Despite the fact that world is on the trend toward a unified world economy through establishment and strengthening of WTO system, as far as the powerful economic blocs such as NAFTA and EU are existent, there is and urgent need for the nations of East Asia also to form and strengthen their cooperative system among themselves for the sake of region. Suppose there had been an established mutual assistance system such as EU, for instance, among the nations of East Asia when a financial crisis that had hit Thailand in summer of 1997 has spread its waves of impacts to the entire region of East Asia rapidly through Indonesia and Korea in the very short period of time, causing collapses of regional economies in its aftermath. If it had been the case, surely, much effective countermeasures would have been possible to overcome and control the crisis. Moreover, the financial crisis hav also provided the East Asian nations with an opportunity to realize how vain their economic growth had been without their viable foundations for economic stability. And especially in view of the current world trade circumstances in which globalism and regionalism find themselves coexisting, it could be safely assumed that coping with recurring crisis including the financial ones through established economic cooperations among the East Asian nations as a unified regional group is an imperative precondition for pursuing growth founded on the solidly stable structure.  Considering everything including the degrees of their respective economic development and economic scales, Korea and Japan are, it is believed, two major centers in the East Asia region, and they should be taking leading roles in strengthening the economic cooperations among the nations in theis region of the world, with the ever closer cooperations between Korea and Japan not limited to the two concerned only. On the other hand, however, when the fact taken into consideration that industrial structures of Korea and Japan are rather of compete tive character, efforts should be rendered to make crystal clear the comparative advantage of the two nations in order that their competitiveness could be reduced and adjusted, and that the strong cooperative relations between the two neighboring countries in the region could be made most possible through such efforts, For such golas, its it urgently called for that a free trade area should be set up between Korea and Japan.

This paper deals with the effect of foreign direct in vestment (FDD on industry and on international analysis on the effect of FDI on international trade was made. The gravity model was adopted for that purpose. It turns that the increase in FDI in Korea induces the increase of exports as well as imports. But the net effect, that is, the effect on trade balance, turns out to be positive, if not significant. Survey of 1,286 foreign firms in Korea were made as well. The survey shows that FDI in Korea is, in general, market oriented. The average ratio of imported raw materials as well as the average ratio of domestic sales to exports are relatively high. The market oriented nature of FDI is noticeable especially in transportation machinery and other manufacturing sector, and in FDI from the United States.

The Asian currency crisis rekindled interest in the consorted efforts for stabilizing exchange rates among Asian currencies and coping with the possible shortage of international liquidity in the region. With most of external transactions denominated in the U.S. dollar, a sudden change in supply of and/or demand for dollars may have a serious impact on the international liquidity position of the region as a whole. At the same time, under the situation that the exchange rates of regional currencies are de facto pegged to the U.S. dollar, the fluctuation of exchange rate of the dollar against the other major currencies, i.e. the Japanese yen or the German mark, may destabilize foreign transactions of the Asian countries.  In fact, the volatility of exchange rate of the Asian currencies against the Japanese yen has been one of the major reasons for economic instability in the region. Therefore, it seems to be logical to insist that Asian countries should lower their dependency on the dollar in external transactions and set up an institutional mechanism such as the jointly tloating exchange nete regime to stabilize exchange rates among their currencies and particularly against the yen.  This paper aims to evaluate the possibility that the formation of the yen-bloc in Asia can be a viable option for deterring recurrences of the crisis. For this purpose, we try to quantify the possibility of participating in an optimum currency area by estimating the weigth assigned to each of three key currencies (the dollar, the yen, and the mark) included in the basket currency peg. Then we apply an optimum currency area model, which explains that possibility of joining a currency bloc by using explanatory variables such as asymmetry of shocks, trade interdependency, and the size of concerned economies.  The major finding of this paper may be summarized as follows: Asia is not an optimum currency area. The economic fundamentals of Asia are radically different from those of Europe. Meanwhile, the currency crisis which forced the Asian countries to give up their dollar peg system and increased the need for autonomy of monetary policy for stabilization will work as a deterrent to joining a currency bloc. If the currency crisis is over, however, the basket currency peg may emerge as an alternative to both single currency peg and the flexible exchange rate regime. In that case, the weight of the yen needs to be adjusted to a higher level, while the opposite is true for the U.S. dollar.

