ROK Government Unveils 5.9 Trillion Won Stimulus Measures

Posted on September 23, 2012 by Tom Coyner

Coyner’s Comment:

Desperate measures for near-desperate times. China is not the only one that manipulates its currency. The US, South Korea and others do the same. How fairly each country does so is largely in the eye of the beholder and longer-term economic/political considerations. But below you have it in terms of current ROK economic policy and action.

Government Unveils 5.9 Trillion Won Stimulus Measures
Samsung Economic Research Institute
Sept. 17, 2012

For complete report, click here.

The Ministry of Strategy and Finance announced on September 10 a new stimulus package in an effort to revitalize the lackluster domestic economy. The ministry said that it will provide a total of 5.9 trillion won worth of fiscal support; 4.6 trillion won for this year and 1.3 trillion won for next year. This move came after the government’s announcement in June to inject 8.5 trillion won for the second half of 2012.

Currently, the Korean economy is facing weak domestic demand and exports amid the prolonged eurozone debt crisis and global economic slowdown. Furthermore, business and consumer sentiment are decelerating at a faster pace than the actual reality of the domestic economy. It is also worrisome that the country’s real estate market has hardly recovered from the long stagnation.

Above all, the additional fiscal support can be characterized by tax cut policies. According to a report released by the Ministry of Strategy and Finance, the government will slash real estate acquisition taxes by 50% for home purchases for the rest of this year and will exempt capital gain taxes for unsold houses for five years. Under the plan, individual consumption taxes on large home appliances such as TVs and automobiles will be lowered 1.5 percentage points. In addition, withholding taxes for earned income will be cut by 10% on monthly average to boost disposable income of wage earners.

The government also came up with measures to boost investment. According to the government plan, the private sector will be encouraged to expand its investment in social infrastructure projects, and the government’s investment in state-owned companies will also increase. The government will also provide stronger support for small and medium-sized enterprises and venture businesses by increasing the amount of venture capital to be financed for them.

Meanwhile, the government is planning to spend 400 billion won on facilitating the relocation of major government organizations to provincial cities. Furthermore, it will increase local government budget spending by 1.6 percentage points compared to the previous year. The new stimulus package also includes measures to enhance the social security net for low income families. The government said that it will increase the number of families who are eligible for emergency social security benefits provided by the government and increase financial support for employers so that they can maintain business and hire more workers.

“We came up with these measures to improve the shrinking consumer and business sentiment and boost growth momentum. This time, we tried to harness every possible fiscal and administrative option and focused on areas where the effect can be materialized within this year,” the Ministry of Strategy and Finance said. In the meantime, some critics say that the measures could be only stopgaps in helping revitalize the economy. Some voice concerns that the additional stimulus package could prevent the government from achieving a balanced budget next year due to increased expenditures and decreased tax revenue.

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EUCCK votes to pack bags

Posted on September 10, 2012 by Tom Coyner

Coyner’s Comment:

This has not been a good year for foreign chambers of commerce in Korea – particularly for their executive employees.

This spring the Korea German Chamber of Commerce & Industry conducted a forensic self audit and found its senior executive employee had been regularly using moneys for his personal use without prior approval of the president and board. That led to that employee’s immediate dismissal.

The Korea European Union Chamber of Commerce, often regarded as being more of a private consulting company in that it did absolutely nothing without charging a fee, not to mention the irregularities in not paying value added tax on its magazine advertising, found itself in such tax difficulties for itself and for its top executives’ personal taxes that it had no choice but to shut down.

Abusing metaphors, there may be other shoes to drop, given the overall environment. The long unspoken suspicion among long-term business professionals in Korea has been that the larger and wealthier chambers have been corrupt as they have developed increased budgets with insufficient oversight and disregard of their own constitutions when it come to financial transparency.

Huge amounts of membership fees have been collected, executive employees’ total compensations have met and often surpassed those of their largest member representative directors’ levels, and what one may call “interesting” expenditures have been made annually to lobbyists – all without transparent accounting to their members.

