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SOUTH KOREA - THE LAND OF THREE MIRACLES

Mr. President, Mr. Speaker, Mr. Chief Justice, Mr. Samaranch, my predecessor in receipt of this honor, distinguished ladies and gentlemen,

This wonderful award is an extraordinary honor for me at this special time in the history of South Korea and the Korean Peninsula, and in the history of our world. I thank the Seoul Peace Prize Committee and its President Mr. Yong Shik Kim for selecting me.

The breathtaking performance of South Korea over the past three decades has shown to the world what can be done by talented and energetic people when they are given latitude, incentive and leadership. We are entering an information and knowledge age where the key to success is creative people. So now is the time when the achievements of South Korea over the past years put it in a position to make an immense contribution to, and at the same time benefit greatly from, what will surely be a genuinely new era.

So, as you are honoring me, I honor you for your past and prospective achievements. And I seize on this moment to comment on your three miracles and on the progress you are making toward a fourth.

The Miracle of Security

Nowhere in the world have the tensions of the Cold War been so evident as at the DMZ. I have visited that lonely and desolated place more than once and at different periods of time, sometimes as a private citizen, on other occasions as an official of the United States government. The tension is there. You can feel it. You can see by a look at the map or a short ride on a helicopter how close that line is to Seoul. Across that line has been an adversary heavily backed until recently by the two big communist powers, the Soviet Union and the People's Republic of China, both without any ties to South Korea.

North Korea itself seems almost to have dedicated itself to military matters. It has maintained the highest rate of spending on its armed forces in proportion to its GNP in the world. No one can forget the unprovoked attack from the North in 1950. Only with the heroic work of the South Korean armed forces and strong support from the United States was this attack turned back. How fortunate for the people of South Korea that they have not been forced to live under a communist regime and have been able to live in an atmosphere of independence, economic development and political reform.

So, we have seen four decades of peace on the peninsula, a tense peace, a cold peace, but nevertheless there has been no war. Ask yourself why? I think the answer is very clear : the reason peace has been maintained is that the people of South Korea have had the courage to sustain a strong deterrent force. South Korea has produced the military capability with high professional standards and the ability to use modern weaponry. Speaking from the standpoint of the United States I can say that we have been proud to stand by your side, both in the sense of having a most competent American military presence right here on the ground and in the sense of letting you, and perhaps even more importantly your adversaries, know that the United States' immense strategic power is ready to be called upon if needed.

I am especially proud to have been part of Ronald Reagan's administration and to have shared his concern for the security of South Korea. His support was made evident at the very start of his presidency. His first official visitor was President Chun Doo Hwan of South Korea. The message was clear.

I visited South Korea many times during my service as Secretary of State for the United States. But the visit I remember most vividly was the one on which I accompanied President and Nancy Reagan to your country. This visit came in November, 1983 only one month after a vicious terrorist attack engineered by North Korea killed four members of your Cabinet. President Chun Doo Hwan escaped by chance. This tragedy was especially personal to me since I had come to know and respect greatly your former Foreign Minister Lee Bum Suk. There were many here in South Korea and in the United States who advised President Reagan and me that we should not come to South Korea at such a tense moment. Our reaction was exactly the opposite. We felt that this was the time to stand firmly by our friends and so the President and I came.

The visit was an exuberant success. South Koreans lined the streets for the President's arrival. He spoke to your National Assembly about peace and the necessity of strength if you want to have peace. He spoke of his dream that the world be free of nuclear weapons. And he spoke of the importance of moving your country ahead not only economically but into a presidential succession managed through an electoral process, as President Chun Doo Hwan promised at the beginning of his term.

The point, however, is that President Reagan and I would not be intimidated. Nor would your President. Nor would your people. Together we constructed an armed force capable of deterring aggression and, therefore, capable of keeping the peace.

