In the Ming Dynasty, (1368 – 1644), China established an examination system as a merit-based approach for appointments to government office. There were three levels to the exams, with the final cut then coming through an examination administered by the Emperor himself. The subject matter of the exams was standardized beyond anything we see today. It was based on a limited set of ancient works, stripped of any contemporary additions. The examinations depended exclusively on the memorization of these classics. The exams were administered in a way that assured anonymity. Those reaching the third level wrote in separate cells, the equivalent of modern-day cubicles. After days of writing, they literally threw their papers over a wall, where the writing was copied by a scribe to assure there would be no tell-tale indications of the examinees.
Capital controls are back in fashion. In June 2010, South Korea and Indonesia announced several policy measures to regulate potentially destabilising capital flows, which could pose a threat to their economies and financial systems.
Summary: Every game has an ending. The complex, insane brinksmanship of North Korea might have entered its last chapter (although that’s been predicted often since the fall of the Berlin Wall). Probably not a pretty picture, whenever it happens. Nor will be the early chapters of what follows. Among the effects, consider the cost to South Korea. Probably far higher than that of German unification, perhaps to horrific levels. Some experts have looked ahead; this excerpt gives a good summary of their findings.
The Chinese Ministry of Housing and Urban Development reaffirmed its commitment to enforcing policies preventing speculative real-estate investment. Separately, the China Banking Regulatory Commission also said it made no changes to its policies on home loans. Stocks fell on the news reversing yesterday’s gains fueled by speculation China may be relaxing its tightening measures. (See RGE Critical Issue: Chinese Property Regulations: Backing Away from Austerity?).
The MSCI Asia Pacific index fell 0.3% to 115.76 while the MSCI Asia Apex 50 declined 0.61% to 731.
Just days before the G20 summit in Toronto, South Korea and Indonesia announced several policy measures to regulate potentially destabilising capital flows which could pose a threat to their economies and financial systems.
The policy measures announced by South Korea and Indonesia assume greater significance because both countries are members of the G20 and because South Korea chairs the G20 in 2010.
South Korea imposes comprehensive currency controls
On June 13, 2010, South Korea announced a series of currency controls to protect its economy from external shocks. The new currency controls are much wider in scope than foreign exchange liquidity controls announced earlier in 2009.
The imposition of currency controls by the Korean authorities has to be analyzed against the backdrop of the global financial crisis. Despite its strong economic fundamentals, South Korea witnessed sudden and large capital outflows due to deleveraging during the global financial crisis. It has been reported that almost US$65 billion left the country in the five months after the collapse of Lehman Brothers in September 2008.
On March 26, a South Korean warship, the Choenan, sank in the Yellow Sea after a powerful explosion. Though more than one-half of the ship’s sailors were rescued, 46 perished. While the final results of the subsequent investigation by the government and the public and military intelligence agencies are expected to be announced as early as mid-May, South Korea’s defense ministry has confirmed that a powerful explosion outside the warship was the main cause of the incident. Based on the evidence thus far, South Korea and many external media sources have been suspicious about North Korea’s involvement. Critics who strongly believe in the North’s involvement argue that the North wanted to use the Choenan incident as a display of military power to boost global attention prior to returning to the six-party talks. Nevertheless, North Korea has so far strongly denied its involvement and reacted strongly against such suspicions. Even if the investigation reveals that the allegations are true, South Korea’s government would not have many options to respond.