This situation has continued since the chambers roles, while important, have been in the overall context much less significant than what they claim to be for their members. Consequently, for good reason, when individual expatriate members eventually start putting “one and one together,” the rational conclusions have been not to blow the whistle, since risking the political blowbacks have not been worth it, and in a few months, the newly aware executives would be transferred out of Korea. So none have been motivated to shake their hornet nests.

What changed this year has been a major personality clash between an elected president and his executive employee and the Korean tax authorities deciding to look into the finances of a chamber. I have no idea if there have been any whistleblowers involved, and if there were, I have no idea what may have been their motivations. But the first two shoes have fallen – and dramatically.

So, how may this phenomenon be prevented? I have two or three simple suggestions:

First, the chambers of commerce need get out their constitutions, take long hard looks and enact their articles in terms of the letter and intent, with a special concern on financial transparency to the memberships. The glossing over annual public statements of accounts has been providing too much cover for both real and imagined shenanigans.

Second, develop and maintain proper relationships between the elected presidents and the hired executive managers that is cooperative and yet not too buddy-buddy, along the wink, wink, nudge, nudge variety. These cordial relationships must also serve as check-and-balance functions and not allowed to be perceived as possible partners-in-crime fellowships.

Third, the boards of directors should consider conducting discreet forensic audits. Yes, there are annual audits being conducted, but one wonders about the auditors’ distance from those he or she is auditing and whether the past audits’ criteria have been sufficient. In the case of the German and European chambers, proper, preemptive audits would have prevented much of what has happened this year. The other chambers could well be sitting on their own time bombs.

European chamber exiting Korea in wake of tax fine
과징금 부과 한 번에… 주한EU상의 문 닫는다
By Park Hyun-young, Joo Kyung-don
Korea JoongAng Daily
Sept 08, 2012

Click here to read article

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Japan, China and their ‘history problem’

Posted on September 10, 2012 by Tom Coyner

Coyner’s Comment:

The below essay is much more encompassing than my op-ed piece earlier this week calling for the Japanese emperor to apologize to the rest of Asia, if only for the Japanese own sake. But the two essays are complimentary. As the below article states, unlike Germany, the official head of the Japanese state remained seated, though MacArthur had the option to remove Emperor Hirohito. Furthermore, much of the government officials remained in power, even if a handful had to do short stints in prison before resuming their duties.

But as this essay points out, no one country is to blame. As concisely stated in the below piece’s conclusion, Japan left Asia 150 years ago and did its best to be the “honorary white men” of Asia so that even today Japanese often naively set their fellow Asians’ nerves on edge when referring to Asia as something separate from themselves.

The Chinese foolishly squandered their cultural, political and military supremacy just at the time Western colonialism came floating upon its shores. And the Koreans, as a vassal state, did not do any better than China, leaving itself relatively weak and dependent on a destabilized China.

Given that all three nations have their own peculiar mixtures of nationalism that hide various kinds of sensitivities – often based on a failing senses of self confidence in the greater global context, the three nations are too ready to act out their insecurities by picking quarrels with their equally insecure neighbors.

At any given time, one of the three nations have or will temporarily try to rule the NE Asian roost. (Korea is the exception, but one may argue it has not more out of geopolitical weakness than political virtue. But one cannot say the Koreans will always remain so virtuous in the coming centuries.) Once upon a time it was Japan, and now China is trying to push Japan aside. Again, the Koreans pretend to act virtuous, but must act as such given their nation’s north-south division. At the same time, the Koreans have ongoing territorial and historical disputes with the other two nations.

Into this fray stand the US under the guise of Pax America with two of its strongest allies anywhere in the world constantly squabbling. Yet all three – Japan, South Korea and the US – can only benefit by better acting out a fully implemented tri-party solidarity vis-à-vis China – particularly when it comes to maritime disputes. But that is the ideal and the below essays summaries the current and foreseeable realities.

One may suppose that in the end all of this acts to China’s advantage. But China has more than its share of domestic challenges that conceivably could lead to China imploding into competing Sino states as has happened so often in China’s long history.

The good news is that many more people have much more to gain from a relatively peaceful NE Asia than any prolonged armed conflict’s likely success. Nonetheless, these long-held historical tensions make this part of the world much more volatile than many casual observers may assume. As such, it is critical for both professionals in both public and private sectors to be aware of these pressures and prepare, when possible, accordingly.

