Korea Focus February 2015 by The Korea Foundation

Table of Contents - Korea Focus - February 2015 - Politics 1. Lights and Shadows of the Seven Decades Since Liberation 2. Despite Abe's Policies, Korea-Japan Relations Should Move Forward 3. President and Presidential Secretaries 4. [DEBATE] Dissolution of the United Progressive Party

- Economy 1. Jobs as Ballast Water for the Economy 2. Conditions of an Advanced Nation and Capacity for Surviving Crisis 3. [DEBATE] Are Korea's Regular Workers Overprotected 4. Applaud Purse-opening Rich People 5. What to Study in University to Become a Successful Manager

- Society 1. Keep Our Children from Becoming Islamic Militants 2. Korea's Conglomerates Must Change their Backward Thinking 3. Low Salary and Miseries of the World 4. Elites and the Learned Culprits of Angry Society 5. Getting Out of the Black Hole of Chaos 6. Underdeveloped Society in Handling Sex Crimes

- Culture 1. Olympic Games Shouldn't Leave Koreans Indebted 2. A Tribute to Korean Fathers 3. Time to Ban 'Reckless' Plastic Surgery 4. Quality Tourism for Chinese Visitors 5. Restoration or Destruction

- Essays 1. Korea's Trade Growth and Current Trends 2. Economic and Business Keys of 2015

- Features 1. Traditional Smiths in Modern-day Seoul 2. Chasing Away Prejudice toward Multiculturalism 3. Reclaiming Overseas Cultural Assets Private-Public Discordance Hampers Return of Joseon

Queen's Seal 4. “It's Unfortunate that Korean Treasures are Just Lying in Storage Rooms at Museums Overseas”

- Book Reviews 1. The Sea Completes Silk Road 2. The Secret of Joseon's Success in Foreign Language Education

- Interview 1. Koreans' Germany Fantasy a Little Inflated 2. Takashi Uemura “My Article on Comfort Women was Not Fabricated.”

- COPYRIGHT

- Lights and Shadows of the Seven Decades Since Liberation

- Despite Abe's Policies, Korea-Japan Relations Should Move Forward

- President and Presidential Secretaries

- [DEBATE] Dissolution of the United Progressive Party

Lights and Shadows of the Seven Decades Since Liberation

Leaders of various walks of life call for "peace and reconciliation between the two Koreas in the 70th year since liberation," in a press conference held at the Korea Press Center on January 22.

Kim Byung-joon Professor, Department of Public Administration and Policy Kookmin University

I frequent a noodle restaurant that once housed a newspaper company run by Lyuh Woon-hyung, a prominent Korean independence activist. Around the time the nation was liberated from Japanese colonial rule and subsequently divided into North and South, a good number of our leaders, political and otherwiseminded, gathered there to share their joys and sorrows in trying to build a unified, independent nation. I have often wondered if the house with such historical background should be left as it is. I once asked the restaurant’s owner, “Why don’t you hang something related to Mr. Lyuh, a photocopy of his writing for example, on the wall?” He rejected my suggestion, waving his hand. He said he once had a hard period after his restaurant was shown on television; people thronged it, calling it a “Red’s house.” I gulped down a cup of makgeolli, feeling pity over limitations of our history. “Yes, this is where we are,” I said to myself. With a proud history behind, the nation marks the 70th anniversary of liberation this year. Our per capita national income is now approaching $30,000, with our trade volume ranking ninth in the world, which is truly an unprecedented feat in our 5,000-year history. However, the dazzling records have dark sides as well. The

shadows of our contemporary history do not only involve the problems of the past and present, such as the suppression of human rights and the yawning gap between the rich and the poor, but more fundamental issues that have become a sort of original sin holding us back from advancing to the future. First, we are trapped in confusion of values. While such values as “anticommunism” and “development” were given the foremost emphasis, many other important values were sacrificed, blurring our value system. Under the banner of “anti-communism,” many independence fighters, like Lyuh Woon-hyung, faded away into history on the grounds that they were leftists or anarchists. On the other hand, pro-Japanese figures gained power and their wealth and privileges were passed down to their children. Justice has collapsed and we cannot inform anyone about an honest life. It’s the same with “development.” Everything was condoned in the name of development. Chaebol enjoyed various favors and were pardoned when they committed crimes. In contrast, the rights of workers and ordinary citizens were often suppressed without justifiable reasons. It was inevitable that deciding which was right or wrong became a confusing endeavor. One cannot but worry whether our proud history can be sustained under these circumstances. It is because our society has become an innovation-oriented democracy in which the values of individual citizens determine the healthiness and competitiveness of the state. There is yet another outstanding problem. That is diluted governance capability of the state brought about by authoritarianism. Authoritarianism was regarded as a most effective tool in running a state for some time, but ironically it has substantially weakened the state’s governance capabilities. As a result, confusion has come to sweep across our society, especially messing up the political field and mass producing politicians in two opposing types ― loyal followers of power on one side and dissident opponents on the other. Both groups equally lack the ability to formulate workable policies or alternatives to meet the demands of a new era. With these leaders and their epigones steering the political arena, the already feeble functions of the National Assembly have shrunk endlessly. The situation is no better with the bureaucracy. Under an absolute authoritarianism, bureaucrats worked in such flawless order that they were unable to implement needed reforms. Now, with the absolute power removed, the

bureaucrats have become apathetic about a minefield of warped and twisted regulations and guidelines as well as distorted organizational cultures. Altogether we are laden with dismal politics, an incompetent parliament and an immobile bureaucracy. Under these circumstances, how can we expect to have a respectable president? Even if one is elected, can the president properly perform the duties bestowed? It would be difficult whoever is elected the president. To sum up, all the relevant actors ― from the president and the legislature down to the bureaucracy ― are incapable of perceiving problems and working out solutions. Neither can they handle conflicts. Consequently, the logic of power prevails in our society, with the haves getting even more and the have-nots being deprived of even what little they have. Socioeconomic absurdities such as bipolarization intensify, and friction and cynicism run to extremes. What should we do? Many people are waiting for the Messiah. They hope someone will settle all problems that are engulfing our society. The feverish response of the Korean public to the two recent blockbuster films, “Roaring Currents” [about Admiral Yi Sun-sin defeating Japanese invaders in the 16th century] and “Ode to My Father” [depicting a man’s struggle through the Korean War and the postwar development era] obviously reflects such popular wishes. However, that is not the answer to our question; it would merely complicate further the problems that have derived from authoritarianism. There are two distinct things that we should do. First, we should duly comprehend that our proud history has both bright and dark sides, which created contradictions that we had to accept to reach where we are today. By doing so, we can open our minds toward each other. Next, we ought to deeply reflect and evaluate the contradictions to search for new values and governance structure to usher in a better tomorrow. These are the critical tasks we face in this 70th year since national liberation. [Dong-a Ilbo, January 6, 2015]

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Despite Abe’s Policies, Korea-Japan Relations Should Move Forward

President Park Geun-hye meets U.S. President Barack Obama and Japanese Prime Minister Shinzo Abe at the U.S. ambassador's residence in The Hague, Netherlands, on March 25, 2014.

Lee Won-deog Professor, School of International Area Studies Kookmin University

Shinzo Abe is about to begin his third term as prime minister of Japan. In the snap parliamentary elections held on December 14, Abe’s Liberal Democratic Party (LDP) won 291 seats in the 475-member Lower House. Adding the seats of coalition partner Komeito gives him 326 seats, exceeding a two-thirds majority. Barring any unforeseen circumstances, Abe should be able to remain in power until at least 2018. Initially, Prime Minister Abe’s sudden decision to dissolve the Lower House two years early seemed to lack rhyme or reason, but his timing was superb in terms of his political calculations for extending his tenure. The opposition Democratic Party of Japan (DPJ) was in disarray and not fully prepared to offer a coherent alternative vision even though Abe’s promotion of restarting Japan’s nuclear power reactors, exercising collective self-defense and historical revisionism were opposed by nearly half of all voters. As a result, the LDP’s victory was expected. The DPJ won a paltry 73 seats. Japan has now become the “archipelago of creeping conservatism.” Prime Minister Abe has grabbed the brass ring of one-man rule now that he can

exercise “presidential-like” power. His administration is a strongman surrounded by weaklings. In the election, nuclear power, constitutional revision and history issues failed to resonate with voters. Instead, the only point of contention was Abenomics, including delaying a consumption tax increase. With a record-low turnout of 52 percent, a majority of young people did not vote. Elderly voters helped propel the LDP to victory. It is ironic that the LDP won a sturdy majority of seats in an electoral system where the party received the votes of less than 20 percent of the electorate. Abe’s third-term cabinet is expected to more strongly promote “breaking free of the existing system.” The political task of revising the constitution will accelerate. The cabinet will also exert its energies toward developing a legal code to install collective self-defense. However, Abe will not be able to undertake revising the peace constitution right away. In order to secure passage of a motion to revise the constitution, Abe must first secure a two-thirds majority in the 2016 Upper House elections. A majority of voters must then support the constitutional revision in a national referendum. Given that 2015 marks 70 years since the end of World War II, it appears that Abe will take steps to pursue his historical revisionism. Abe’s remarks on August 15, the anniversary of the end of the war, will likely display his political thinking. Even if he does not directly call for the complete revision of the Kono and Murayama statements, there is a high probability that an “Abe Statement” will reflect his regressive understanding of history. There is great concern as to whether Abe’s third term will be used to thaw KoreaJapan relations. The year 2015 also marks the 50th anniversary of the normalization of relations between South Korea and Japan. This represents a great opportunity to upgrade cooperation between the two nations into a mature partnership. However, at present bilateral relations are under stress on all sides. The more we look at Abe’s political intentions the more he is unlikely to meet our expectations on even a single issue, be it the constitution, Dokdo, wartime military sex slaves (widely known as “comfort women”), or Yasukuni Shrine visits by Japanese leaders. Nevertheless, even though we are uncomfortable with Abe’s politics and policies, we cannot just turn our backs on Japan. We must carefully find a way to promote

relations with Japan as part of our broader foreign policy framework. It is extremely important for the Park administration to play the Japan card effectively when it comes to its foreign policy agenda, such as trust-building with North Korea, the Northeast Asia Peace Initiative and the Eurasia Initiative. When we consider the fact that an atmosphere of hatred toward Korea is spreading to the general population in Japan, we must use our diplomatic assets of universal standards, human rights and democracy much more actively in our public diplomacy. In order to find a breakthrough for Korea-Japan relations, we should insist on President Park meeting with Prime Minister Abe as soon as possible as well as cooperate with Japan where it is appropriate to cooperate as a matter of course. If the Korea-China-Japan foreign ministers’ meeting turns into a trilateral summit meeting, it would be quite natural for President Park to hold a bilateral meeting with Prime Minister Abe. We must resolve the issue of Japan’s sexual enslavement of Korean “comfort women” during World War II. However, rather than approaching the issue as a precondition for improving bilateral relations, it would be better to address the issue as an exit strategy when relations have been improved. We need look no farther than Japan prioritizing the resolution of North Korea’s abduction of Japanese citizens for an example of how sequencing can go astray. Japan’s North Korea policy has been kidnapped by the kidnapping issue. Even if it is difficult to hold a Korea-Japan summit meeting for the time being, we can think about a second-best strategy to return bilateral relations back to normal. Even if the two heads of state cannot meet, there are a variety of diplomatic channels that we should utilize. We need differing approaches to the Abe administration and the Japanese people. At the same time, we need a strategy of compartmentalizing policy issues with the Japanese government when it comes to historical, economic, security, cultural and territorial issues. We must consider the full range of ideas to take advantage of the 50th anniversary of the normalization of relations between Korea and Japan as an opportunity to do whatever it takes to bring our bilateral ties back to normal. [JoongAng Ilbo, December 16, 2014]

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President and Presidential Secretaries

President Park Geun-hye has a tea break with her newly-appointed senior secretaries and special advisor at Cheong Wa Dae January 26.

