like to say, fills a unique position between the world’s advanced and developing nations with which they sense a special rapport dating from the dark days after the Korean War when Korea was among the world’s poorest countries.

Korean pride aside, the challenges to getting anything done are significant.

How can U.S. President Barack Obama, for instance, manage to come to terms with China’s President Hu Jintao or German Chancellor Angela Merkel on what to do about problems ranging from currency imbalances to banking regulations?

“I don’t think G20 will really resolve the differences,” Chang said. “There’s a negative side that dominates the whole conference.”

Somehow, though, he thinks it’s all going to work out.

“When the G20 leaders get together, they’re going to have a good time and say, ‘Let’s try to work together,’” he added.

South Korea’s President Lee Myung Bak, a summit host, insists that this G20 will leave a lasting legacy. “G20 was formed in the midst of unprecedented financial crisis,” he said at a recent luncheon for foreign correspondents in the Blue House, the center of presidential power. “Every country taking part must not pursue unilateral interests. The summit will not just be a talk shop. G20 will produce a lot of trust around the world.”

It’s a lofty ambition that skeptics believe may be impossible. The overwhelming sense is that the whole confab will wind up with an “action plan” that’s long on rhetoric but short on substance, said Obama’s financial guru, Lawrence Summers.

“The imbalances will not be fixed,” Summers said recently in a live teleconference from the White House to a meeting of the Asia Society’s Korea Center. In the absence of real consensus, however, he is “confident we will reach a successful outcome” — a forecast that suggests a face-saving piece of paper but not a lot more.