By David Pilling
Financial Times
August 22, 2012


Click here to read article

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Japan needs emperor to apologize

Posted on September 10, 2012 by Tom Coyner

Most Japanese are shocked when they realize the latent antipathy the rest of Asia still holds toward them.

by Tom Coyner
Korea JoongAng Daily
August 21, 2012

President Lee Myung-bak’s recent demand that the Japanese emperor formally apologize prior to a future visit has been considered belligerent by vocal Japanese commentators. And yet the emperor needs to stand up and do the right thing, if only for the overall welfare of the Japanese.

While Japanese right-wing extremists often attract media attention, most Japanese are eager to put Japan’s differences with its neighbors behind them. In fact, most Japanese are shocked when they realize the latent antipathy the rest of Asia still holds toward them. This shock comes from most Japanese possessing friendly sentiments toward the world in general and towards Asia in particular.

I have repeatedly witnessed Japanese individuals and groups sincerely express their remorse on behalf of their country to Koreans – even if they were born after World War II. Last week, some 1200 Japanese women publicly apologized for Japan’s past sexual slavery.

While most Japanese may not feel compelled to make overt apologies to Koreans or anyone else, I dare say most are willing to put a past generation’s sins behind them, even if it means that someone of authority displays the courage to stand up and do the right thing.

There is a precedent. The current emperor’s father broke ranks in 1945 and asked the Japanese people to “bear the unbearable” in accepting defeat. Shortly after MacArthur arrived in Tokyo, Hirohito presented himself to the American general-in-chief, taking full personal responsibility for all that Japan had done.

Asking his son to do something less courageous is not out of line. I suspect that he may be willing to do such a thing. Though the emperor is officially the head of Shinto, he was tutored and greatly influenced by two Quaker women after World War II, most notably by Elizabeth Gray Vining with whom he emotionally bonded. The present emperor has been greatly influenced by Western and even pacifist values that place a premium on understanding and respecting others different than oneself.

So, given all of this, one may ask what the hold up has been after all these years? The problem has not been with the average Japanese. Even Tokyo politicians are not truly liable. The problem is with a small number of people who work in the national ministries.

Japan’s modern-day mandarins possess all the group arrogance of their 19th century Chinese counterparts. Their primary concern is not for the overall welfare of Japan but their own insular and elitist well-being.

To be fair, this group is really not all that out of keeping with the rest of the country.

Contrary to Japan’s highly valued wa, or social harmony, the society actually consists of highly competitive power groups, often denominated by university affiliation and professional organization. At the top is the Tokyo University/Ministry of Foreign Affairs faction or batsu, consisting of the very best university graduates. As much as this group goes through the motions of taking care of the “little people,” their primary mission is to serve and protect their own interests. That includes honoring and protecting their seniors or sempai, who have served before them – including those who made up the Japanese Government during the 1930s and 1940s.

Japanese politicians, including prime ministers, dare not go against the Ministry of Foreign Affairs, given their wide-ranging political influence in Japan’s public and private sectors. Formal statements, including equivocating “apologies” must first be vetted by the ministry.

And to date, no statement has even implied dishonor on prior, now long-deceased government leaders, including senior bureaucrats. To do so would potentially weaken the elitism of these government officials and potentially set a precedent that may hold them accountable in the future.

Given this context, a small number of bureaucrats are holding back better relations with Japan’s neighbors. And today, given China’s rising hegemonic power, Korea and Japan can ill afford squabbling over historical matters when they have much more to gain in cooperating more closely.

What is needed is for Emperor Akihito, as head of state, to stand above the cynical concerns of an elite few and do what is right and best for the Japanese people. He needs to make a short and sincere apology to the victims of World War II once and for all, and then step down to resume his low profile duties. Only he can unilaterally take this action. His father displayed greater personal courage in 1945. Can the present emperor do even less today?


* The author is president of Soft Landing Korea, a business development firm, and an alliance partner of Odgers Berndtson Japan.