Bae In-joon Editor-in-Chief The Dong-a Ilbo

A controversial Blue House document says that Chung Yoon-hoi, who was one of President Park Geun-hye’s personal secretaries while she was a lawmaker in the late 1990s through the 2000s, still wields substantial power behind the present administration. The document describes three current presidential secretaries as power brokers who are taking advantage of their close proximity to the president. Cho Eung-cheon, who was the senior presidential secretary for civil affairs, has been accused of leaking the Blue House’s internal circular to the press. He fueled the controversy by telling the news media that the contents of the paper were “over 60 percent accurate.” With this belief Cho and his assistant at the presidential office allegedly wrote the document and leaked it. Cho is a former prosecutor. We wonder if a prosecutor drafts an indictment when he is only 60 percent confident of evidence. Cho said he was led to believe the accuracy of the information because it contained details about talks on state matters between Chung and current secretaries. At bars and restaurants people concerned with current affairs exchange facts and truths, rumors and fictions. Some convey rumors as if they were their own experiences. In this process of communication, an anchovy becomes a mackerel, a

mackerel becomes a tuna, a tuna becomes a whale. A winter goose becomes a spring sparrow. Even if we take all these factors into account, President Park’s denial was too quick and too strong. If the president believed that the document had the same amount of authenticity as stock market leaflets and that its disseminator(s) was a deliberate disruptor of national order, she should have patiently waited for the results of prosecutors’ investigation into the case. In other controversies, the president remained silent despite public clamor for a quick response. She was different this time. Some past presidents failed to take scandals involving their family members and close associates seriously. Former president Kim Young-sam turned a deaf ear to allegations of influence peddling by his son Hyun-chul, who was known as “the little president.” His loyal aides who advised him to stop Hyun-chul’s interference in state affairs or to send him abroad invariably lost the president’s favor. The result was Hyun-chul’s criminal prosecution and punishment and the president’s succumbing to an early lame duck situation. Former president Lee Myung-bak followed this pattern. When public alarms rang about the misdeeds of his close aide Park Young-joon, Lee brushed them aside, saying that he was “not really powerful.” Park also ended up in jail. President Park determined the three presidential aides now in the public spotlight are merely faithful helpers without real power. Histories of old and near, and of the East and West, show that the cute little poodles of absolute rulers acted like ferocious wolves preying on powerless people. We can find few exceptions to favoritism by those in power. When parents are told their children are in police custody for some misbehavior, the first reaction of most parents is “it can’t be true.” They did not know about the dark side of their children’s world. Amid the continuing gusts of winds that threaten to shake the government, the president should first check what happens immediately around her and try her best to rationalize the system of state governance from top to bottom. Whether the leaked Blue House document was as unworthy as stock market leaflets or not, the president is called on to reflect on herself and take responsibility for not

preventing what has happened. She should listen closely to questions about how she can pursue national innovation when discipline crumbles in the Blue House. With the president angered at criticism, comforted by internal justification and rejecting calls for a change, the administration is doomed to fail. The president should first of all accept the chastisement on her failed personnel appointments. Many people resent the inappropriate way high public offices have been filled in the Park Geun-hye administration and the disastrous consequences. The Blue House excessively exercised its power of appointment and produced a steady stream of unqualified public servants. It is desirable for the president to seek advice from senior statesmen and wise people who have no political ambition. If the Blue House had just followed the personnel system and methods generally practiced in private institutions, just ensuring transparency as the president has emphasized, incidents like the “memogate” that has stirred Korea’s political theater for weeks and months could have been avoided. Dependence on “my people” alone leads inevitably to the loss of checks and balances and heightens waste and disruptions in the system. What happens in private organizations is bound to be magnified in the world of power. Former culture-tourism-sports minister Yoo Jin-ryong and former presidential secretary Cho Eung-cheon who have caused so much damage to public trust in the administration were in fact the products of a failed government system aside from their individual shortcomings as public servants. A government where the system of checks and balances does not work well and a president who is not anxious to listen to the voice of the people are prone to trouble. Blue House conferences would revolve around what the president wants, failing to move ahead as the participants are unable to see where they are and what they need to do. [December 10, 2014]

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[DEBATE] Dissolution of the United Progressive Party

Former lawmakers of the United Progressive Party hold a press conference in front of the Constitutional Court in January 23, to denounce the court's ruling to dissolve their party.

[PRO] Editorial The JoongAng Ilbo

[CON] Editorial The Hankyoreh

[PRO] Inevitable under the Current State of National Division The Constitutional Court ordered the dissolution of the United Progressive Party and the removal of its five lawmakers from the National Assembly. The court action drew worldwide attention as it was only the fifth time in the modern history of the world that a political party that existed in a liberal democratic order has been dissolved under a court order. The position of the Constitutional Court on disbanding the progressive party was clear and resolute. Eight out of the top court’s nine justices, both liberals and moderates, accepted the Justice Ministry’s request for the party’s dissolution, recognizing its harm to the nation’s constitutional order. There was one dissenting justice against the majority opinion. The Constitutional Court made the difficult decision to protect liberal democracy amid the continuous confrontation against communist North Korea. Since the disclosure of the activities of the party’s “Revolutionary Organization (RO)” aimed at overthrowing the Republic of Korea through violent means, there arose 16

widespread public opinion denouncing the UPP as a group clandestinely seeking to realize North Korean-style socialism in South Korea. The Justice Ministry thus asked the Constitutional Court to render an opinion on whether the UPP was threatening the basic democratic order of the Republic of Korea. The Constitutional Court determined that the UPP was being dominated by the “national liberation” faction that aims to overthrow the nation’s present free democratic system through violence and armed struggles and install a progressive democratic system. The court also found that the UPP’s “progressive democracy” was in concert with North Korea’s strategy of liberating the South in a revolution. The Constitutional Court saw the danger of the UPP not only in its platform and strategies but in its practical activities. One of the major reasons for the party’s dissolution was the secret meetings of the Revolutionary Organization which Lee Seok-ki and other members held in order to work out plans to produce and steal weapons and help North Korea by destroying key public facilities in the South if war erupts between the two Koreas. The acts of the RO violated the laws and order of the Republic of Korea, transgressing the tolerable limits of normal partisan activities, according to the court’s verdict. At the same time, the Constitutional Court removed the five members of the UPP from the National Assembly by denying their “representative status” on the grounds that “the dissolution of the party is decided in order to defend democracy and protect the Constitution.” This was the first case of lawmakers losing their Assembly seats without being punished for crimes deserving the loss of parliamentary membership. The five Assembly members consisted of three elected from district constituencies and two with proportional representation tickets. We respect the Constitutional Court’s ruling while we feel a lack of legal explanation and prudent steps about this decision, which restricted the people’s right to elect their representatives. We support the Constitutional Court’s ruling, which we believe was inevitable under the dangerous condition of national division. Yet, we cannot but point out that the dissolution of a political party should be the last option in protecting our basic democratic order. It is an extreme measure that has left a heavy burden on our society. The basic democratic order is not a system for the majority only but

one that takes care of the minority too and embraces multiple values. It has to tolerate different world views. The problem of the UPP occupied the gray area between the universal principle of the freedom of expression and association and the need to protect the democratic order under the exceptional reality of South-North confrontation on the Korean peninsula. Amnesty International’s statement that the Korean court ruling could “weaken the freedom of expression and association” reflects concerns. Again we acknowledge that the Constitutional Court ruling was a hard decision. Still, it should not frustrate activities to express progressive values through diverse non-violent means. A democratic society can grow healthy when diverse values coexist, multiplicity is respected and the minority is guaranteed the right to make its voice heard. All values can develop under challenges and criticism; a society that does not tolerate challenges and criticism remains degenerative and anticivilization. Of the nine justices of the Constitutional Court, Kim I-soo alone presented the minority opinion. It deserves attention. He argued that the participants in the RO meetings did not control the UPP and that actions discussed in the meetings were not put into practice. He concluded that “those matters discussed in violation of the democratic order could not be attributed to the entire United Progressive Party.” Some conservative groups’ attacks on Kim are antidemocratic and diminish the significance of the Constitutional Court decision. The dissolution of the UPP manifested that all activities of political parties should be made within the confines of the constitutional order. But the democratic order cannot singularly be protected by the law; it essentially is the responsibility of the people. Regrettably, conflicts arose between the conservative and progressive sectors of society over the fate of the UPP. We all are obliged to take the dissolution of the UPP as an occasion to advance the democratic order in this country toward maturity. [December 20, 2014]

[CON] Death of Democracy, Death of the Constitutional Court The Constitutional Court decided the dissolution of the United Progressive Party on December 19. The party’s lawmakers were deprived of their National Assembly memberships. There was no clear, appropriate reason for the decision, nor any proof to support it. It was an arbitrary death sentence on a minority party for defying the majority force. Democracy based on the essential values of tolerance and diversity has been wholly denied. Democracy in Korea, which has been nurtured through great adversity over many decades, now faces possible dissolution and destruction. The Constitutional Court ruling left a big speck on the history of legal justice in this country. We now have another instance of political persecution using the sword of law, which has continued since decades ago. There were the executions of the members of the “People’s Revolutionary Party” under the rule of Park Chung-hee in 1974 and, further back, the execution of the Progressive Party presidential candidate Cho Bong-am by the Syngman Rhee regime on charges of violation of the National Security Law in 1959. In 1958, the Supreme Court ruled that the platform and policies of Cho Bongam’s Progressive Party were not in violation of the Constitution even after the party was dissolved by a government ministry’s cancellation of its registration. At that time, the court did not identify a party’s leading figure with the party itself. After the students-led April 19 revolution in 1960, the steps for dissolving political parties were introduced into the Constitution. They aimed at guaranteeing the freedom of parties and their existence against government harassment through such measures as cancellation of registration, not “protecting of the democratic order against enemies of democracy” as cited by the Constitutional Court this time. That spirit firmly continues today in the Constitution. The fact that the United Progressive Party has so far existed as a component of the representative democratic system signified the success of democracy in the Republic of Korea. No exclusion of the minority for harboring different ideas and assertions is the proof of democracy that fought and won over totalitarianism and dictatorship. The Constitutional Court turned the clock back with its ruling to expel a minority progressive group.

The Constitutional Court produced ill-contrived logic and an unconvincing argument to justify its ruling. Dissolution of a political party is the last resort that should be taken extremely restrictively under the strictest possible standards. To forcibly disband a political party, it must be evident that the party’s purpose and activities exhibit “concrete” danger of inflicting “substantial” damage on the basic democratic order of the nation. The court was unable to find such danger in the UPP’s platform but claimed that it could construe “hidden” and “real” objectives that are subversive. A “hidden” purpose of a party should have been proven unequivocally. But the court did not produce concrete evidence. It argued that UPP assertions resembled those of North Korea and that being in conformity with North Korea was the real purpose of the UPP. This reminded us of the arbitrary logic the prosecution used during the past authoritarian rule, in cases involving the National Security Law. The dissolution ruling was made hurriedly within a year’s time. Even if the Lee Seok-ki group was engaged in unlawful activities, they could not be regarded as representing the entire UPP, which had 100,000 members. The Constitutional Court, however, declared that the “Revolutionary Organization” meetings were deemed as a party-level function because the Lee group was the “leading force” of the UPP. In making the judgment, the court did not bother to prove that the group was really in control of the party or that the party followed the direction of the RO. Then the verdict showed a leap in logic by concluding that there was “substantial danger” from the ideological propensity and behaviors of the “leading group.” Meanwhile, in the criminal trial of Lee Seok-ki and the RO members, the existence of this supposedly subversive group was not recognized. Lee was acquitted of rebellion charges but was found guilty of other crimes. The Constitutional Court decision came before the Supreme Court’s final ruling on the Lee case. Besides, the Constitutional Court further decided the disqualification of the party’s lawmakers without any statutory grounds. Our society will suffer greatly from this ruling. The forceful dissolution of a political party can be used as a legal precedence in future attempts to restrict the freedom of political parties and that of political association. The political opinions

of many people who had supported the progressive party’s ideology will henceforth be distorted as unconstitutional or “subservient” to North Korea so that they could be excluded from the legitimate political sphere. Conflicts and confrontations between different political groups will continue to be aggravated. Now that the UPP has been kicked out, who will be the next? The political trauma of the 1987-born Constitutional Court’s denial of the essential democratic spirit of tolerance and relativity, the product of the same 1987 Constitution, will be longlasting. The 8 to 1 score for the ruling on the UPP speaks for the present method of composing the nation’s top tribunal, leaving serious questions as to whether it correctly reflects prevailing public opinion. There will also be raised the fundamental question about the reason for the existence of the Constitutional Court. It is the consequence of the court’s destruction of democracy in Korea, inflicting a self-injury in doing so. [December 20, 2014]

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- Jobs as Ballast Water for the Economy

- Conditions of an Advanced Nation and Capacity for Surviving Crisis

- [DEBATE] Are Korea's Regular Workers Overprotected

- Applaud Purse-opening Rich People

- What to Study in University to Become a Successful Manager

Jobs as Ballast Water for the Economy

Applicants for the first police recruitment for the year 2015 leave a test site in Seoul on February 14. A total of 60,303 applicants took tests for 3,200 openings, a ratio of 18.1:1.

Jun Sang-hun CEO Egis Communications

Let’s assume the Korean economy is a ship. It is critical to design the ship scientifically if the steel mass is to float and sail safely. The design needs to ensure that the ship will be able to sail safely with a maximum load of cargo and people on board. It is the same with the economy, which needs to have the most effective and stable structure. It is necessary to strike a balance between efficiency and safety to ensure safe travel on the seas. The key is the proper amount of ballast water. The ballast water for the national economy is employment. When employment is maintained appropriately, the economy can sail with little risk of being upended by high and rough waves. Ignoring design standards and reducing the ballast tank would increase the passenger and cargo capacity and thus boost earnings. But it would be simply insane because the ship would be exposed to higher risks. A short-term boost in the property market or introduction of casinos would be comparable mistakes in the economy. Ballast water is out of sight, while passengers and cargo are visible. So it is

tempting to reduce what’s not visible and increase what’s obvious. Jobs and income don’t rise instantly. On the whole, their growth is invisible. But speculative businesses and real estate investments may deliver an immediate, tangible stimulus to the economy. Korea is a low-growth economy, with its gross domestic product expanding at an annual average rate of 3 percent. Barring the unexpected, the low-growth trend will probably persist for a long time. But even when Korea moves forward slowly, it needs to give priority to jobs and income. Job sharing and income redistribution need to be expanded. Jobs requiring a college degree or higher are likely to be in short supply. As such, it is necessary to shift the focus in education policy from college admission to vocational training in high schools and two-year colleges. What the government needs to do is acknowledge that the economy is going through a dark tunnel and take up the hard process of creating jobs and increasing income, albeit at a snail’s pace. Gearing policy to slow but steady progress will obviously mean hardships and prompt criticism from victims, but isn’t persuading the public part of the government’s role? It goes without saying that the captain of the Korean economy is the president of the Republic of Korea, with its crewmembers being the government and the National Assembly. If the captain and the crewmembers attempt to illegally change the structure, reduce the ballast water and overload the ship, someone must stop them. Who can stop them? Only the citizens, the owners of the ship, can do it. There are over 50 million people, but many of them don’t even realize they own the ship. They are not to blame, given that they are rarely treated as owners until an election comes around. But once the election is over, they are treated the same ― like third-class passengers suffering from seasickness in an illegally expanded, shabby cabin. With no election scheduled for this year, citizens will not be treated as owners. Yet it does not mean they are deprived of an opportunity to assert their ownership. They need to order the captain and the crewmembers to sail slowly

for a safe journey. Â [JoongAng Ilbo, January 9, 2015]

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Conditions of an Advanced Nation and Capacity for Surviving Crisis

Names of the victims of the Sewol sinking are seen along with messages of their family members on a memorial altar at Paengmok Port on Jin Island, on January 24.

