These days you hear a lot about "mutual prosperity" in relation to conglomerates and mid-sized companies. That in itself is at least a good thing. Starting this year conglomerates have been announcing plans to support mid-sized companies, and last month the Fair Trade Commission (FTC) produced measures for dealing with unfair trade practices between the two sides. At Cheong Wa Dae on Monday, president Roh Moo Hyun met with the heads of the country's four major conglomerates and executives representing mid-sized companies to discuss ways for mutual cooperation. They agreed to pursue ways to, among many other things, share the fruits of that cooperation. Hearing pledges from the conglomerate leaders, the president said he would review what had taken place by the end of the end of the year.
The Democratic Labor Party (DLP) held a "Debate on Eradicating Unfair Trade Practices Towards Subcontractors" and has published a white paper describing case examples. It notes that mid-sized companies resent the high-handed treatment they receive from conglomerates, such as unilateral decisions about unit costs. Even without that white paper, no one is unaware of the fact that the abuses of the conglomerates towards their suppliers has long been a problem of the country's jaebeol-centered economic structure.
Actually, having the president call in jaebeol tycoons for a meeting in which he makes requests of them and receives promises does not really look so good. Animosities could arise and cause the opposite of the desired effect, and even if effective the country has seen endless instances where it all just ended as a ritual of going through the motions.
Still, one wants to find hope in the meeting because it means the issue the relationship between conglomerates and mid-sized companies has become a topic of discussion as far as the Korean economy is concerned, and because the mood was different as jaebeol tycoons repeatedly commented on the issue. It is unusual to have the president and the tycoons discussing the issue specifically. Yet again, however, what is important is that there are results and not just a glamorous event and party full of talk. It will be hard for the unfair trade practices to change unless there is a change of thinking, one that understands that conglomerates, too, will have a hard time achieving growth unless there are sturdy subcontractors. And so again we must call upon jaebeol tycoons to ask that they put their words to action in the way of real results.
The Hankyoreh, 17 May 2005.
[Translations by Seoul Selection (EIP)]
[Editorial] Take Real Action on ‘Mutual Prosperity’ |