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Gangnam Style, Dissected: The Subversive Message Within South Korea’s Music Video Sensation

Posted on September 10, 2012 by Tom Coyner

Coyner’s Comment:

To paraphrase an old saying, “You can always tell a Gangnam-styled young person – but not very much,” since they listen only to their own narrow crowd.

While we can rationalize why the below-described kind of satire has been so slow in the coming, given Korean society’s shallow history of subtle humor, it is nonetheless long overdue. The Gangnam elite of today make America’s Valley Girls of the 1980s look like serious philosophers in comparison.

One can attempt to explain why this is so. Perhaps one may hypothesize that Koreans are still insecure in their social ranking in their modern, neo-Confucian society so that form over substance still overwhelmingly rules in many aspects of life. So it comes as no surprise that the young nouveau riche and the wanna-be nouveau riche go to extraordinary lengths to fake it in hopes of fooling enough people into believing that they, too, belong to a make-believe elite that self defines its collective place in society.

Fortunately, for those people better anchored in the real world, one can overlook much of this nonsense. Still, unexpectedly one does bump into these great pretenders in social gatherings. When these encounters are not mildly infuriating, they can actually be comical. But it’s all part of the fun of living in Korea.

By Max Fisher
The Atlantic
August 23, 2012

Click here to read article and view video

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Asia’s near impossible reversals

Posted on September 10, 2012 by Tom Coyner

These master-follower relationships make it remarkably difficult for a master, such as Kim Young-hwan, to do a 180, given his obligations.

by Tom Coyner
Korea JoongAng Daily
Aug 30,2012

http://koreajoongangdaily.joinsmsn.com/news/article/article.aspx?aid=2958619

As an American who has spent half my life in Northeast Asia, it has taken me some time to get my head around why we see so many more graying radicals on the left and the right in this part of the world than we see in the West.

Last week, I was reminded about this widespread political phenomenon while reading an article about Kim Young-hwan in this paper’s companion, the International Herald Tribune. Kim Young-hwan was an iconic student leader of the 1980s who essentially embraced the juche, or self-reliance, ideology. He jumped at the opportunity to secretly visit North Korea, where he met Kim Il Sung. What should have been the highlight of the trip unexpectedly turned out to be the nadir. What the student leader encountered was an old dictator remarkably unfamiliar with a political philosophy purported to summarize his wisdom.

Disillusioned, young Kim returned to South Korea. Unlike a number of leftists who have visited North Korea and simply come back home greatly disappointed, Kim Young-hwan has publicly repudiated his earlier politics and actively criticized the North. If he had been a prominent American making a similar reversal, this would not have been quite so remarkable. But as a Korean, he has done what many would consider to be unthinkable.

Given that this is a South Korean presidential election year, that article had some additional important, if latent, meanings for observers of Korean politics.

Westerners may scratch their heads as South Korean leftists continue to act as unabashed apologists for the Pyongyang rulers given the plethora of evidence that has steadily arrived in Seoul from many sources over the past years. The previously referenced newspaper article gave some insight in that most of South Korean leftists have never been to North Korea.

But there is another, perhaps even greater, factor at play that is not unique to Korea, but one many say is endemic to various societies in this part of the world. That is the vast and interlocking webs of seonbei-hubei (or in Japanese, sempai-kohai) relationships. These master-follower relationships make it remarkably difficult for a master, such as Kim Young-hwan, to do a 180 given his obligations – political, psychological, social and otherwise – to his followers. The fact that he reversed himself – and kept active in politics – is simply incredible.

It takes real guts and tremendous gumption to make a flip-flop like this in East Asian culture. Normally, the aftermath of this kind of reversal is a loss of face for the entire group and often has much worse consequences for the master.

So one can imagine the thousands of hangers-on associated with far left legislators and political activists in South Korea. When they eventually realize they have made a gigantic wrong turn, many have – or will – opt to quietly drop out of sight. Others, such as professional politicians, usually do not have that option. They must go blindly forward, hoping against all the evidence that they may somehow eventually be proven right. In their wake trail their “true believer” followers. And over time, many of these followers develop their own cadres of followers.

This is the very dangerous flipside to the many positive attributes of the Asian master-follower relationship. When the relationship is based on virtue and reality or whatever constructive paradigm, these relationships can be extremely valuable to both society and the directly concerned individuals.