You have sustained this strong deterrent capability over a period of four decades, and accomplishment of free and independent people associating together for a common cause. This is a genuine achievement without which other positive developments could not have taken places. So first I congratulate you on your security miracle.

South Korea's Economic Miracle
The strength of a country cannot be measured simply in military terms. Military capability is heavily dependent on a strong economy, not just an economy able to produce or purchase military equipment, but an economy capable of supporting and expanding the standard of living of the people of the country.
  Recently I reviewed the circumstances that existed on the Korean Peninsula back in 1940. At that time what we now call North Korea produced around 80% of the chemical products, 90% of the metallic products, practically all of the bituminous coal and smokeless coal, pig iron, iron ore and lead. The basic resources, in other words, for industrial development were abundant in the North but no in the South.
  Following the war on the Korean Peninsula, South Korea had a period of trial and transition. The country was struggling to get on its feet after the devastation of the war. The United States was able to help with humanitarian aid. But then beginning in the late '50s and '60s, the economy of South Korea moved ahead often at a pace that would be judged as sensational by any standard, including that of the most productive countries in the world.
  The current picture is stunning. With the population of the South now roughly double that in the North, the GNP per capita is about five times that of the North and the real rate of growth, since its recent decline in the North, is infinitely greater in the South. South Korea is therefore able to sustain its military capability to deter aggression while spending around 4% of its gross national product on defense. Whereas North Korea spends about a quarter of its paltry gross national product on its military forces. Where, by comparison, does it leave its people? I have always felt that one of the fundamental comparisons in the Cold War, which eventually determined the outcome, was relative economic performance. Compare not only North and South Korea but, a comparison of special interest to you, East and West Germany. So let us always remember what people can do when they are unshackled.
But the South Korean performance has been special.
  A new phrase has come into international usage -- the four tigers. (personally I like tigers. I went to Princeton University and that is our mascot and I still keep the mascot of the Olympic Games in Korea in an honored place in my home.) But this designation stands for admiration throughout the world for the sustained high rate of growth of the Korean economy. Nowadays I am told there is a sense of unease in South Korea about the economy. No doubt that is a healthy sign. You continually question and work to do the best you possible can. But you are concerned about a rate of real growth around 7.5%, with the rate of inflation around 7% or so, and average real wages that have doubled in the past five years. It says something very positive about your aspirations that this level of economic performance, although envied throughout the world, is not judged satisfactory here.
  Why has this come about? You have had strong leadership from creative and innovative businessmen and your government has produced an environment that has been helpful to the pursuit of liberalization of your economy, the opportunity for people who have ideas and energy and are willing to believe in themselves to move ahead on their own initiative. Your strategy going back to the 1960s has been to project yourself into international trade. This strategy depends upon your ability to be competitive on the world market. South Korean businessmen and South Korean workers have proven themselves in this most demanding competitive environment.
  I notice that you resist, and perhaps resent, efforts, largely coming from my country, to persuade you to remove barriers to entry of American goods and goods from other countries around the world. I know this looks like a threat to certain industries. Nevertheless, South Korean business has proven itself on the world market. As I would judge it, your consumers can only gain by broad access to that world market, and your own ability to compete at home as well as abroad is formidable. You can build on your undoubted strength a special role in the dynamic economy of the Asia-Pacific region. As you become a more and more hospitable place to do business and a more and more attractive place for the investment of capital, you will be rewarded well, as you have been by your capacity to export into world markets
  So I conclude from your sustained performance that the word for your performance in economic terms is appropriately the word "miracle"
Economics and Politics Go Together
  There was a time when the profession in which I was trained, economics, went by another label, political economy. The more I have worked in various Cabinet posts in the United States and been responsible for some part of the management of economic policy in my country, the more I have worked as a businessman in the global economic environment, the more I have thought about my experiences as well as my academic training, the more I have come to feel that the right word is the one used a century ago, political economy.