Yukiko Fukagawa Professor, School of Political Science and Economics Waseda University

During a visit to Korea, I was asked to describe the conditions of an advanced nation. My thoughts turned to Britain, where I am staying now. The British economy, together with the U.S. economy, is making a solid turnaround. Though a slump in Europe is causing a slowdown in British exports, the British economy is projected to record 3 percent growth in real terms for 2014. Recovery is spreading from the property market to consumer spending and corporate investments with signs of shrinking unemployment and rebounding wages. The vitality of the British economy, which wowed the International Monetary Fund, is in contrast with the risks bedeviling emerging economies ― China, Brazil, Russia and India. The British economy has capital accumulated since the Industrial Revolution and the use of English as the mother tongue. Yet, the British per capita income, which stands at around $40,000, is not so high. Sighs are heard about the decline in the quality of education and widening gaps in education among different income

brackets. But British people share unwavering national expectations. First among them is that the nation should ensure public safety. It can hardly be said that the quality of labor is high at workplaces in Britain. Moreover, everything is slow. Infrastructure has deteriorated. The subway system and other means of mass transit are riddled with many problems. But service providers don’t try to reach beyond their capacity and understanding customers wait patiently. As such, there are not so many accidents. There are security cameras everywhere. Even on peaceful university campuses everyone is encouraged to report suspicious-looking people or dangerous conditions. Entrenched in the minds of the people is the perception that it is not hardware but a system of participation that helps maintain security. The rate of heinous crimes, such as murders, is much lower in Britain than in Korea. So are accidents. The British elites believe that they have the political responsibility to feed the entire general population. Hence they don’t hesitate to put a capable foreigner in the position of governor of their central bank when no qualified person is found among themselves. On the other hand, in emerging economies, where nationalism may be strong, the family is the prevailing unit. Family-owned businesses are the economic drivers, and form relationships with political elites. Families bear the responsibility for social welfare. A nation may not have many problems concerning social welfare when its economy grows fast. But it will have to work harder to collect taxes equitably and look after more destitute people in low-growth periods. Quite a few emerging economies flounder at such a stage. Britain is often associated with diseases of democracy that lead to increases in social welfare spending and populism. The value of its well-maintained social safety net may be underestimated, though it helps give birth to new businesses,

keep its birth rate from falling and reduce the political and social cost of resenting successful people. Britain is conservative. Yet it is tolerant of the unorthodox and the eccentric. New ideas, not a tunnel view, are found in services ranging from structuring the financial industry’s portfolio to consultancy and designing. Journalism in Britain is diverse. It hates parroting what the government says. On the contrary, it remains critical even when Britain is doing well. What is Korea like? According to Freedom House’s press freedom rankings, the news media is “partially free” as it is in India and some Southeast Asian countries. Korea’s ranking is lower, not because of the legal or economic environment, but because of the media’s relations with the government. Among the “seven advanced nations,” which include Britain, Italy is the only country with a similar level of press freedom. What Britain suggests is that a nation is advanced if it routinely has the capacity to do what needs to be done. It is little different from the basic capacity of a figure skater to move exactly as intended in whatever circumstances. This capacity, not a dazzling choreography, made Kim Yuna a world champion. Dazzling growth does not make a nation advanced. Rather it’s the capacity to survive crises. A new day will surely dawn if a country keeps itself from floundering before a crisis. [Maeil Business Newspaper, December 2, 2014]

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[DEBATE] Are Korea's Regular Workers Overprotected?

Amid news about the rising number of non-regular workers that topped 6 millon for the first time, cashiers work at a large retailer in Seoul on January 18.

[PRO] Lee Ho-sung Managing Director Korea Employers Federation

[CON] Lee Byung-kun General Secretary Federation of Korean Trade Unions

[PRO] Need to Ease Labor Market Inflexibility New requirements regarding pay scale, retirement age and holiday pay are placing additional strains on Korean companies all of a sudden. A Supreme Court ruling led to a 26.7 percent increase in wages (regular bonuses included) in 2014 at conglomerates with more than 1,000 employees, according to a Korea Employers Federation survey. In addition, management is facing labor resistance on wage reform that will accommodate extension of the official retirement to 60, beginning in 2016. Companies will have to grapple with a seniority-based pay system that hoists salaries to top global levels. The issue of holiday pay still remains pending at the Supreme Court. Bills, including those envisioning doubling holiday pay and shortening working hours, are also pending at the National Assembly. Regardless of what the Supreme 29

Court decides, the legal working hours will decline more than 10 to 20 percent. A reduction in working hours will endanger small and medium-sized enterprises (SMEs) that are short-staffed and therefore must operate long hours in order to produce enough to meet customer demand. Obviously, efficient use of personnel is essential for companies to cope with higher labor costs. But employment adjustments by large conglomerates are unconditionally criticized and even compared to “murder.” Ssangyong Motor, on the verge of liquidation in 2009, faced fierce resistance from its union against management’s employment adjustment plan. Despite the company’s zero turnover due to its plunging competitiveness, workers of Hanjin Heavy Industries & Construction staged a lengthy strike against employment adjustment. All this reminds us that it has virtually become impossible for an employer to adjust employment as needed. Such labor market rigidity is attributable to the tough and uncompromising stances of unions at some conglomerates. Besides, the unions are empowered by the nation’s labor protection laws that are among the strongest in the Organization for Economic Cooperation and Development. Korea is one of the few nations that prohibit temporary employment of substitute workers during union strikes. Under strict provisions on employment termination, even the dismissal of those who have damaged their companies or who are deemed incompetent has been ruled illegal by the court. Under the latest court ruling, companies are even required to directly employ workers of subcontractors like delivery service providers. Companies try all types of options before deciding to adjust employment. But they can hardly do anything without consent or cooperation from unions under the current labor laws. Therefore, conglomerates are keeping a lid on hiring. Likewise, the dual labor structure continues to intensify. Structural reform of the labor market should begin by easing such rigidity to increase corporate competitiveness and regain vitality of the labor market. Major advanced countries like Germany and the UK have already resolved overprotection of regular workers

and implemented reforms by eliciting unions' compromise and improving their social safety nets. Now it is our turn. First of all, regular workers at large conglomerates should make concessions and take the initiative in finding solutions. If this leads to more hiring and support to affiliate firms, it would help create a virtuous circle of more jobs and business revitalization in all economic sectors.

[CON] Argument about Labor Market Inflexibility Farfetched Finance Minister Choi Kyung-hwan has pledged out of the blue to ease provisions on the employment termination of regular workers for the sake of removing discrimination against non-regular workers, saying, "Regular workers are overprotected." The best way to remove discrimination against non-regular workers is to turn them into regular employees. But he said he would close the gap between regular and non-regular workers by making the dismissal of regular workers as easy as that of non-regular ones. This is really absurd. This would worsen the working conditions of all workers, shrink consumption and disrupt domestic businesses. Choi even said, "Companies are burdened with the guaranteed employment of regular workers until their retirement age of 60. So we need to reform the wage system." The wage system of individual companies is determined by labor and management according to their specific conditions. It is not a matter open to government interference. Some companies need high skills and extensive worker experience, others need to fill simple jobs, and still others may need manpower to evaluate research results. A recent study shows that wage systems have no impact on productivity. Many companies have a salary system based on both seniority and performance. Some companies have adopted a wage peak system, which extends retirement age in exchange for declining salary levels in the years prior to leaving. All this implies that the government should not cause labor-management conflict by stressing the need for wage system reform. The government is citing the labor market rigidity as an excuse to reform the

wage system or make layoffs easy. But various statistical data show that our country's labor market is never rigid. Korean workers' average employment tenure is 5.1 years, the shortest among OECD member states (the OECD's average employment tenure is 10 years), according to a survey by the Korea Labor Institute conducted for the Ministry of Employment and Labor. This means that employment is unstable in Korea. The ratio of temporary workers to paid workers in Korea is 23.8 percent, the second highest among the OECD members. Korea's ratio is double the OECD average of 11.8 percent. Korea ranks third in the OECD in terms of collective dismissal, and comes in 17th among the 34 OECD nations in terms of general dismissal. The official retirement age at Korean companies is between 57 and 58, but it is in fact 49, until which age only a few workers can continue to work at the same company. In reality, many workers voluntarily leave companies before their retirement age. And by law, companies can lay off employees in a time of crisis. Last year, 380,000 workers were laid off, almost the post-currency crisis level of the late 1990s. This clearly shows that many Korean workers are suffering from unstable employment and layoffs. The government tries to make layoffs easier for companies by citing cases of foreign countries. But it mentions nothing about their social safety nets that protect laid-off workers, even though layoffs and a social safety net are closely interrelated. Korea has a weak social safety net. Laid-off workers struggle to lead a normal life and prevent their family from being destroyed. In a word, unemployment means death in Korea. In the five years after Ssangyong Motor began laying off workers, 25 workers and their family members killed themselves. The maximum daily unemployment benefit is 40,000 won for 90 to 240 days, depending upon employment periods. In short, laid-off workers receive a mere 1 million won a month for eight months at the most. This is far different from EU countries. In Germany and the Netherlands, workers receive up to 90 percent of their prelayoff pay for three years. In Denmark, they receive up to 90 percent of their prelayoff pay for two years. In Sweden, they get 100 percent of their pre-layoff pay for a year. In view of our country’s current welfare level, it is not appropriate to

compare our employment flexibility with that of other countries. Â The government should further toughen conditions for layoffs and build a sturdy social safety net. It is nonsense that the government, which has pledged to achieve a 70 percent employment rate, is considering first how to lay off workers. Â [JoongAng Ilbo, December 12, 2014]

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Applaud Purse-opening Rich People

An employee at Korea Gold Exchange arrangers gold items on December 1, 2014, amid news about surging sales of gold bars since May in the year.

Park Hak-yong Editorial Writer The Munhwa Ilbo

Let me share an anecdote I recently heard from a commercial bank official doing private banking in Gangnam ― the premier business and residential district south of the Han River in Seoul. He said refrigerators for storing kimchi are unseasonably selling well. Surely, it is not a kimchi-making season. But the demand for kimchi refrigerators is high, he said, because people having a hoard of cash use them for storing highdenomination bills. They are shunning coffers because bills turn humid when they are kept in them for a long period of time. We read worrying news. HSBC and Moody’s Investors Service have lowered their 2015 growth outlooks for Korea to 3.1 percent. BNP Paribas and UBS cut their outlooks even further to 3 percent. The state-funded Korea Development Institute also lowered its growth outlook to 3.5 percent. If the forecasts are not well off the mark, the Korean economy will underperform for the fifth consecutive year, with actual growth trailing far behind the growth potential, which is reportedly hovering between 3.5 percent and 4 percent. Hopefully, it should not be the prelude to a long-term slump.

What is happening reminds me of what Lee Hun-jai, who served former President Roh Moo-hyun as his deputy prime minister, said about rich people. When consumer spending sagged, he said, “The nation will collapse if rich people do not open their purses.” He added many rich people in the United States spend as much as they can within the limit set by their asset managers. When growth stalls, consumers tend to curb their spending as their income falls. Yet, Koreans are challenged by few other people when it comes to tightening the purse strings during a slump. During the past 10 years, growth in consumer spending has trailed far behind that in gross domestic product. According to a Nielsen survey, the global consumer confidence index is on the rise this year. Korea is the only country where consumer confidence is dropping. Worse still, Korea is following the footsteps of Japan, which had “two lost decades.” Population aging accelerated with the Dankai generation (those who were born in the second half of the 1940s and led high growth in Japan) reaching retirement age. Worried about their future, the retirees cut down on consumption, procrastinating and deepening Japan’s protracted slump. With Korea’s baby boomers (born during the 1955-63 period) retiring and population aging accelerating simultaneously, a decline in consumer spending hangs ominously over the nation’s economy. The propensity to consume (spending divided by disposable income) is 68.8 percent among those in their 50s, a relatively wealthy generation. The rate drops to 66.6 percent among those in their 60s or older, the lowest since the statistics was first compiled. This is understandable; they surely need to have enough resources for old life, but their home prices are falling and interest rates, minus in real terms, are eating into their savings. Output and spending have to increase if the economy is to grow. An additional monthly spending of 260,000 won by everyone in the high-income bracket projects on annual basis to 168,000 new jobs and 7.2 trillion won more to gross domestic product. In other words, the economy will make a turnaround when those wealthy people holding 80 percent of the national wealth open up their purses.