This paper has investigated the performance and successful strategies of information and telecommunication (IT) venture business in Korea to analyze their venture incentives, competitive advantages, business and administration obstacles, and improvement desires on the government. The contents are summarized as follows:  Firstly, they pointed out the energetic characteristics of entrepreneur and the competitive advantages in technology as the most important foctors in IT venture business.  Secondly, IT venture firms have pointed out the lack in high quality man power as significant management obstacle, then orderly pointed out the development of technologies, sales and marketing, and administration procedure and regulation as their main management obstacles.  Thirdly, IT venture firms have orderly demanded the government the preferential measures such as supporting and financing the venture investment capitals, the prompt administration procedure, and establishment of technology network.  Thus we should establish the system to secure intelligent entrepreneurs and high technologies, venture capital, and venture networking in IT venture business. We should also vitalize the venture infrastructure, improve the environment of venture business, and adopt the effective marketing and positive internalization strategies to enter the world market.

Korea and ASEAN had experienced a rapid growth of bilateral trade and foreign direct investment(FDI) flows before the advent of Asian financial crisis. This paper intends to explore trade and FDI relations between Korea and ASEAN during 1988~1995. Several descriptive analyses show that Korea`s FDI on ASEAN was positively related with its exports to ASEAN as a whole. Industry-level study also reveals that a positive relationship of trade and FDI between Korea and ASEAN in major manufacturing sector can be found. From the analysis, it is emphasized that trade and FDI between Korea and ASEAN had a complementary relationship, and Korea`s FDI on ASEAN should be focusing more on production for local consumption expecting a larger and more integrated ASEAN market.

This paper analyzed economic and institutional changes taking place in europe and the rest of the world induced by the launch of Euro by the beginning of 1999, and investigated the conditional changes for Korean exp0orts directed to European countries. Major findings of the paper are as follows.  First, the paper expects that the newlya-established European Central Bank (ECB), which is solely responsible for the single monetary policy for the Euroland, will continue the so-called "passively expansionary monetary policy," which will be supported by the continuous restrictive fiscal policy. Even though the latter is in the hand of the national governments, the virtuous economic policy cycle of this kind will be the basic policy direction of countries participating in the Euor. In certain circumstances, however, the ECB`s monetary policy maybe confronted with an increasing pressure from the ECOFI Council to reduce interest rates, especially in the countries with relatively high unemployment rate. This might lead to conflict bewteen the two policy authorities.  Second, the policy mix mentioned above is in general expected to bring about stimulus to the economic activities of European countries, thereby contributing to a positive short-and mid- and long-term growth potential of participating countries, which will in turn have additional positive impact on Korea`s bilateral trade account with the European Union.  Fourth, considering the fact that the Euro has shown a continuos depreciation trends against the US dollar so far, a reversal of modest extent is expected for the short- and mid-term, which will lead to increasing exports from Korea to Europe.  Fifth, the launch of Euro will enhance the price transparency in the European markets, lead to downward movement of prices of tradables produced in europe, and stronger trade diversion due to increased integration of European economies. These will counteract, in the short- and mid-term, to the positive impacts on the Korean exports listed so far.  Sixth, trade diversion effects are expected to be relatively high in the electronics, telecommunication facilities and computer products, automobile and petrochemical sectors, that traditionally show high intra-Eu trade relations, so that Korean companies in these sectors will need to give more efforts to cut costs and improve productivity, so as to overcome these additional competition challenges. The launch of Euro also reuires Korean companies to realign their business strategies, including marketing, production management, financial operation, as well as risk management, etc.