  An open economy produces people who want to be able to express an opinion about political life. They get around the world. They know what is going on. This is particularly true these days when, in an information age, people everywhere can easily know what goes on anywhere else. So economic development leads to demands for political openness. At the same time, proper management of even a dynamic economy, or perhaps especially of a dynamic economy like that of South Korea, that operates in a competitive global marketplace, demands economic policies from the government that sometimes call for discipline and sacrifice. The political capacity to persuade and to enlist people in the country to see the long-run gains to be attained by savings and investment, by being open to competition and to change is an essential ingredient. That is how the political and economic work together.
  President Chun Doo Hwan's pledge to turn over power to an elected successor at the end of his term of office was not easy to keep. The reason for the difficulty was continuing threat to security from the North. Any country that must maintain a constant level of vigilance and must be on guard day and night, will feel a necessity for firm discipline and control. Nevertheless the job of deterring aggression can be done, and in the long-run must be done, in the interests of the people and with their support.
  President Reagan and I agreed that the keeping of President Chun Doo Hwan's pledge was essential. We said so to him and, in a manner, that made our views evident throughout your country. Of course, it was not up to the United States to decide such issues, but as your friend, I am sure that our view had some weight. Your struggle has been intense, often marked by violent protest disappeared. The idea of democracy is to settle differences through argument, debate, compromise and, in the end, votes. I remember coming to Korea in the spring of 1987, during a tense and troubled period, and making this point. But I also said how essential it was to be on the path of free elections. I caught a lot of criticism from both sides of the political spectrum for those comments but I stand by them.
  You are more knowledgeable scholars of developments in your country than I could be ever be, but, to me, a turning point came on June 29, 1987. That was the day when President Roh Tae Woo, then a candidate for the presidency, announced his ideas for sweeping democratic reform. Most particularly, he advocated direct election of the president, thereby taking the selection our of the hands of the National Assembly and putting it directly into the hands of the people. This stunning and courageous move even received the praise, though somewhat grudging, of his political opponents. The main point, however, is that when the time came in February 1998 power passed to a democratically elected president of Korea.
  Another miracle had come to pass in your country : the political miracle of democracy. Your achievement was recognized around the world, and in October 1988 President Roh Tae Woo became the first Korean leader to address the United Nations General Assembly, an appearance made at the invitation of the majority of the members. And this measure of recognition was extended in September 1991 when South Korea, along with North Korea, was admitted to the United Nations, a step you and we had long advocated.
  We all know that democracy is not a solution to problems but a way of working on them. And so you continue to work on your problems and work on the further evolution and development of your democracy. Once again you are engaged in the process of choosing a new president to lead your country. As this happens for a second time, confidence grows that there will be a third and a fourth and of the deepening establishment of your democratic miracle.
A Diplomatic Miracle in the making
  I had the privilege last July of attending the Olympic Games in Barcelona which I might say our continuing tribute to the idea of the games and to the leader, Mr. Samaranch. They did a wonderful job there and the games were a great success. I heard many comments from Barcelonians, as well as others, about how much those games benefited from the example of the Olympic Games in Korea. You had set a high standard and drew countries from throughout the world. More counties came to the Olympic Games in South Korea than had ever before taken part. I had the privilege of visiting the Olympic site two times before the games began and of participating in your effort to plan for the games and to see that everything possible was done to ensure their success. The purpose of the Seoul Peace Prize is consistent with the spirit of the 1988 Seoul Olympic Games
  You took a chance in bringing the games to South Korea. The chance was not whether you could do the job or whether your country could stand the scrutiny of people from throughout the globe, but whether the games would be disrupted by North Korea that had shown itself capable of vicious acts of terrorism.
