A zombie refers to a corpse that has been brought back to life. Today, zombies are walking about on the face of the earth once again. Businesses that should have already collapsed are still barely hanging on to survive and such trends tend to hamper economic order. The ‘Big 3’ American automakers, including GM which has long since become a fallen angel, are bearing through on financial relief. Financial institutions on Wall Street, scratched by the financial crisis tsunami, are also keeping alive with the help of IV injections otherwise known as public funds.
The United States is not at this alone. Europe is also pouring astronomical amounts of money to rescue firms and financial institutions. Countries are openly carrying out government intervention to ensure that funds are not leaked to other economies through measures such as pursuing the nationalization of banks and lifting the ceiling on deposit protection.
The evils that would occur should governments put up high walls of trade protectionism and prevent the imports of foreign goods are not slight. If companies and financial institutions that should have been liquidated swagger along again with government support, global competitive order would be distorted and regular industrial development would also be impossible. Therefore, the whole world must be cautious of trade protectionism.
Korea, which heavily depends on trade to move beyond its small domestic market, must take the lead in opposing the acts of distorting global competitive order and raising trade barriers. Moreover, our own policymakers must make sure that they do not give life to zombies. There would be no end if crumbling firms are kept alive. Falling companies should be left to fall. The government should also not excessively extend capital to banks in order to heighten their Bank for International Settlement (BIS) capital adequacy ratio.
[Translated by Eun-young Sa / JYJ]
[ⓒ Maeil Business Newspaper & mk.co.kr, All rights reserved]
[출처 : 매일경제]
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