Rapid progress in electronic commerce and cyber trade, which symbolize the digital economy in the 21st century, is fundamentally changing the competition paradigm of the global economy. Accordingly, advanced countries, including the U. S. and EU are making various efforts to secure comparative advantage in the context of international negotiation on the so-called `Cyber Round.` They are actively promoting the early establishment of seven international rules on electronic commerce, which are Non-tariff, Non-taxation, Consumer Protection, Contents Regulation, Encryption, Privacy Protection and Protection of IPR. These new international trade rules will have a great impact on Korea`s perspectives on trade as new rules of cyber trade, which will account for a considerable share of the global economy in the future.  Therefore, unlike in the Uruguay Round, Korea should actively participate in the Cyber Round negotiations. The most important task for efficient trade negotiations is to clearly define the `trade interests.` that Korea should pursue. However, cyber trade interests are difficult to define due to cyber trade`s speed of development, unpredictability and the dual characteristics of the Korean economy as an intermediary country. Therefore, the top priority for Korea`s negotiation strategies is to clearly define cyber trade interests and to carry out aggressive negotiations to reflect them in the international arena. Unlike bilateral negotiations, the Cyber Round of negotiations proceeds within a multilateral framework which does not specify negotiating partners. As a result, participating countries might easily find themselves in a so-called Soft Positional Negotiation Game, where they follow opinions of some `invisible leading countries.` Therefore, Korea should pursue Principled Negotiation Game to realize its cyber trade interests as an intermediary country squeezed between advanced countries which advocate market-driven principle and developing countries which argue for more government intervention.

In Korea, the new discipline of `International Commerce (so-called `Kukje Tong-sang`)` has been established in the 1990`s, as distinguished from the existing discipline of `International Trade (so-called `Muyeok`)` in Korea. Because of the human resources need in the field of international commerce and trade. However, there is no understanding of the differences between new discipline of `International Commerce` and the existing discipline of `International Trade.`  In addition, an argument continues to exist among Korean scholars regarding the clear distinction between `International Commerce` and `International Trade.` In advance of this kind of issue whether there are no disciplinary differences in `International Commerce` and `International Trade`, the reality is that there are two different departments of `International Commerce Department` and `International Trade Department` in the same Korean universities.  Therefore, it is very important and urgent to study and to define the conceptual difference between `International Commerce` and `International Trade` in developing and upgrading two discipline in Korea.  However, while the main activities of `International Trade` consists of international business between individuals across countries, the main activities of `International Commerce` are to facilitate the limitation factors in International Business across countries. Therefore, while the main discipline of `International Trade` in Korea would be more related to the private sector, the main area of the discipline of `International Commerce` in Korea would be more related to the public sector.  In order to test the above statements empirically, we have surveyed whether our statements are supported by the other Korean scholars. We have distributed a questionnaire to the students and professors in `International Trade` and the `International Commerce` departments thought Korea. According to the results, the above statements about differences between `International Commerce` and `International Trade` have been largely approved.  However, the point is not to insist the conclusion of this study about the difference between two disciplines but to encourage the discussion and academic interest about the differences or similarities between two disciplines and to contribute to the unique disciplinary development of `International Commerce` and `International Trade` in Korea.

Half of the total foreign investments in Korea in 1998 were made in the form of increased investment. Nevertheless various policies of the Korean government for attracting more investments are focused only on the initial investment. Furthermore, studies and empirical tests have also been concentrated on the same area.  Generally investors of the additional investments are in a better position with easier access to sources of information, thereby obtaining necessary information more efficiently in terms of time and cost than those of new projects. Such information includes major national news, local market trend, and consumer behaviors.  Their comparative-competitive edges, such as lower information-searching cost and capabilities to quickly adjust themselves to changes of a investment environment make it possible for their investment plans to be less affected by uncertainties of the host nation. The results of empirical analysis are consistent with this argument. Whereas initial investments are sensitive to social uncertainty factors such as country risk, increased investments are not as senstive.  The fact that the investors become less risk-averse gives us a clue how to set our targets. We are more likely to accomplish our objectives by putting more enthusiasm and resources into the increased investment than into the initial investment. Policy-makers can establish better systems for inducing foreign investment by understanding these characteristics of the increased investment. It is all the more so when we face fast-changing investment environment.

The recent Uruguay Round led to GATT Article 19 and WTO Agreement on Safeguards.  The purpose of this study is to discuss the operating problems of safeguards, point out the problems of interpretation of GATT Article 19 and WTO Agreement on safeguards in light of Law of International Trade, and explain my personal opinion of the these things. It`s emphasized that the interpretation in view of Law of International Trade should be combined with that in view of law. From the former point of view, the free trade principle has to be observed for the sake of world welfare as well as national one, and the principle that trade must bring a benefit to all the nations concerned should be applied strictly as far as possible, by narrow interpretation, to a nation who puts the measure in operation, in order to make sure the above-mentioned principles will be observed. In case there is a conflict between the interests of developed and developing countries, legal interpretation should be extended and eased, within the limites of possibility, in favor of developing country.