  I remember November 29, 1987, Korean Airlines Flight 858 exploded between Abu Dhabi and Bangkok, on its way to Seoul. Almost all of the 115 people who died were Koreans. On January 15, 1988, a female North Korean agent confessed to planting a bomb on the plane. The purpose : to disrupt the 1988 Olympics. So it was no idle to worry about security. I remember also on dramatic moment as we talked to the Soviets, not only about their attendance at the games, but also about the importance of security. I had spent the morning with the Soviet Foreign Minister Eduard Shevardnadze and brought him to the White House for lunch. The President and I steered the conversation to the question of the Olympic Games and their security. Foreign Minister Shevardnadze had obviously thought the matter over carefully. He stated. "Do not worry. We [the Soviet Union] will be there. There will not be any terrorism." He knew that Ronald Reagan and I expected the Soviets would deliver on that pledge. The games took place without any security problem. You saw to it that a strong deterrent capability was in place.
  The Olympic Games in South Korea were not only a great sporting event but also a great diplomatic event. Certainly a key problem in South Korea's struggle with the North has been the support of the North by the tow large communist powers. Both those countries came to the games. Their government officials, their athletes, and, by television, their people could see for themselves the great accomplishments of South Korea. Since their officials knew North Korea wee, they could easily make comparisons simply from what their own eyes told them. When you consider that the foreign trade of South Korea is roughly 35 times that of North Korea, you do not have to be a genius to figure our which country would be the most worthwhile trading partner.
  You and President Roh Tae Woo managed the games and the contacts they afforded you with great skill. You nourished your contacts with the Soviet Union. I can recall vividly the first meeting between President Roh Tae Woo achieved a stunning diplomatic impact on the North.
  China also was exposed to South Korea during the Olympics. Skillfully you developed your economic relations with China, showing patience with Chinese sensitivities and letting them know that you were prepared for diplomatic relations but you were not desperate to have them. And now President Roh Tae Woo has achieved another diplomatic coup in the emergence of diplomatic relations between South Korea and the People's Republic of China. South Korea now has diplomatic relations with all points on the diplomatic compass. The North is now isolated -- a condition, I believe, that we should change at the appropriate moment and in an appropriate way after careful consultation.
  I should add that there is another place in this region that has, like South Korea, produced three miracles in security, in economic, and in political terms. The people of Taiwan have performed in a manner that draws respect and admiration. Like the United States, South Korea has seen the importance of having diplomatic relations with the People's Republic of China. There is a cost but I believe it behooves us all to try to minimize that cost and to maintain strong and friendly relations with the people of Taiwan.
  All of these moves on the diplomatic chessboard -- the development of your own undoubted capacity to deter aggression, to sustain a strong and dynamic economy, and to develop a political system that engages the South Korean people and draws their votes and their support -- all this formed the background for the emerging dialogue you are promoting with the North. It is not for me to comment on the tactics of this dialogue. I do observe, however, that it moves forward, sometimes strongly, sometimes with, hesitation. You in South Korea, as we in the United States, look with concern at the efforts in the North to develop a nuclear capability. It is the better part of wisdom to insist that nuclear facilities be open and subject to careful inspection.
  All of this leads to a fourth miracle, a miracle in the making. Now we can even see a time when tension on the Korean Peninsula will be greatly reduced. The DMZ itself may become less and less a barrier between people and more a place for passage, as friendships and family associations from the past are renewed. When that day comes, and it will, then there will be a need for creative and imaginative work : to bring people together, to provide opportunity in the North to benefit from the economic and political miracles that have been brought to pass in the South. Creative people will be needed. I have no doubt that such people can be found. Hard work will be called for and Koreans will be able to sustain the necessary effort. But now is the time to be thinking and planning to transform a fourth, a diplomatic miracle into a fifth : a free and prosperous Korean Peninsula.
My Salute
  So, Mr. President, ladies and gentleman, you have honored me with this great award and I accept it with humility and pride. My humility comes from my recognition of the great achievements that have made South Korea the land of miracles. My pride comes from the fact that, through this award, you have allowed me to be associated with you in these miracles. I salute you for what you have done and I thank you for making me a part of your magnificent achievements.