However, even when such relationships are discovered to be essentially anchored to lies and ignorance, it is nearly impossible to change if the relationships have become established over the past decade or more. The concerned parties are pitifully roped into fallacies that most East Asians cannot expect to escape. All they can do, such as with South Korean leftists, is to gather for drinks and ineffectually sing revolutionary songs, pretending they are protectors of an imaginary flame.

It’s all very sad – and it is also much more common than many folks care to recognize, on both the left and the right.

But more importantly, this kind of social inflexibility can have a significant impact on the political process. All of this makes it particularly difficult for East Asian societies to have responsibly functioning democracies. The fact that South Korea probably has the best operating democracy in this part of the world is a real achievement given the cultural foundation.

* The author is president of Soft Landing Korea, a business development firm, and an alliance partner of Odgers Berndtson Japan, a global “Big Six” executive recruitment consulting company.

Posted in Coyner's Op-Ed Essays, Doing Business in Korea, Human Resources, Japan, Management, North Korea, Society | Tagged , , , , , , , , , | Leave a comment

After Verdict, Assessing the Samsung Strategy in South Korea

Posted on September 10, 2012 by Tom Coyner

Coyner’s Comment:

Observers on both side of the Pacific are trying to digest the back-to-back Apple vs. Samsung court decisions. Almost immediately, everyone seems to have forgotten the Seoul judicial decision that ruled both companies had infringed on each other’s intellectual property, with Apple infringing more on Samsung’s IP than vice-versa. The US $1.1 billion initial award judgment has overshadowed everything. It’s telling there is now almost no mention in the media of the Seoul court’s ruling.

Below are two pieces, both written by Koreans. Pulitzer prize winner Choe Sang-hun attempts to give an even handed assessment and has succeeded in writing one of the best single piece assessments of where things currently stand. The second piece is more of an emotional reaction that is properly placed in an op-ed section of her paper. While the logic and facts can be called into question, the editorialist articulates much of the emotional response of many Koreans about the San Jose court case – including how once again poor Korea is being beaten up by the more powerful USA.

I’m tempted to weigh into this issue in a separate, published piece, but I also realize that the topic is pretty sensitive over here right now. On the other hand, South Korea is much less thin skinned than what it once was and Choe Sang-Hun’s piece is just one example of South Korea’s rapid maturation.

I frankly hope the US ruling and almost certain, near-term follow-up events will collectively serve as a serious wake-up call to Samsung Electronics and other competitors. While imitation may be the sincerest form of flattery, it can run a company into an eventual dead end. Samsung Electronics has shown its innovation in high quality, rapid-response manufacturing. It now must demonstrate the marketing acumen and self confidence to innovate truly niche-creating products. I suspect the company has the talent. The question is whether its conservative management is willing to take the risks similar to an Apple-type company.

By CHOE SANG-HUN
The New York Times
September 2, 2012

Click here to read article

Americans are sore losers

Somewhere down the road, American cars and semiconductors became mediocre and failed to appeal to consumers.
by Sunny Yang
Korea JoongAng Daily
Sept 03, 2012

Click here to read op-ed

Posted in Doing Business in Korea, Marketing, S Korea Economy, Selling, Technology, Trade, USA | Tagged , , , , , , , , , | Leave a comment

Cash is king for worried companies

Posted on September 10, 2012 by Tom Coyner

Coyner’s Comment:

Though this story ran on page 4 of the local newspaper, this may have been the most important piece in today’s edition. Monitoring how these mega-companies are prioritizing their finances gives one as much insight – probably more than reading various consumer and business polls.

Clearly, Korean companies are applying painful lessons learned from the 1997 IMF Crisis when overleveraged companies found overseas loans coming due with a suddenly devaluated won. One can hope they are overreacting, but considering how conservative and yet aggressive these companies perform, this article may serve as a red flag that we all may be in for some hard times during these coming months.

Local firms start selling buildings, their own stock to survive uncertain times
장기불황에 믿을 건… 현금확보 ‘비상’
By Song Su-hyun
Korea JoongAng Daily
Sept 03, 2012

Click here to read article with graphics

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How overblown is the K-Wave?