What needs to be done to encourage the wealthy to spend? They hate uncertainties. They do not care too much about fiscal expansion or a rate cut. But they abhor conflicts in policy. What can be said if the administration, while vowing to bolster the economy, reduces the maximum daily withdrawal from an automated teller machine to 1 million won from 6 million won in an attempt to stifle withdrawals from fake deposits? Such armchair theorizing can hardly induce the wealthy to bring out cash from their kimchi refrigerators and spend it. A policy has to be made simple and coherent if it is to encourage the wealthy to open up their purses. Public sentiment against the wealthy is another obstacle to their spending. The demand for egalitarianism goes too extreme in our society. Not many Koreans accept being second to anyone. An example in point: Children run in a race everywhere in the world. They strive for first place. Nothing is wrong with it. In Korea, however, children chant, “Running in front, you are a thief; Running behind, you are a policeman.” When the wealthy spend, don’t say, “Where did they get the money?” Instead, just applaud them, saying that they are patriots creating jobs and raising income for others. It is also necessary to give the wealthy incentives to spend more. For example, they may not go abroad for medical treatment or tourism if those services are upgraded at home. The National Assembly will have to pass bills on the service sector, medical care and tourism promotion during its extraordinary session opening on December 15. Political instability is a major source of unpredictability. Economic issues are shelved as the political circle is swept into a whirlwind by allegations against President Park Geun-hye’s erstwhile confidante, Chung Yoon-hoi. As a Yiddish saying goes, a golden key opens all doors. At the turn of the year, it is hoped that the wealthy will be encouraged to open the doors to recovery with their golden key. [December 12, 2014]

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What to Study in University to Become a Successful Manager?

High school students attend a lecture on English literature at a humanities camp, held at Seoul National University on January 22.

Chang Sea-jin Techno-SK Chair Professor, Business School Korea Advanced Institute of Science and Technology (KAIST)

Those who took the college scholastic ability test will certainly rack their brains, together with their parents, about what department of what college they will apply for admission to. Given that it is increasingly difficult for college graduates to land a job, they must be careful in selecting majors. Almost all college students, except for those studying at medical or law schools, will have to find a job upon graduation. What should be their major if they wish to be corporate managers? It is often said that corporate managers who studied science, math or engineering excel in analyses and problem solving. Satya Nadella of Microsoft, Jeff Bazos of Amazon and Mary Barra of General Motors have a background in engineering. Jeffrey Immelt of General Electric was a math major. On the other hand, humanities help people understand the behavior of a person and the motive behind it and enhance their ability to respond properly to uncertainties and communicate with other people. Steve Jobs of Apple studied philosophy and Kenneth Chenault of American Express majored in history. 38

According to a 2014 survey, 38 percent of the CEOs of the 100 largest business enterprises in Korea majored in either economics or business administration, followed by engineering majors, who accounted for 28 percent. The others, or 34 percent, majored in the humanities, social sciences and natural sciences. According to a Fortune survey, 26 percent of the CEOs of the 100 largest corporations in the United States were either economics or business administration majors, followed by engineering majors, who accounted for 20 percent. The remaining 54 percent studied the humanities and social and natural sciences. Given the outcomes of the surveys, it seems as if those who have studied economics, business or engineering have a better chance of reaching the position of chief executive officer. But that is nothing but an illusion, because a predominant number of students have been majoring in economics, business administration or engineering. No study has found that the study of a certain discipline is particularly helpful to anyone becoming a CEO. What are more important than a major in college are extracurricular activities. In his survey of 6,521 graduates of MIT from 2006 to 2012, Pian Shu, a professor of Harvard Business School, looked into what he called their “raw academic talent” before entering MIT, their activities, what they studied, their grade point averages, the careers they had after graduation and other details. MIT, strong in engineering and sciences, also has good economics and business administration departments. Unlike at Korean universities, which require each student to decide what to major in when he applies for admission, students at MIT take liberal arts and basic courses during the first two years. In the third year, they start to take classes for their majors. Those who are strong in math are welcomed by the finance industry. According to Shu’s survey, future financial employees take courses that are different from those taken by students going to graduate school. Future financiers, the highest in their pre-admission raw academic talent, are lower in their GPAs than those desiring to go to graduate school. They tend to take fewer courses than those who aspire to go to graduate school. Instead, Shu says, they are far more likely to participate in intercollegiate sports, internships

and fraternities or sororities, which help develop leadership, teamwork and communication. By the time they graduate from MIT, the two groups have different skill sets. It cannot be said that the science and engineering communities are losing talented students when science and engineering majors are hired by financial institutions. Instead, they find their careers in the finance industry because they are more interested in finance, rather than science or engineering. The 2008 financial crisis provided a good opportunity to look into the abovementioned findings. There was not much change in the choice of careers by MIT students, though many financial institutions collapsed and those that have survived the crisis stopped hiring. Few economics or business administration majors graduating in 2009 said they were seeking jobs related to sciences or engineering. Nor was the percentage of students who wanted to major in economics or business administration lower when the crisis was over. The new findings suggest that the two groups are separate and not competing against each other. They also suggest it is not a major that determines who will make a competent business manager. If a student finds his major does not fit him well, he may strive to develop skills required for business administration. An engineering or humanities major may enroll in economics and business administration courses, join a fraternity, develop social leadership and take an internship, while honing communication and teamwork skills, if he wishes to become a business manager. As such, students applying for admission to university do not have to worry too much about what they will major in. More importantly, they will have to figure out which universities will best help them discover their real field of interest, best assist them in developing the necessary job skills and allow them to change their majors or take courses for minor degrees. Additionally, they may choose to go to a graduate school of business administration. In conclusion, a major written in a diploma has nothing to do with who will make a good business manager. Regardless of their majors, students applying for admission to university will have to confirm they are interested in business administration and acquire the needed skills.

Â [JoongAng Ilbo, December 15, 2014]

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- Keep Our Children from Becoming Islamic Militants

- Korea's Conglomerates Must Change their Backward Thinking

- Low Salary and Miseries of the World

- Elites and the Learned Culprits of Angry Society

- Getting Out of the Black Hole of Chaos

- Underdeveloped Society in Handling Sex Crimes

Keep Our Children from Becoming Islamic Militants

A road sign at the Turkish refugee village Besiriye near the Syrian border, where the 18-year-old Korean boy identified as Kim last seen before he went missing on January 10.

Kang In-sun Weekend News Editor The Chosun Ilbo

Few parents in Korea have probably imagined that their son would become a member of the radical militant group, the Islamic State (IS). Even fewer would have imagined that their daughter would marry an IS member. For most Koreans, the IS has been a totally unfamiliar and terrifying entity from a faraway country, of which they can only learn through foreign news media. Establishing a theocratic state ruled by a caliph, or a political and religious successor to the prophet Muhammad, sounds implausible. Yet, with extreme brutality and ruthlessness, the IS is striving to achieve the goal. It is mounting terrorist attacks as well as kidnapping and beheading foreigners, and releasing videos of the executions. It’s horrible to think that members of such an extremist organization may have had contact with our children through social media to persuade them to become fighters to their cause. But, given the recent case of a Korean boy identified as Kim, who went missing near Turkey’s border with Syria, this is no longer fire on the other side of the river. When a Turkish news outlet reported that Kim has apparently joined the IS, we thought it was very unlikely. However, evidence of the boy’s contact with the IS has been secured as well as a note, in which he said, “I want to leave this country

and my family to live a new life.” It has yet to be confirmed whether Kim has actually joined the IS, but it seems obvious that this group has approached us far closer than thought. The question is whether Kim is a single isolated case among our youngsters. Or, is he just one of many in their teens or twenties who share similar thoughts? The latter seems more likely because many other countries in the world already have similar concerns. The IS members reportedly include the so-called “lone wolves,” but a lot of normal young people are also rushing to Syria to join the group. Some 15,000 to 20,000 young people from 90 countries are estimated to have so far crossed the border to Syria. Even in Norway with the per capita national income approaching $100,000, as well as in peaceful and tranquil New Zealand, the IS is agitating the hearts of many young people. In the Netherlands, a 19-year-old girl fell in love with an IS fighter and went to Syria, so her mother made a hazardous journey to the country to rescue her. Why are young people attracted to the IS? A French female journalist, who recently published a book based on her experience of contacting an IS recruiter of new fighters, has said, “Lonely adolescents are easily drawn to IS members who show great interest in them.” Perhaps they are beguiled, just as some get trapped in pseudo religious groups or multilevel marketing organizations. Some are deluded by the illusion that they could become heroes; some are tempted by offers of job or monetary reward; others are lured by the opposite sex. The IS propaganda is known to be refined, but I don’t understand how young people could be fooled by such absurd rhetoric. It still may sound tempting to young people who are frustrated by unemployment and suffocated by the uncertainty surrounding their future. Teenagers who hate the world may also have an entirely different interpretation. In Nam-sik, a professor at Korea National Diplomatic Academy, said, “I traced the fighter recruitment channels of the IS and was surprised to find how easy it was to contact them.” One can be exposed to the IS propaganda by simply visiting such sites as YouTube, Instagram and Facebook, and find ways to get in touch with them. We should not rule out the possibility that the IS recruiters are

reaching out to many of our children so that we can find ways to keep them from dangers of following in the footsteps of Kim. Â [January 24, 2015]

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Korea’s Conglomerates Must Change their Backward Thinking

Korean Air heiress Cho Hyun-ah makes a deep bow before journalists on December 17, 2014, before entering a Seoul district prosecutors' office for questioning over her so-called "Nut Rage" on a flight.

Shin Gi-wook Professor of Sociology; Director, Shorenstein Asia-Pacific Research Center Stanford University

“Nut Rage” has attracted worldwide attention. Naturally, Korean Air’s carefully cultivated image as one of the world’s leading airlines has taken a big hit, but I worry that this could lead to negative impressions of Korean companies more broadly and even Korean society as a whole. There are reports that some are boycotting Korean Air and reservations have fallen since the incident. Korean Air and Korea’s conglomerates (chaebol) face a bigger challenge: Unless they change their way of thinking and make institutional improvements, there is a high probability that this kind of incident will happen again. Former Korean Air Vice President Cho Hyun-ah probably had no idea that her rash behavior would have such far-reaching repercussions. If this kind of thing had happened in the past, there is a good chance that it would have been a minor affair quickly forgotten. It is a good thing Korean Air Chairman Cho Yangho said that the incident reflected his daughter’s personal problems and his failure to educate her properly. However, this is not simply a case of poor family education at a particular conglomerate. Instead, the shock to the Korean public was great because Nut

Rage offered a rare glimpse of the twisted sense of entitlement felt by many of the chaebol owner families to aimlessly occupy their positions. Some years ago the child of a certain chaebol owner was accepted to Stanford University. At Stanford it is mandatory for freshmen to live on campus in a dormitory. In spite of this regulation, to my surprise the parents contacted me and said, “It would be great if our child could live off campus. Please help us.” I tried to explain to them that there is a reason that all students have to live on campus for their first year and that is an important part of Stanford’s educational philosophy, but to no avail. On the contrary, I got the distinct sense that the parents were sad that I could not meet their request. This student received a diploma from Stanford University, but I am not really sure if the student really grasped what the university was trying to teach. If these chaebol offspring want to receive special treatment at an American university, can their behavior be any better in Korea? Even though the vast majority of chaebol are publicly traded companies, the owners treat the companies as if they are their own property and think it is only natural for their children to eventually assume the reins of power. If she had not been a member of the owning Cho family, could Cho Hyun-ah have become a vice president while still in her 40s? Korea’s representative conglomerates are on the cusp of passing on power to the third generation. Samsung’s Vice Chairman Lee Jae-yong and Hyundai Motor’s Vice Chairman Chung Eui-sun are the descendants of the founders of each company. They may be the largest shareholders, but they hold only a small fraction of the overall shares so they should not be called the owners. Accordingly, we can accept their inheritance of corporate power if the individual has superior abilities, but this is not desirable for the company if it is only because they come from the owner’s family. Moreover, corporate governance specialists have pointed out that it is even more of a problem if the stock market becomes distorted because the owners are obsessed with ensuring a smooth succession. In the case of the United States, even though companies like Ford Motor and Hewlett-Packard are named after their founders, there are no cases where the founder’s descendants are considered the owners. Microsoft’s founder Bill Gates

made a personal decision to walk away from his company. Similarly, since Steve Jobs left Apple there has been no news of his family trying to succeed him. The founders put all of their efforts into creating their companies rather than owning them. If we want to prevent a recurrence of Nut Rage, the chaebol families must stop thinking that they are the owners of their companies. In the mind of an “owner,” employees are considered nothing more than farm hands and must unconditionally obey the owner families. Moreover, the lines of communication between owners and their personnel naturally become problematic when the owners are only told what they want to hear. Korean Air’s efforts to cover up and smooth over Cho Hyun-ah’s outburst exhibited the screwed-up work environment at Korea’s large conglomerates. How else could the foreign media (including the Washington Post) liken the succession issue at the chaebol to North Korea’s dynastic rule? The founding families, as the largest shareholders, can play a role in the management of their companies depending on their abilities and the situation, but they must concentrate their efforts on rekindling the creative spirit of their founders. Instead of obsessing over passing power to their descendants, the founding families have a duty to first and foremost foster a corporate culture and institutions that will foster the creativity that led to the founding of the companies in the first place. That is the only way to keep Nut Rage from happening again and for Korean companies and for the Korean economy to make the jump to the next level. [Dong-a Ilbo, December 24, 2014]

www.koreafocus.or.kr

Low Salary and Miseries of the World

Young civic activists perform in downtown Seoul to draw attention to "black companies" that force employees to work long hours for low pays, on November 9, 2014.

