ID :
202223
Fri, 08/19/2011 - 02:35
Auther :
Shortlink :
https://oananews.org//node/202223
The shortlink copeid
Chaebol's undue clout
Chaebol, or family-run conglomerates, have long served as a locomotive for the Korean economy. However, they have also come under severe criticism for amassing wealth through unfair and illicit business practices. Disappointingly, they have often been synonymous with crony capitalism, corruption, greed, tax evasion, slush funds and illegal political donations.
More worrisome is that South Korea has become more dependent on a small number of business giants. The nation???s top 10 conglomerates recorded 756 trillion won ($704 billion) in combined sales of goods in 2010, an 83.5-percent surge from 2005. The sum accounted for 41.1 percent of the total sales of the entire manufacturing sector, hitting a record high.
The figures demonstrated that chaebol???s overexpansion has accelerated the concentration of economic power. They wield ever-greater economic clout, deepening a social polarization between the rich and poor.
This is not to say that chaebol are evil. The conglomerates have made it possible for the country to achieve brilliant economic development in a short period of time. But now, they have to change in order to meet rapid social transformations and live up to growing public expectations for their new role in the 21st century.
The excessive reliance on chaebol could increase the nation???s exposure to risks, especially in times of a global economic and financial crisis. Even the pro-business, conservative Lee Myung-bak administration has called on chaebol to refrain from expanding its business irresponsibly, urging them to adopt a win-win strategy of coexistence with smaller firms.
In his Aug. 15 Liberation Day speech, Lee proposed an ???ecosystemic development??? model, stressing greater corporate social responsibility, ethical business management and co-prosperity. But such a proposal sounds hollow as it lacks concrete steps. Lee and his policymakers must admit that they have talked too much while doing little to usher in a fair society.
Empty slogans cannot bring about change. Chaebol have been increasingly unbridled since the 2005 abolishment of a regulation banning big companies from making inroads into sectors earmarked for small- and medium-sized firms. In 2009, the government also lifted another regulation limiting chaebol???s investment in subsidiaries. Policymakers need to consider undoing the deregulation to check recalcitrant conglomerates.
Lawmakers should realize that chaebol-bashing will not solve the problem. At a public hearing at the National Assembly Wednesday, both governing and opposition legislators lambasted Huh Chang-soo, chairman of the Federation of Korean Industries, and other business leaders for unfair practices.
We urge legislators to enact laws to block chaebol???s overexpansion, promote economic decentralization and ensure a fair share of the economic pie. It is also necessary to enforce the fair trade law strictly to combat internal trading, illegal wealth and management transfer, and other wrongdoings by greedy and unabashed corporations. Let???s remove the chaebol of their winner-take-all mindset.
More worrisome is that South Korea has become more dependent on a small number of business giants. The nation???s top 10 conglomerates recorded 756 trillion won ($704 billion) in combined sales of goods in 2010, an 83.5-percent surge from 2005. The sum accounted for 41.1 percent of the total sales of the entire manufacturing sector, hitting a record high.
The figures demonstrated that chaebol???s overexpansion has accelerated the concentration of economic power. They wield ever-greater economic clout, deepening a social polarization between the rich and poor.
This is not to say that chaebol are evil. The conglomerates have made it possible for the country to achieve brilliant economic development in a short period of time. But now, they have to change in order to meet rapid social transformations and live up to growing public expectations for their new role in the 21st century.
The excessive reliance on chaebol could increase the nation???s exposure to risks, especially in times of a global economic and financial crisis. Even the pro-business, conservative Lee Myung-bak administration has called on chaebol to refrain from expanding its business irresponsibly, urging them to adopt a win-win strategy of coexistence with smaller firms.
In his Aug. 15 Liberation Day speech, Lee proposed an ???ecosystemic development??? model, stressing greater corporate social responsibility, ethical business management and co-prosperity. But such a proposal sounds hollow as it lacks concrete steps. Lee and his policymakers must admit that they have talked too much while doing little to usher in a fair society.
Empty slogans cannot bring about change. Chaebol have been increasingly unbridled since the 2005 abolishment of a regulation banning big companies from making inroads into sectors earmarked for small- and medium-sized firms. In 2009, the government also lifted another regulation limiting chaebol???s investment in subsidiaries. Policymakers need to consider undoing the deregulation to check recalcitrant conglomerates.
Lawmakers should realize that chaebol-bashing will not solve the problem. At a public hearing at the National Assembly Wednesday, both governing and opposition legislators lambasted Huh Chang-soo, chairman of the Federation of Korean Industries, and other business leaders for unfair practices.
We urge legislators to enact laws to block chaebol???s overexpansion, promote economic decentralization and ensure a fair share of the economic pie. It is also necessary to enforce the fair trade law strictly to combat internal trading, illegal wealth and management transfer, and other wrongdoings by greedy and unabashed corporations. Let???s remove the chaebol of their winner-take-all mindset.