Posted on September 10, 2012 by Tom Coyner

The Koreans wisely recognized what all of this is all about, which is obviously adolescent sexual drives.

by Tom Coyner
Korea JoongAng Daily
Sept 06,2012

http://koreajoongangdaily.joinsmsn.com/news/article/article.aspx?aid=2958987

For the past five years I have monitored with detached interest how Hallyu, or the Korean Wave has grown from a local pop phenomenon into an international trend. There is no denying it. The Korean Wave is huge. But by living in Korea, one could easily get the impression that the Korean Wave has taken the entire planet by storm and there is no telling where Korean culture will make its next global impact.

But is this really the case?

I know as a fact there is creative team in a major Korean tourism bureaucracy that is divided into two camps. One camp tries to shoehorn the Korean Wave into just about everything they touch. The other camp is about ready to scream if they hear “Hallyu” yet one more time.

And that pretty much sums it up.

Either one believes the entire globe is hooked on the Korean Wave – or one wonders if the frogs in this small pond have yet again falsely projected their importance beyond the horizon. As often is the case, I suspect the truth lies somewhere in between.

Let’s consider what most observers agree is the origins of Korean Wave. One must first look to Japan where ultra kawaii, or cute, boy and girl acts – either as individuals or groups – have dominated the Japanese pop scene for decades.

Over time, the Japanese have worked out a formula that includes recruiting good looking adolescents into talent stables, training them how to sing, dance, posture and interact with live audiences. The music companies then harvest the very best and put these youths out as single artists or into boy or girl bands.

Particularly when choreography is highlighted, the groups have been particularly successful. Noting such, Korean companies have been emulating this highly successful business model that generates large profits not only within Japan but also throughout Asia. But as often is the case, the Koreans have not only emulated but have improved on the template.

The Koreans wisely recognized what all of this is all about, which is obviously adolescent sexual drives. Consequently, cuteness was replaced with sultry sexiness – but not too much. Just what my generation used to call as “prick tease” sexiness. That is, implying but not actually overly suggesting carnality.

If there is anything that hits the primarily Asian target, this Korean fine tuning has to be it. Most Asian adolescents or young adults wish to think of themselves as – and others to think of them as – being sexy. But Asian culture can create major inhibitions.

For example, there is safety in numbers – particularly when acting out mildly outrageous as part of a group than doing essentially the same as an individual. To put it another way, identifying closely with a boy or girl band (think the Beatles) is less intimidating than to do the same with a iconoclastic rebel like Elvis. To choose the latter path places the individual alone into new, unchartered social territory. But to venture out as a group – even if only by psychological connectivity – there is a social security in what I may label as “safe group sex.”

For many young Asians who have never had a genuine, romantic kiss, the Korean Wave’s boy and girl band are undoubtedly attractive. It is not surprising to find the Korean Wave being extraordinarily popular throughout East Asia and as far as the Middle East where implied sexuality is more comfortably welcomed than the blatant, in-your-face sex appeal of Lady Gaga and other Western stars.

Looking to the West as viewed through Korea’s mass media lenses, one would get the impression that Korean Wave is on the verge of inundating the youth markets of all nations. After all, were there not a sellout crowds at Carnegie Hall and similarly successful concerts in London and Paris? The quick and obvious answer is yes. The more thoughtful reply is “yes, but .?.?.”

Having a son who lives in Korea Town in Los Angeles and who is a musician in his own right, I asked him what in blazes is going on in the United States. His street perspective is that the Korean Wave is indeed big, but only in pockets where Koreans and other Asians concentrate. There are non-Asian ethnic American fans as well, but he noted that most non-Asian American Korean Wave fans are very good friends of Koreans and a surprising number have had or currently have ethnic Korean lovers. How accurate is that observation, I have no idea, but it does tie into the sexuality of my other observations.

All of which is fair game when one recalls how early rock ‘n’ roll of the 1950s was strenuously resisted by my parents’ generation who not entirely unfairly pigeon holed “sex, drugs and rock ’n’ roll” into one category.

Even Bob Dylan allowed that the basic beat of rock ‘n’ roll emulates human copulation. But today, given that rock ‘n’ roll is prevalent throughout many societies, one doesn’t give it any more thought than suggestive advertising and gratuitous cinematic love scenes.