Park Seon-young Staff Reporter The Hankook Ilbo

What is the wage level that corresponds to your definition of “low wage labor”? Since everybody constructs a world of their own in their minds, and money seems to be in perpetual paucity for many of us, it is natural that people may hold different perceptions. My own conception of the “low wage” bracket was between 1.5 and 2 million won per month, considering the salaries of new college graduates were averaging 2.78 million won. Of course I resented the fact that non-regular workers with more than 10 years of work experience still receive less than 1.1 million won a month, and I was also stirred by the fact that security guards who keep apartment gates earn less than 1 million won a month as they stay outside the legal protection of minimum wage. In my conceptual topography, however, these cases seemed to be about some marginalized minority. To me, such vocabularies as “low wage” and “low income” tended to describe only a small fraction of society. I held onto a wishful thinking that hinges on a diamond-shaped social structure that has the middle class occupying the biggest section. I proved to be completely wrong. The salaried workers who receive less than 2 million won a month do not exist in social peripheries only. I was astounded at

the news of “regional employment survey for the first half of 2014,” released by Statistics Korea in late October. Among the total 18 million salaried workers in Korea, the biggest percentage receives a monthly wage of between 1 million and 2 million won. Nearly four out of every 10 people on payrolls (37.3 percent) who go to work every morning and come back home late in the evening receive only 1 millionsomething won a month. If the 12.4 percent of the Korean salaried workforce who earn less than 1 million won a month are added, about half of Korean employees receive less than 2 million won per month. In fact, the wage bracket of 2 million to 3 million won means a “high wage” category, where only 24.8 percent of Korean waged workers belong, whereas only 13.1 percent receive a wage between 3 million and 4 million won and only 12.4 percent receive 4 million won or more per month. I have so far gravely mistaken these “high wage” workers as the nation’s average. It is not uncommon that our use of language conceals and distorts realities. However, I find the use of the “low wage” concept particularly deceitful. How could we refer to the wage level that applies to a half of our nation’s salaried workers as “low wage”? I have brooded over these figures for a long while: where are those waged workers who receive less or a little more than 1 million won per month and make up the half of the nation’s waged labor force? How could my own perspectives towards the world remain so groundless and misguided? I started to investigate the reasons and cases around my own circles. A strike by catering workers at my first child’s public kindergarten drew my attention to the status of non-regular kitchen staff at schools. They work eight hours a day and get paid 46,770 won a day. That translates into a monthly salary of slightly more than 1 million won. My second child goes to a private day care center. A teacher there receives 1.09 million won as the starting monthly salary, which only augments to 1.4 million or 1.5 million won thanks to government subsidy and other complimentary payments. A salesperson at a department store where a relative of mine also works for makes about 1.2 million won as his or her first monthly salary, while a barista in a café where I visit often earns about 1.1 million won for his or her first month at

work in spite of managerial responsibilities. Without my knowledge, like an epidemic, such practices of adding only a few hundred won on top of the minimum wage (set at 5,210 won this year) have been running rampant, monetizing the value of labor at a rate to liquidate human dignity. The miseries of the world derive from the fact that human life does not receive a fair value. While a half of the nation’s salaried workers fail to make even 2 million won a month, such agendas as marriage, childbirth, childbearing and education remain sheer luxuries. However, still many people raise their voices to say that each deserves what one deserves, or criticize that one should have worked harder to go to better schools and achieve more in life. That is why everybody is so obsessed with private education to afford better chances, which however results in a vicious circle that makes the majority of people losers of competition. Meritocracy has become a monster dominating the Korean society. Even though it is unacceptable to write off the value of any one hour’s work into a mere 5,210 won payment, the belief in the merit system continues to prevail surprisingly and sadly. Such news articles bombard local media outlets that Korean companies hold more than 500 trillion won as retained earnings, that the real wage increase rate fell to zero-something percent, and the average wage has not returned to the pre-financial crisis level. It would be ideal if the accumulated corporate cash holdings could be shared as employee wages. However, the challenge is that the last thing desired by all the business owners of the world ― from the self-employed to the CEOs of large corporations ― is a demand for higher salaries. The government exists to resolve such tensions between labor and businesses. However, the government just announced a new policy designed to “alleviate overprotection of regular employees.” We have been so wrong. Perhaps we have already given birth to way too many children. [December 5, 2014]

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Elites and the Learned: Culprits of Angry Society

Seoul Philharmonic Orchestra CEO Park Hyun-jung announces her resignation on December 29, 2014, under accusations that she abused employees.

Kang In-sun Weekend News Editor The Chosun Ilbo

“Please tell me if there was anything I said or did to hurt your feelings this year.” An entrepreneur in his 50s, whom I met at a year-end party, told me that he had made this request to his employees. At the time, the “Nut Rage” involving Korean Air heiress Cho Hyun-ah and allegations of verbal and sexual abuses by Park Hyun-jung, CEO of the Seoul Philharmonic Orchestra, were causing a great stir throughout our society. The entrepreneur’s employees responded that there had been no such incident and yet he insisted that everyone write down five such cases on paper. Previously, he said, he often scolded his employees in the office but now wishes to change the way of communication. A successful career woman in her 40s also says that she minds her p’s and q’s these days more than ever, whenever she visits a bank or a department store. Employees at these places are gentle to their “king-like customers” but she can’t be as comfortable as she wishes for fear that she might look bossy. An array of “super bossy” acts committed by some rich and powerful people, including Korean Air heiress Cho Hyun-ah, lately motivated leaders in small and big organizations to check their own manners and speech for thoughtless extremism.

Our country has raged with anger throughout this year. The ire started with the Sewol ferry disaster, which claimed hundreds of innocent lives, and then ran high with an Army private’s death from beating in the barracks, sex scandals involving high-ranking government officials and sexual harassments of female students by university professors to culminate in the Nut Rage. Sexual or power abuse was the main ingredient of these incidents. Those who made people sad and angry were mostly those of high social standing or learned elites. They graduated from prestigious universities, passed difficult examinations, studied abroad, earned doctorate degrees, have nice jobs, or were born and raised in wealthy and renowned families. They were the so-called elite members of our society, who are envied by ordinary people. After all, the culprits of many problems in our society are the “elites” and ‘the learned.” Kwak Geum-joo, a psychology professor at Seoul National University, said, “The dominant sentiment in our society this year has been anger in a word.” Our society was once prevalent with han (grudge) and then jealousy, but today it is definitely anger. Something that could have been passed over in the past often leads to a dangerous point of explosion these days. Anger is highly contagious, tending to spread from top to bottom, because people rarely vent it on their superiors. However, since every individual has superiors and inferiors, anger expands into the entire society. According to Woo Jong-min, a psychiatrist at Paik Hospital in Seoul, anger spreads faster than any other sentiment. Koreans wasted a tremendous amount of national energy in the face of a series of frustrating events during this year. However, anger is not necessarily a negative sentiment. Righteous anger can turn into momentum or driving force for change. We just should not vent our pent-up emotions through sadness and anger. Let’s not say that we will simply shrug off what we’ve gone through this year and greet a new year. With our eyes open wide, we must watch how these frustrating events will bring about changes in the year ahead. It’s important above all else how the elites and the learned will change. [December 27, 2014]

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Getting Out of the Black Hole of Chaos

Students who applied for the Department of Art Content at Sahmyook University in Seoul take skill tests on January 4.

Lee Ha-kyung Editor-in-Chief The JoongAng Ilbo

I watched the movie “Interstellar.” Although I couldn’t wholly understand the splendid feast of modern physics, represented by such highly technical terms as “black hole,” “white hole” or “warm hole,” I was able to feel the inherent sorrow, which swooped down on me. In the movie, a former NASA pilot sets out on a life-threatening journey to find a new home for human beings, who are in danger of losing Earth. However, strong gravity pulls his spaceship into a black hole where time passes much more slowly than it does on Earth. He fears that he may not see his young daughter again, which I could totally sympathize with. “Interstellar” is a religious epic full of metaphors, which reminds me of the finitude of human life trapped in time and space, and the absolute value of love. The only thing which weighs heavily on my mind is that the movie became a big hit with more than 9 million viewers in Korea, partly thanks to the educational enthusiasm of Korean parents who wish to teach their children about space science. It was a very Korean way of movie watching, which reflects the desperate desire of Korean parents to make sure that their children survive in the black hole of competition for college entrance no matter what. “Competition” was far and away the code of values that dominated Korea throughout 2014, which is tightly interlocked with the goal of unconditional

success. All the other values knelt down before it. According to a comparative study by Chang Duk-jin, a sociology professor at Seoul National University, the prime value in the Netherlands is tolerance, followed by competition. Competition ranks at the top in Germany and the United States, but it is tempered with equality, solidarity and tolerance. In Korea, competition is absolute. The problem is that in Korea the second most cherished value is success, a value that is practically synonymous with competition in the nation. Those calling for teaching children about tolerance were least found in Korea among the 62 surveyed countries. Such a winner-takesall obsession can hardly be found anywhere else in the world. Consequences of such extreme competition and greed are too gloomy. Korean children and adolescents’ happiness index ranks the lowest among the members of the Organization for Economic Cooperation and Development (OECD) for six consecutive years. Almost everyone in these age groups feel miserable. In the level of public awareness, Korea also ranks at the very bottom among the OECD members. Core elements of public awareness are common good, fairness, openness and democratic citizenship. Professor Chang diagnosed that our society’s lack of public awareness lies at the root of the Sewol ferry tragedy. We are not familiar with communal ethics that “We compete with each other, but we will come together to overcome our common fate at the final moment.” Competition can become a righteous value when competitors have this mindset. Here lies the very reason why the ferry disaster should not be dismissed as a tragedy to be endured by individuals but seen at a higher dimension as an incident to be collectively remembered by the entire society. In a similar vein, the “scandal of secret heavyweights manipulating state affairs,” which recently shook the nation, also stemmed from the deficiency of our society lacking public awareness. If the president’s hidden aides have indeed been involved in state administration, it is another glaring instance of selfish greed of individuals lacking the minimum requirement of public awareness and ridiculing the common good of the nation. Up to the moment the damp and shady power pointed its gun from behind a densely tinted window, where were our society’s values of common good,

fairness, openness and democratic citizenship sleeping? The “secret heavyweight” and the three senior presidential secretaries known to hold the “doorknobs” of her office are all under the allegation that they have been wielding power that was never relegated to them by the people. Article 1 of the Constitution of the Republic of Korea states, “The sovereignty of the Republic of Korea shall reside in the people, and all state authority shall emanate from the people.” If it is true that the “doorknob trio” have overstepped their authority, the Constitution has been reduced to a fake document that deceives the people. In Korea, the evolution of people from the objects of governance to citizens as the origins of sovereignty may have yet to be completed. It is not an easy process to attain a balance between public and private interests, and to stand upright as citizens who have internalized public spirit and morality. Europe and the United States underwent the rites of passage called the “citizens’ revolution” before the end of the 18th century, when we were still in deep sleep. Through the revolution, they obtained their license as citizens and emerged as the main players of sovereign power. How about us? We have the constitutional provision which declares that all state authority derives from us. In reality, though, the article jeers at us, saying that it has to be rewritten that “It is hoped that all state authority will emanate from the people.” No civilized institution of human beings is free. The French national anthem, “La Marseillaise” goes, “Liberté, Liberté chérie. Combats avec tes défenseurs!” The song overflows with the determination that “we will join forces for liberty without begging the Goddess of Liberty for freedom.” For the Koreans, who have no experience of a voyage comparable to the French Revolution, democratic citizenship and civil participation still feel quite awkward like somebody else’s clothes. Only after sailing the ocean of history, where hopes and sighs intermingle, without a pause, we will be able to possess our citizen’s license. President Park Geun-hye said, “My agonies will end only when I leave this world.” This is deemed an expression of her unlimited sense of responsibility for state administration, facing piles of tough issues. I hope that the president will get out

of the black hole of chaos and sail the ocean of history hand in hand with the people. Â [December 12, 2014]

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Underdeveloped Society in Handling Sex Crimes

A group of Seoul National University students hold a press conference to demand a through investigation of a professor accused of sexually harassing female students, on November 27, 2014.

