Invisible Hands Behind
Lately the analysis is gaining ground that Japan was behind a Financial Times (FT) story which said, "Currency manipulation countries are South Korea and Taiwan." The Nihon Keizai Shimbun Newspaper in Japan is a major shareholder of the FT. It is said that as US President Donald Trump pointed out that Japan was a currency manipulation country, the FT made an attempt to make him pay attention to South Korea. Japan unilaterally put on hold negotiations over currency swaps between Korea and Japan last month. Japan is bent on shaking and taking down Korea such as clearly expressing that Dokdo Island in the East Sea belongs to Japan in teaching manuals for teachers at elementary and middle schools in Japan on February 14.
"Given the fact that the owner of FT is the Japan Nihon Keizai Shimbun, I feel that the FT intended to move the brunt of Trump’s measurement against currency manipulation countries to South Korea from Japan," said a researcher who wanted to remain anonymous at a state-run research center in South Korea. "Japan on the hot seat may have touched South Korea as President Trump plainly expressed his dissatisfaction, saying that the US did nothing when Japan manipulated its currency and a subsequent summit meeting between the US and Japan bore no tangible fruits.
Earlier on February 13, "Apparent currency manipulators are not Japan and China but South Korea and Taiwan, and in some aspects, Singapore" claimed the FT in a story from Tokyo entitled "Trump's fury against Asian currency manipulators set wrong targets." In particular, the FT report mainly targeted South Korea. Even though the proportions of current account surpluses in the GDPs of Taiwan and Singapore were 15 percent and 19 percent, respectively, higher than that of South Korea (8 percent), the paper mentioned South Korea as a currency manipulator ahead of others. The story quoted a foreign currency trader as saying, "South Korea and Taiwan seem to be taking actions in advance to dodge Trump's brunt" in a bid to carp at Korea and Taiwan. It means that the exchange rates have been manipulated by the two countries for several years and as Trump took office, the two countries temporarily stopped intervening in their foreign exchange markets.
In connection to this, a similar concern was raised before. "It will be difficult for the FT to carry positive stories about South Korea in the future," said a senior official at the Bank of Korea at the time of the Nihon Keizai Shimbun's takeover of the FT in 2015. “The FT has a strong global influence. I am concerned that the FT will negatively impact the Korean economy such as foreign investment in Korea,” the official said.
In fact, "The Bank of Korea suggested that the central bank will not further intervene in the foreign currency market to defend foreign exchange rates," the FT reported on the basis of an interview with Park Seung, then governor of the BOK in 2005. This report fluctuated foreign investment funds, making the won-dollar exchange rate plunge.
Japan has a long history of shaking the Korean economy to make it totter. In 1997, when Korea suffered a financial meltdown, Korea’s financial authorities asked their Japanese counterparts to give some help to Korea, saying, "A friend in need is a friend indeed.” But Japan withdrew funds from the Korean financial market, directly causing Corporate Korea to fall victim to the massive financial crisis.