What I find a bit humorous is Korean bureaucrats coming up with some pretty bizarre schemes to hijack the Korean Wave as a platform to introduce overseas traditional Korean culture and high tone tourism. It takes genuine self-control not to roll my eyes when I’m asked my opinion – that is, approval – of these naive strategies. I generally give some kind of ambiguous answer. I haven’t figured how to concisely explain to a 60-year-old bureaucrat what is going on in the minds and other body parts of today’s teenagers and twentysomethings have little to do with untapped interest in Korean culture.

Meanwhile, the Korean Wave laps at the shores around the world. Sometimes it overwhelms local pop scenes, but other times it simply competes as novelty acts in other, more sexually explicit markets. In the long run, what the Korean Wave needs is genuine, ongoing innovation. But that is another topic for another time.

* The author is president of Soft Landing Korea, a business development firm, and an alliance partner of Odgers Berndtson Japan, a global Big Six executive recruitment consulting company.

Lessons from K-pop’s Global Success

K-pop has entrenched itself as a bona fide phenomenon in Asia and is rapidly extending its reach to new markets. Companies in other industries can benefit from its success by deploying K-pop based products and tourism packages, using K-pop stars as spokesmen, and piggybacking on K-pop’s transnational appeal. Companies can also learn from K-pop’s system of rigorous training and long-term planning.

SEO Min-Soo
Samsung Economic Research Institute
August 2012

Click here to read analysis

Posted in Coyner's Op-Ed Essays, Doing Business in Korea, Economy, Marketing, S Korea Economy, Society, Trade | Tagged , , , , , , , | Leave a comment

North Korea Updates

Posted on August 11, 2012 by Tom Coyner

Coyner’s Comment:

Is substantial change truly afoot in North Korea? Does anyone really know at this point?

Anyone who claims to have a real handle on what is happening north of the 38th Parallel must be discounted since literally few people in the world seem to have an accurate understanding.

But as professional and amateur North Korea watchers pick through the rumors, something indeed seems to be happening – albeit, we have been wrong in our assumptions about the DPRK too many times to recount.

While I was away from Korea this summer, stories and rumors circulated that the Kim III has stepped away from Military First (Seon-gun) policies and taken back economic controls from the military. There was even a rumor of a fire fight as the military initially resisted this change. The obvious question is whether Kim Jeong-eun has the political and military wherewithal to accomplish anything similar to these rumors at this early stage of his regime.

But if much what we hear is true, an admittedly unreliable straight line analysis may suggest that young Kim could shake up the Korean peninsula in the coming years. As a professional Korean watcher has privately fantasized, Jeong-eun could lose weight, eventually adopt a more modern hairstyle and attire, speak in flawless English and come across as a young, 21st century Korean leaders for both Koreas – accomplishing more with liberated economic policies and diplomacy than his grandfather and father even approximated.

Should such a fantasy be realized, South Korean politicians will be severely challenged. The open question would be as to how much would North Korea be a kinder, gentler entity — as opposed to how much does Pyongyang remain committed to ultimate domination of the peninsula via a completely new set of tactics while allowing the underlying strategy to remain essentially unchanged.

As always, the one thing we can safely assume is that we have some fascinating years ahead of us.

Below are a local news report, an editorial by the Korea JoongAng Daily and an overall assessment by The Economist.

North changing its economic model: Sources
Pyongyang is reportedly allowing people to run businesses, set prices
북한, 경제 개방? 심상치 않은 변화가…
By Lee Young-jong, Kim Hee-jin
Korea JoongAng Daily
Aug 10,2012

Click here to read article.

Riding the positive wave
Local authorities are mixed in their responses to the North Korean leader’s highly publicized moves. Some see them as positive signs for opening, while others are reserved.
by Bae Myung-bok
Korea JoongAng Daily
Aug 10,2012

Click here to read editorial.

Where the sun sinks in the east
With a decrepit economy, and now devastating floods, a closed regime shows signs of greater openness—though not to everyone
The Economist
Aug 11th 2012

Click here to read analysis.

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