Pyo Chang-won Director Pyo Institute of Crime Science

The Act on the Punishment of Sexual Crimes and Protection of Victims Thereof was enacted in 1994. This meant the abolishment of the concept of “chastity” under the Korean criminal law by ceasing to refer to “rape” and “indecent assault” as “crimes with regard to chastity.” Replacing the outmoded concept of “chastity,” Korean penal codes introduced the “right to sexual self-determination.” The “chastity” concept in Korea originated in the Three Kingdoms era from the teachings of “three obediences,” which obligated women to follow “three masters” (father, husband and son) throughout their lifetime. Confucian family ethics also worked to reinforce them. The “chastity” concept is “anti-humanitarian” as it treats (women’s) sex as a “family property.” Similar examples are “honor killings” still practiced in some Muslim states, where a woman accused of infidelity is killed by her father or brother. Another important aspect with regard to “sexual self-determination” hinges on how to define “sexual minor.” It involves protection of young people who are not old enough to properly practice their right to “sexual self-determination.” The concept of “sexual minor” has not been fully established in Korea. An adult who has sexual intercourse with a child under 14 can be punished for “statutory rape”

but evidence of “consent” by the sexual minor tends to reduce punishment. In many other countries which introduced the concept of “sexual selfdetermination,” the legal age threshold for “sexual self-determination” is about the same as the “age of consent for marriage.” Belgium, Switzerland, Britain, the United States, Canada, Australia and many other countries consider those younger than 16 as “sexual minor.” And the perpetrator of sexual intercourse with a person under 16 is subject to punishment, regardless of consent. Of course, the Korean legal system also has the Act on the Protection of Children and Juveniles from Sexual Abuse, which punishes those who sexually exploit children or juveniles by force or fraudulent means, or in exchange for financial and other returns. However, compared to the age of consent for marriage set at 16 (in case of parental consent) and 18 (without parental consent) under the civil code, Korean criminal law categorizes only those “below age 14” as “sexual minor.” It is no exaggeration to say that the Korean criminal law leaves juveniles aged 15 to 18 as a “sexual object” or “sexual game” without effective protection. As long as an adult over age 19 can elicit “consent” to have sexual relations with anyone 14 or older, it is legally permitted, outside legal control, investigation and penalty. It does not matter whether consent was elicited through unjust, foul temptations or deceit. The attitude of legal authorities also raises alarm. Recently, a representative of an entertainment management company, in his 40s, was indicted for sexual exploitation and violation against a 15-year-old middle school girl who wanted to be an entertainer. The Supreme Court found the male adult was not guilty because “mobile phone messages exchanged between the two indicated mutual affection and consent.” The judgment was grave neglect of the Act on the Protection of Children and Juveniles from Sexual Abuse. Recently, men who formerly served as vice minister of justice, speaker of the National Assembly or public prosecutor general, have successfully escaped indictment and punishment after having been accused of sexually exploiting and violating women who are as young as their own daughters or granddaughters. The chief of the Jeju District Prosecutors’ Office, who committed lewd public acts

in front of a high school girl returning home at night, also avoided indictment. The “backward” sexual attitude of the Korean prosecution and judiciary is not likely to change anytime soon. In Korea, rich and powerful perpetrators of sexual abuse and violence receive “legal” protection even though they objectify and commercialize women. The Korean judicial system protects their behavior by romanticizing them as in the novel “Lolita” or taking pity on their “virulent disease” caused by excessive occupational stress. Such protections are more palpable in cases involving the judges and prosecutors in possession of “the One Ring,” which allows them to violate the positive law and disregard the legislative intent in return for their service to power. Wealthy individuals who can exert influence over the legal authorities also benefit from such legal loopholes. Behind the solemn face that condemns the “four evils” of Korean society are the abominable orgies that condone sexual slavery and exploitation of young women. Still an underdeveloped country in handling sex crimes, the Republic of Korea is in need of urgent changes. [Kyunghyang Shinmun, December 10, 2014]

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- Olympic Games Shouldn't Leave Koreans Indebted

- A Tribute to Korean Fathers

- Time to Ban 'Reckless' Plastic Surgery

- Quality Tourism for Chinese Visitors

- Restoration or Destruction

Olympic Games Shouldn’t Leave Koreans Indebted

IOC coordination commission chair Gunilla Lindberg visits the Gangneung Ice Arena construction site along with organizers of the 2018 Pyeongchang Winter Olympics on January 15.

Jung Hee-jun Professor, Department of Sports and Leisure Studies Dong-A University

These days, countries that are preparing to host the Olympic Games try to reduce the number of stadiums that need to be built and minimize the environmental impact through negotiations with the International Olympic Committee (IOC). In contrast, the Pyeongchang Organizing Committee for the 2018 Winter Olympics insists on constructing an unnecessary building and destroying a forest of rare trees that has been preserved for over 500 years for a three-day ski event. The committee claims it cannot resist requests from the IOC. On December 8, the IOC said that Olympic host cities may move events to other towns or even to other countries, but the Pyeongchang committee rejected the suggestion. It has also been learned that even though the IOC was ready to negotiate on construction of competition venues, Pyeongchang had done nothing. Moreover, the Pyeongchang organizers have insisted it must construct a huge, costly building that is unlikely to be utilized after the games “because the IOC demands it.” The committee argues that it cannot accept the IOC proposal to transfer games to other places because the construction for all games venues has already started, but the argument is hardly persuasive. Construction of games venues has just

recently started. The ground is still being dug up at some sites. Even worse, in response to questions regarding the post-games utilization and operating cost of the building to be constructed, the committee said it would dismantle the building if it cannot find ways to utilize it. It is difficult to understand how the committee can so easily say that it would dismantle the building, which will cost hundreds of billions of won to construct. Removing the building will cost an additional huge sum of money. I cannot but feel the committee is testing the patience of taxpayers. When Pyeongchang bid a third time for the right to host the Winter Olympics, Korean people enthusiastically supported the city, and when it finally succeeded in its bid, everyone rejoiced together. At the time, the organizers claimed that “everything is ready.” However, they are now pestering the central government for state funds. It remains to be seen how they will cope with criticism that the Pyeongchang Games are a mere project to secure government subsidies and raise land prices in the region. Gangwon Province presented rosy prospects when bidding for the right to host the Winter Olympics. However, many experts warned the reality was different. The Russian city of Sochi spent a staggering US$51 billion in hosting the 2014 Winter Games, scaring away potential bidders for the 2022 Winter Games. Cities in the Ukraine, Sweden, Poland and Norway say they will not submit a bid in 2016, when the IOC selects the host city for 2022. Oslo was considered a strong potential contender. Its withdrawal came in spite of the IOC’s commitment to contribute $880 million to the games. “Profitable Olympic Games” no longer exist. Hosting the Olympics is a money loser without doubt. And the scale of loss is beyond imagination. In the wake of the 2004 Athens Olympics, the prime minister of Greece told reporters that the deficit was so large that he could not calculate it. When the 2010 Winter Olympics ended, Vancouver estimated its deficit would be around $1 billion. A year later it confessed that the deficit amounted to $10 billion. It is never too late to consider moving some competitions to other countries. Some argue that in view of the anti-Japanese sentiment in Korea, it would not be possible to share the games with Japan. But I believe that it could provide

momentum for Korea and Japan to be born again as good neighbors. And Korea may further host some events of the 2020 Tokyo Olympics. Gangwon Province will thus become a pioneer in creating a new model in the Olympic history. Never leave massive debt on future generations with the excuse of hosting the Olympics. Â [Dong-a Ilbo, December 15, 2014]

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A Tribute to Korean Fathers

The movie "Ode to my Father" has triggered a surge of memories about the backbreaking years following the Korean War as well as the ideological debate over contemporary Korean history.

Kwon Soon-hwal Editorial Writer The Dong-a Ilbo

A movie that I wanted to see was released yesterday. It is "Ode to My Father" (its Korean title is "Gukje Sijang" referring to Gukje Market in Busan) directed by Yoon Je-kyoon and starring Hwang Jung-min and Kim Yun-jin. After I watched its teaser trailer and production notes on the Internet, I decided to go see it. The film tells the "greatest story about the most ordinary father." It depicts the lives of the protagonist and those around him during a turbulent period from the outbreak of the Korean War in 1950 to present day. It was his sense of responsibility for his family that sustained him in the tough world. "When we were poor and had a hard time, we always felt sorry for our father who'd lived for his family, not for himself, all his life. I made the film to express our gratitude to the generations of our grandfathers and grandmothers and our fathers and mothers," Yoon, a veteran film director in his mid-40s, said. Hwang Jung-min's character, Deok-su (the protagonist), is separated from his father during an evacuation from Hungnam Port in North Korea during the Korean War and reaches Busan. He takes the responsibility for his family in his early teens, while remembering what his father told him, "You, the eldest son, are

the head of the family when I'm absent." During the war, he begs American GIs for chocolate, shouting, "Chocoretto, give me!" He goes to West Germany as a miner to make money in the 1960s and to Vietnam as a civilian engineer in the 1970s, putting his own desires on the backburner. He arrives at old age after living a life in which he always thinks of his family first. Quite a few lines in "Ode to My Father" strike a chord in our hearts. Deok-su says to his wife (Kim Yun-jin's character), a former nurse who worked in West Germany, "Well, this is what I think. It was fortunate that we, not our children, were born during tough times and have since suffered worldly hardships." Looking at his father's photo, his old-age character says with sobs, "Father, I've kept my promises to you well. I have a life lived well, don't I? But it was really, really difficult." I felt the weight of life the character has to carry as the breadwinner of his home. Why did they choose Gukje Market as the film's title and its main setting? Producers said, "We tried to figure out how to pay a tribute to our parents' generation. We considered Gukje Market the most appropriate title and setting, given that it's where refugees from North Korea once made a living and where ordinary people are still nurturing their simple dreams and harboring their hopes." Many people said they shed tears with their hearts deeply touched while attending a preview of the movie or watching its trailer. Even young people who have no idea about how difficult the past was, as well as those who experienced extreme poverty themselves, said, "I came to feel thankful to our country and older generations." Wieland Speck, head of the Panorama section of the Berlin International Film Festival, formally invited "Ode to My Father" to the Berlin festival slated for February. "Ode to My Father" is an excellent depiction of Korea, which has achieved unprecedented development by overcoming national division and a turbulent modern history, with solemn cinematographic touches and human warmth, he said. The breadwinner responsibility that Deok-su assumes during the era of industrialization is not so different from that of today's fathers. The only

difference is that today's fathers did not have to start from scratch thanks to the economic development that earlier generations had achieved through dedication and sacrifice. But the keywords for today's fathers and mothers, including baby boomers born between 1955 and 1963, are the same love and sense of responsibility for their family, aren't they? Â At the threshold to the New Year, promotion announcements are carried on newspapers, while many fathers are leaving their jobs silently. Amid slow economic growth and poor corporate performance, more people have lost their jobs than before. The family is the last pillar of hope that we can lean on when we have a hard time. Fathers are in dire need of support and encouragement, as they feel chilly all the harder this winter. Â [December 18, 2014]

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Time to Ban 'Reckless’ Plastic Surgery

A woman passes by an ad for a plastic surgery clinic at a Seoul subway station in this file photo dated March 25, 2014.

Editorial The Chosun Ilbo

A 21-year-old female college student died while in a coma at a plastic surgery clinic in Seocho-gu, Seoul on December 19. She was recovering from four hours of plastic surgery to trim her jaw bone. The exact cause of her death will be revealed by a police investigation. But it is sad to see another victim of the cosmetic surgery industry that has turned into a "factory assembly line." According to doctors, some large plastic surgery clinics in the Gangnam area have such an "industrial" division of labor among surgeons that it is almost hard to tell whether they are manufacturing assembly lines or medical clinics. Scores of doctors are given assignments each day to perform a set number of procedures on designated parts of each patient's body. Timers are installed in operating rooms to remind doctors that they have to finish a double eyelid procedure within half an hour, an eye reshaping operation within an hour, and a nose job within two hours. Some clinics perform several operations simultaneously and even use consulting rooms to operate on patients. Aggressive marketing restocks the assembly lines. Subways and buses are inundated with cosmetic surgery ads. As a result of such daredevil advertising, the cosmetic surgery industry in the country is scaled at a staggering 5 trillion won per year, accounting for about a quarter of the global market value of 21 trillion won. Korea ranks first among nations in the world in terms of the per capita rate

of cosmetic plastic surgery, with 131 cases per 10,000 people. Â Any medical practice that fails to give top priority to patient safety can hardly be called medical service. The Korean Society of Plastic and Reconstructive Surgeons decided in April to refrain from advertising in public places like subway stations, but to no avail. We can no longer afford to wait indefinitely until doctors voluntarily refrain from their reckless practices at a time when an increasing number of patients are dying. It is high time to place tough regulations on technical standards for facilities of plastic surgery clinics and impose strict legal requirements on the qualifications of surgeons and strengthen systems to make them more liable for any damaging side effects of surgery. Â [December 22, 2014]

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Quality Tourism for Chinese Visitors

A group of Chinese tourists pose for photos in front of the main through hall at Gyeongbok Palace in Seoul on January 1.

Chae In-taek Editorial Writer The JoongAng Ilbo

“The war to help Koreans fight against the Americans (what the Chinese call their intervention in the 1950-53 Korean War) began with South Korea’s invasion of the North. American occupation of the North was prevented thanks to China’s defeat of the invaders.” “South Korea insists Goguryeo [37 B.C.-A.D. 668] is part of its history even though it is clear that the ancient kingdom had been a part of greater China. South Koreans are the best in the world for cooking up history in their favor.” These are not remarks from Chinese ultra-nationalists involved in history distortion or anti-Korean groups. They were uttered unreservedly in the streets of Seoul to Chinese tourists. Anyone who makes such statements would have been chastised if any Korean passersby understood Chinese. A licensed Chinese-speaking Korean at a tourist company strongly protested the remarks, which came from an unlicensed Chinese guide in the same company. But the guide shrugged off the complaint, saying his job was to please his clients and not to educate them about history. The Korean eventually quit the company and is looking for another job. He said there are an increasing number of Chinese who speak both Korean and Chinese

and are working as tour guides. These unlicensed guides often introduce themselves as Korean to Chinese tourists. Therefore, when the Chinese tourists return home, they may tell their friends that South Koreans admit they invaded North Korea and Goguryeo was part of China. China has replaced Japan as the biggest source of visitors to Korea since the country began compiling relevant data in 1961. Chinese tourists to South Korea, known as “youkers,” totaled 3.92 million last year, compared to 2.72 million Japanese tourists. Tourism, however, is not just about the number of visitors and revenue. It can help promote cultural and human exchanges and improve mutual understanding between nations. Hence tourism is even deemed civilian diplomacy. Last weekend I was passing by Gyeongbok Palace when a group of Chinese tourists stepped out of a bus along the sidewalk. The guide was saying something and I assumed he was explaining about the palace. I asked my companion who speaks Chinese what the guide was saying. My companion, who had previously worked for a travel agency, said the guide was saying that Gyeongbok Palace was “too small and shabby in comparison to the Forbidden City in Beijing and not worth spending too much time touring it.” He then hurried the group to move on to the next stop. My companion said that he believed the group would head to Sinchon and shop for health food like ginseng and cosmetics in a shopping mall exclusively for Chinese. He said they would spend a lot of time at the shops because the tour guides and companies receive commissions based on the amount of money the Chinese tourists spend there. Some unlicensed guides force tourists to make purchases, saying they will leave them and go home unless each tourist buys more than 10 items. Because the Chinese traditionally try not to be rude to others, the tourists make purchases to help the guides save their face. Such unpleasant experiences are one of the reasons behind the low rate of revisits by Chinese tourists. A recent survey showed that just 29.7 percent of Chinese tourists said they want to visit South Korea again, compared with 64 percent among Japanese tourists.

An experienced tour guide said that although the youkers are known to be solely interested in shopping, many of them are very interested in culture and history. He said that travel agencies need to improve their tour programs and better educate their guides. Good manuals and guidelines need be prepared on diverse subjects from Korean history to modern lifestyles, and tour guides need be given sufficient education to give well-informed explanations about Korea. The quality of tourism is closely connected to national dignity and prestige. It is time to introduce special measures to do away with low-quality tourism. Â [December 4, 2014]

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Restoration or Destruction?

Sajikdan, the state altar of the Joseon Dynasty dedicated to the gods of land and grain, located in central Seoul, is government-designated historic monument.

Kang Seong-min CEO Geulhangari (Bookpot Publishers)

Halfway through his reign Prince Yeonsan began to abuse his powers as a monarch. He squandered the state resources on luxuries, hunting, parties and philandering. He engaged in all sorts of vulgarities and obscenities under the intoxicating influence of liquor and asked his aides the next morning whether he had not erred while drinking. The answer was always and unanimously “no.” In those days people would “call a deer a horse,” as the Chinese saying goes, according to the king’s will. Of all the acts of tyranny by this notorious 15th century ruler of Joseon, the most outrageous was the demolition of private homes near the palace and forceful relocation of their owners. He wanted complete freedom from disapproving eyes of his subjects so that he might freely undress the court ladies serving him and party to his heart’s content. In his eighth and ninth years on the throne, Prince Yeonsan ordered the destruction of 100 private houses near Changdeok Palace, Sungkyunkwan (National Confucian Academy) and Jeongeopwon (residence of female Buddhist monks). Not stopping there he eventually ordered the demolition of one hundred houses near Jasu Palace and Suseong Palace, reasoning that concubines of the late king

resided there. Another hundred houses at the foot of Mt. Tarak were razed and their occupants kicked out. His goal was to get rid of all the private homes within view of the palace or located near the palace walls, and to keep all people out. Some government officials courageously appealed that “the displaced people without a place to go have resorted to building makeshift shacks along the streets. Their resentment and suffering are great.” Prince Yeonsan merely responded by depriving his subjects of the freedom of speech. Such is the description of the tyrant in the book “Prince Yeonsan” (Yeonsangun), written by Kim Beom based on his extensive research and meticulous checking for historical accuracy. The book was brought to my mind by the controversy over the proposed restoration of Sajikdan, the state altar of the Joseon Dynasty. The Cultural Heritage Administration is harboring a grandiose plan to restore Sajikdan into its original scale and shape, and to build a village of traditional Korean-style houses in the neighborhood. This plan, however, requires the removal of residents of the site, who have grown up together and become a part of the local history and culture. Restoration of the historical site without any deference to the present history of here and now is itself an annihilation of history and culture. It will also create a huge cultural and historical vacuum at the heart of the restored site. Among the buildings that would be demolished are the Sajik Children’s Library, the nation’s oldest library for children which opened 50 years ago, the Jongno Public Library and Maedong Elementary School. Over the longer term, the restoration of the Seoul Fortress walls will take down a greater number of houses and displace residents, which may end up forcing out the last breath of what used to be a vibrant neighborhood community. In their place, ceremonious rituals reenacted with traditional costumes and music will be packaged as a tourist product, and the restored altar will attract a swarm of visitors. Some of them will include tourists from China, the home of the Sheji, the state altar for the gods of grain and land, and perhaps they may enjoy the proud satisfaction of seeing this miniature representation of their own culture implanted in a foreign land.

It must be pointed out that the promoters of the project have arbitrarily interpreted history and culture to their own interests and objectives, while turning a blind eye to the lives of the current occupants of the site. They have refused to meet opponents of the project, offering little more than the standard line, “Nothing’s been decided yet.” The project must be stopped. The residents are enraged by the utter disregard for their right to their place of residence. They are suffering from extreme anxiety and stress with the knowledge that the project which was unilaterally announced and imposed on them without consensus-building will soon begin. As Dr. Cho (Han) Hae-joang points out, it may end up being “a construction project riding on nationalism” and “a project that may raise property prices nearby while depleting state coffers.” To prevent those scenarios, the government must engage in sincere dialogue with the affected residents. Annihilating history to resurrect another history in its place is a fallacy that makes no sense, because history is something that accumulates over time and not something that can be built up. If the government had funds for such an illconceived plan, it would be wiser to divert the money to correcting the mistakes in the translation of The Annals of the Joseon Dynasty. [Seoul Shinmun, December 18, 2014]

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- Korea's Trade Growth and Current Trends

- Economic and Business Keys of 2015

Korea’s Trade Growth and Current Trends Chang Sang-sik (Austin Chang, Lead Author) Research Fellow, Institute for International Trade Korea International Trade Association

In 2014, Korea’s external trade reached US$1 trillion for the fourth straight year with its total trade volume expected to hit a record high, well above that of 2011. Robust performance by small and medium-sized enterprises (SMEs) and additional free trade agreements (FTA) enabled an all-time high in exports despite unfavorable internal and external conditions. Buoyant export performance is expected to continue, easily maintaining Korea’s position as the world’s seventhlargest exporter. Since the foreign exchange crisis of 1997, trade has powered the Korean economy, creating jobs, boosting productivity and raising income as the nation piled up surpluses of about $400 billion. While the main exports have been manufactured products, Korea is now seeking to broaden the scope of its exports to more cultural content and brand goods. Amid intensifying competition with advanced economies and the tough challenges posed by emerging markets, it would be best if Korea employs a “Two PMs” strategy (New Player, New Product, New Market, and New Method) in preparation for an era of $2 trillion in annual trade volume.

1. All-time Highs Expected in 2014 Korea’s trade crossed the $1 trillion milestone in 2011, but a global slowdown soon hampered momentum. The annual trade amounts in 2011, 2012 and 2013 were $1.079 trillion, $1.068 trillion and $1.075 trillion, respectively. They were recorded in the first 10 days of December in each year. This year the milestone was reached on November 28. In short, it took 11 months for Korea to reach the $100 million mark in exports in 1964 [when December 1 was designated as Export Day to celebrate marking $100 million in exports for the first time], but now it takes just 1.6 hours. Over the past five decades, Korea’s trade has made notable strides in the number of export items and trading companies, and per capita export value. Since 2010, 77

Korea has been the world’s seventh-largest exporter with its trade volume climbing 10.3 percent annually, above the global average of 6.7 percent. Aided by steady increase in its international commerce, Korea’s share in global trade has risen some 40-fold in 50 years. It was 0.07 percent in 1964, and rose to 0.53 percent in 1974, 1.32 percent in 1983 and then to 2.97 percent in 2013.

2. Major Achievements in ‘Three 4s’ With its trade volume exceeding $1 trillion for the fourth consecutive year, Korea’s ranking in global trade is likely to rise to 8th place in 2014 from 9th in 2013. Among the countries trading more than $1 trillion, Korea enjoyed a trade surplus for four consecutive years and also retained its title as the 4th-largest trade surplus holder, following Germany, China and the Netherlands. Among the world’s top 10 traders, Korea, Germany and China are the only countries that have accumulated trade surpluses by relying on manufacturing goods rather than raw resources and re-imports and re-exports.

From January 1998 through October 2014, Korea’s accumulated trade surplus reached $400.5 billion, which allowed the nation to secure enough foreign reserves to cushion the impact of external financial shocks. As of the end of October 2014, Korea’s foreign exchange holdings amounted to $363.7 billion, becoming the world’s 7th-largest holder. Korea is also steadily closing the gap with Russia, Taiwan and Brazil, the countries immediately ahead of Korea in terms of foreign exchange reserves holdings.

3. Strong Performance by SMEs Korea’s trade performance in 2014 was driven by brisk exports by small and medium-sized companies, a welcome sign that Korea has finally broken away from its dependence on a handful of popular items that large conglomerates sell. Korean conglomerates have so far accounted for two-thirds of the nation’s total export value. In 2014, however, exports by SMEs increased at a higher rate than that of large companies. From January through September 2014, SME exports recorded a 5.7 percent year-on-year increase, higher than Korea’s total export growth rate (2.9 percent), greatly contributing to the nation’s solid export performance. Accordingly, the share of SMEs in Korea’s total external trade rose from 33 percent in 2013 to 33.7 percent in 2014, whereas the share of large companies decreased from 66.8 percent to 66.1 percent. The leading export items of SMEs were auto parts, general machinery, textile goods and precision chemical products.

4. Significant Contribution to Job Creation Korea’s export companies are outpacing local operators in terms of job creation, productivity and wage levels. In terms of job creation, during 2006-2012, the number of workers employed by export companies increased by 216,000, or 33.3 percent, while jobs created by domestic-oriented companies rose by 160,000, or 8.7 percent. During the corresponding period, the number of full-time employees at export companies increased by 202,000, surpassing 156,000 more workers hired by domestic market-oriented companies. These numbers suggest that

Korean export companies are making a significant contribution to job creation. In productivity, as of 2012, the per capita sales of export companies amounted to 1.04 billion won (approximately $970,000), more than double that of companies focusing on the local market (440 million won, or approximately $410,000). During 2006-2012, the per capita turnover of export companies increased by 57.2 percent, in comparison to a 34.2 percent increase at domestic market-oriented companies. In wages, as of 2012, the per capita income (salary, severance pay and welfare expenses included) at export companies averaged 7.3 million won ($68,000), or 1.6 times more than that of workers at local operators (4.7million won, or $44,000). During 2006-2012, employees at export companies saw their wages increase by 43.7 percent, higher than a 26.5 percent raise at domestic-oriented companies.

5. Diversification of Export Portfolio Korea has become a global provider of various products based on its technological prowess and high-quality production capability. Korea has been a powerhouse in global sales of IT products such as smartphones, home appliances, automobiles, machinery, and parts and materials. In terms of exports, as of 2012, Korea was the second-largest exporter in shipbuilding. Meanwhile, it ranked third in steel, forth in communication equipment and semiconductors, and fifth in automobiles (Source: UN Comtrade). In terms of the share in the global smartphone market, Samsung accounted for 23.8 percent, followed by Apple with 12 percent, Xiaomi with 5.3 percent, Lenovo with 5.2 percent, LG with 5.1 percent, and others with 48.6 percent, respectively (Source: ICD). In the UHD LCD panel market, Taiwan’s Innolux was the largest share holder with 32.8 percent, followed by Korea’s LG with 28.3 percent and Samsung with 17.9 percent, Taiwan’s AUO with 8.2 percent, and China’s Chinastar with 7.0 percent, respectively (Source: Display Search). Recently, Korea has succeeded in diversifying its export portfolio. As Korean goods have been increasingly recognized for their quality and design, the scope of major export items has extended from manufactured products such as automobiles, ships, smartphones and semiconductors to cultural content, owing

to the hallyu craze for popular culture, and brand goods. As the popularity of Korean pop culture such as TV dramas and K-pop has spread beyond China and Southeast Asian countries, Korea’s cultural contents and other Korea-related products are drawing broad interest across the globe. Recently, the export growth rate of cultural products has surpassed that of manufactured goods. The year-on-year export growth of manufactured goods was -13.9 percent in 2009, 28.3 percent in 2010, 19 percent in 2011, -3 percent in 2012, and 2.1 percent in 2013. Meanwhile, the exports of cultural content grew year-on-year by 16.6 percent in 2009, 22.3 percent in 2010, 34.9 percent in 2011, 7.2 percent in 2012, and 10.6 percent in 2013, respectively. As Korea’s food products and cosmetics have succeeded in appealing to the taste of global consumers, their exports have also been surging.

Korea’s restaurant chains that have gone global have helped local markets become familiar with Korean cuisine as well as Korean culture. Korean coffee shop chains that are operating in China have been taking the lead in the exports of coffee combined with related service products. With the global restaurant industry showing solid growth, exports of Korean restaurant chains have bright prospects for growth in that they also have the export-inducing effect on their subcontractors providing shop interior design, store management software and other services.

6. FTAs with 52 Countries Through active free trade negotiations with its partners since the turn of the century, Korea has signed FTAs with 52 countries as of 2014. Korea is the only country that has FTAs with the four major global trade blocs: the United States, the European Union, China and the ASEAN. Consequently, Korea has expanded its economic footprint to 73.5 percent of the world’s GDP. The import market of Korea’s 52 FTA partners is worth $13.3 trillion, equivalent to 71.2 percent of the entire global market. With a population of 4.3 billion, the combined markets of Korea’s FTA partners account for 60.3 percent of the world population. In particular, the China-Korea FTA, concluded mostly recently, is expected to serve as a stable foothold when Korean companies make inroads into the Chinese market, and also as a new growth engine for the Korean economy as a whole.

7. ‘Two PMs’: Success Formula toward $2 Trillion in Annual Trade Korea needs to introduce the “Two PMs” strategy ― New Player, New Product, New Market, and New Method ― in preparation for an era of $2 trillion in annual trade by 2020. There is growing concern that Korea’s competitiveness will be squeezed between the advanced and emerging economies. It is therefore desirable for Korea to map out a new trade strategy. First, Korea needs to encourage more domestic market-centered companies to transform into export companies. The global competitiveness of the nation’s SMEs should be enhanced to help them develop new markets. If the number of SMEs increases by 10,000 by 2017, it will have the potential effect of generating exports worth $20 billion (given that individual company’s exports average around $2 million.) 87

Second, Korea needs to develop new export items through its service sector such as cultural content, medicine and software development, as well as the gentrification of export items by merging trade with culture. Third, Korea needs to strive continuously to broaden its strategic export markets ― including expansion of overseas markets and development of emerging markets ― through conclusion and utilization of FTAs. Last but not least, Korea also needs to devise a global export marketing strategy by exploring more online business opportunities such as B2B (business-tobusiness) and B2C (business-to-consumer). [Trade Brief, December 2014, Institute for International Trade, Korea International Trade Association]

www.koreafocus.or.kr

Economic and Business Keys of 2015 Lee Jun-hyup (Lead Author) Research Fellow Hyundai Research Institute

I. Introduction Anticipating what lies ahead for the domestic economy and business community in the New Year, Hyundai Research Institute has chosen 10 keys for 2015. They include events such as Korea matching Japan’s per capita GDP, issues like repercussions from Korea’s rapidly aging population, and disruptive trends including shopping at overseas online malls, which is squeezing domestic distributors and manufacturers. In addition to the 10 keys, inter-Korean relationship was picked in view of the importance of laying the foundation for peaceful reunification.

II. Ten Plus One 1. Korea’s Per Capita GDP Matches Japan’s In the 70th year since its liberation from Japanese occupation, Korea will see its per capita GDP (in terms of purchasing power parity) rise to the level of its former colonial ruler, making it a major economic power in the true sense. In 2015, the per capita GDPs of Korea and Japan will likely be $38,760 and $39,108, respectively. Barring major setbacks, Korea’s per capita GDP should top $39,800 in 2016, exceeding that of Japan. Whereas Japan will remain mired in low growth, Korea’s growth rate will be relatively higher, widening their difference in growth rates. Japan’s average economic growth rate from 2010-2013 hovered in the 0-percent range, while Korea’s growth rate averaged 3.3 percent. The IMF and the OECD have put Japan’s economic growth at 0.8 percent. Hyundai Research Institute forecasts 3.6 percent expansion for Korea.

Korea’s current account surplus has recently surpassed Japan’s. When a nation’s current account surplus expands through strong exports, it helps boost economic growth by lifting national income and employment and helping stabilize financial markets. In the past, Japan’s current account surplus far exceeded Korea’s, but the situation reversed sharply in 2013 when Korea registered a surplus of $79.9 billion, more than double Japan’s $33.6 billion. The IMF predicts Korea’s surplus will be about $90 billion in 2015, compared with Japan’s $54.9 billion. However, Japan is above Korea in OECD’s “better life index.” Korea ranks below Japan in employment, community, environment, leisure, and income (in terms of assets plus disposable incomes).

Suggestions: To maintain economic growth, Korea will need to increase its growth potential, which has recently fallen to the 3-percent range. Economic reforms, more investment and continued push for a creative economy should be on the agenda. Quality of life also needs to be upgraded to a level that better reflects income levels. This will involve better social conditions such as environmental and safety improvements and promotion of community spirit to foster social capital. 2. Arrival of the ‘ChiKorea 2.0 Era’ The “ChiKorea (China,Korea) 2.0 era” will begin as their partnerships in politics and diplomacy are strengthened, complementing the close economic cooperation that has been the basis of their bilateral relationship. In the new era, the strategic cooperative partnership of Seoul and Beijing will strengthen to create a regional community. The two neighbors will jointly cope with regional problems in political and diplomatic areas through active dialogue, seek both quantitative and qualitative development in economic and trade areas, and expand people-to-people exchanges. 91

Korea and China have set a bilateral trade goal of $500 billion and mutual investment of $10 billion on the back of their new free trade agreement and other forms of cooperation. In 2013, their bilateral trade totaled $228.9 billion and mutual direct investment amounted to $5.58 billion. The FTA and other channels will shift the focus of trade from intermediary goods to finished products. The investment climate also will change from simple manufacturing to higher value-added manufacturing and service industries. The scale of bilateral human exchange is also expected to expand, and the trend in cultural exchange is foreseen to improve in quality as well. Riding on the crest of hallyu fever, Chinese people’s visits to Korea have boosted the total number of Korean and Chinese arrivals in each other’s country to 8.3 million as of 2013. The scale and quality of bilateral exchanges are expected to continue to improve, given the expansion of mutual cultural exchange as well as the diversification and sophistication of content exchanges. Drawn by Korea’s vibrant popular culture, Chinese visitors already are flocking to Korea.

Suggestions: In the ChiKorea 2.0 era, a joint pursuit of diverse means of cooperation will be needed to enhance the two nation’s diplomatic cooperation in Northeast Asia as well as ensure macroeconomic stability. They should not only make efforts to reopen multilateral talks for denuclearizing North Korea but also

build a consensus on the need to jointly address Japan’s misguided perception of historical issues. 3. Spotlight on Consumption for Growth Korea increasingly needs to get out of export-led growth. More attention should be put on raising household income, which can lead to a virtuous cycle of boosting consumption, production and investment. Higher household income would resolve the problem of sluggish aggregate demand, the main reason for the current business slump, and thus bolster economic growth. In this regard, two outstanding issues will need to be addressed: household income growth not matching increases in gross national income and unbalanced income distribution. The growth rate of household income has lagged behind that of gross national income since the 1990s. As a result, the share of household income in GNI fell from 72.1 percent in 1980 to 61.2 percent in 2013. Private consumption’s contribution to economic growth also fell 4.6 percentage points year-on-year on the average during 1981-1990, 3.1 percentage points during 1991-2000, and 1.9 percentage points during 2001-2013. Better income distribution would widen the consumption base. Korea has a thin middle class and private consumption is concentrated in the high-income class whose average propensity to consume (APC) is relatively low. That naturally pulls down the nation’s overall APC. The rate of increase in consumption is lower than the GDP growth rate and private consumption constitutes a low share against GDP. These problems need to be resolved to push Korea forward to advanced economy status.

Â Suggestions: To help increase household income, the government needs to create more quality jobs and enhance support to increase the income of lowincome households. The government needs to provide jobs for youth, women and middle-aged people through active job-matching services. For instance, it has to match college education with demand of industries, increase day care facilities to assist working mothers, and strengthen steps to help retired workers find jobs. To help low-income people make the most of EITC (earned income tax credit), the government needs to correctly understand their income levels, which

determine who benefits from the system. 4. Rebalancing Export Mix Sluggish global economic conditions are widening the difference in growth rates among nations. Subsequent consumption changes are expected among world markets As the global export markets and manufacturing’s labor structure reorganize, Korea’s export portfolio also faces a major change. The narrowed technological gulf between developed and developing countries has prompted a reorganization of the manufacturing sector’s division of labor. That could result in major changes in Korea’s export of raw materials and capital goods. The recent conclusion of FTAs with Australia, Canada and China are also expected to influence Korea’s exports of consumer goods. By country, Korea’s exports to the United States and ASEAN will likely increase; by item, the IT industry will see particularly brisk foreign shipments; and by the type of products, shipments of raw materials and capital goods are expected to rise. Since the 2008 global financial crisis, Korea’s exports to the United States and the Association of Southeast Asian Nations have increased, while those to Japan and the EU have declined. The U.S. economy’s relative recovery has stimulated Korean exports to the United States. Meanwhile, ASEAN has emerged as an alternative manufacturing base to China, attracting Korean exports. Export increases to U.S. and ASEAN markets are expected to continue through 2015.

As the global demand for Korea’s seven major export industries declines, changes in the export items are inevitable. Although the global import demands for IT, automobiles, machinery and petrochemical goods continue to increase, their growth rates have slowed considerably. Global demand for petroleum goods, shipbuilding and steel, is in decline, pulling down the nation’s exports as well as their ratios in total exports. As the center of global manufacturing production shifts from China to ASEAN, Korea’s exports of raw materials and capital goods are being reorganized with ASEAN taking the center stage. While Korea’s exports of raw materials and capital

goods to China have plummeted compared with the early 2000s, the growth rates of these exports to ASEAN have shown relatively slower declines. Also, since the conclusion of the Korea-ASEAN free trade agreement, foreign direct investment to the ASEAN region has drastically increased. That may also raise exports of raw materials and capital goods to the region. Meanwhile, when the Korea-China FTA goes into effect, there is a possibility that the exports of consumer goods to China will sharply increase.

Suggestions: For Korea to increase its share in global export markets, it will need to rebalance not only its export portfolio but also product portfolio while making efforts to sharpen overall industrial competitiveness. Particularly, Korea needs to identify and nurture new export growth engines that can replace the current seven major industries. 5. Transformational Overseas Online Shopping

Korean consumers’ online purchases of goods from abroad and attendant delivery needs are fueling a revolution in consumption and distribution. Consumers are benefitting because they are getting better deals overseas than they can find in Korea. But that naturally is putting pressure on Korean manufacturers and retailers. In 2010, purchases from foreign websites totaled $274 million. In 2013 it hit $1.04 billion, a four-fold increase in just three years. By item, clothes and footwear accounted for 30 percent, followed by health food with 15 percent, cosmetics, 8 percent, and bags, 7 percent.

By shopping on overseas websites, Korean consumers have found famous foreign brand goods at relatively cheaper prices. That is increasingly worrisome for domestic distributors and manufacturers. There is a very wide gap between the competitiveness of foreign Internet shopping malls like Amazon and domestic distributors. And domestic manufacturers also have to compete with their foreign counterparts in the Korean market. In the past, Korean importers sold to domestic consumers at exorbitant prices. Now they are feeling the pinch instead. They are being forced to reduce their prices to stay competitive. Likewise, large Korean exporters are cutting prices at home. Previously, their goods were cheaper abroad than in Korea. 99

As the range of direct purchases expands to clothes, cosmetics and even to medical goods, the barriers between the domestic and overseas markets are being dismantled. Therefore, if consumers spend their income abroad, increase in consumption may not actually correlate with domestic production and investment. Suggestions: As the consumption paradigm changes along with the fast increase in overseas direct purchases, the government will need to devise ways to sharpen the nation’s industrial competitiveness, improve distribution systems, and bolster legal protections for consumers who buy directly from abroad. In particular, the government should provide policy support to foster small but strong businesses that can beat foreign rivals in both distribution and manufacturing. Related agencies need to improve distribution by resolving problems with international ecommerce infrastructure, such as export platforms, logistics and customs clearance. They also should make the shopping trend two-way by enabling foreigners to buy from domestic Internet shopping malls with ease. 6. New Employment Paradigms The paradigms of the domestic employment and labor markets have begun to change under the influence of the changing structures of the economy, demographics and industry, as well as subsequent shifts in government policy. Sluggish corporate investments and slower growth have significantly weakened job creation. The nation’s rapidly aging population is shrinking the core of its workforce (aged between 25 and 49), which will lead to labor shortages. Moreover, the realignment of the industrial structure to promote service industries and policymakers’ increased push for flexible work schedules are expected to accelerate a shift in employment paradigms. Despite slower growth due to suppressed consumption and investment, the number of employed people has increased substantially. From the 1970s to the 2000s, employment dropped faster than economic growth (“growth without jobs”), but since the 2010s, employment has expanded despite a sharp fall in growth (“jobs without growth”). The elasticity of employment fell from 0.41 point in the early 1970s to 0.22 in the 2000s. Since the turn of the 2010s, the comparable figure surged to 0.60, the highest level since the government started

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compiling related statistics. As the economically active population shrinks and the baby-boomer generation (born from 1955 to 1963) retires, Korea will likely face labor shortages in the 2020s. As the industrial structure shifts toward services, the employment structure will also change in that direction. The number of workers in the service sector rose from 5.06 million in 1980 to 17.81 million in 2014, pushing up the portion of service workers from 37.0 percent to 69.6 percent of the nation’s total labor force. In particular, female workers, a vulnerable group in employment, took up service jobs in large numbers, making up the bulk of employment.

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Suggestions: Korea will need to ensure not only the quantitative but qualitative improvement of its labor markets, work out preemptive measures to meet the looming labor shortages, and improve working conditions for women in the service sector. Only when the nation devises policies to cope preemptively with the changing employment paradigms can it create a virtuous economic circle. 7. More Home Buying As home rents rise steeply and housing oversupply continues to decline, the market situations in Seoul and Gyeonggi Province will improve, prompting an increasing number of renters to become home buyers. The “traditional housing market mechanism” (rising rents lead to rising home prices) collapsed in metropolitan Seoul in the aftermath of the global financial crisis. Home prices softened despite a steep rise in rents. The fall in home prices was due to weak demand and imbalance in the demand and supply of rental homes. Outside of metropolitan Seoul, however, soaring rents ignited a surge in housing prices. The housing market mechanism has recently shown signs of recovery in the

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capital area as a result of a record-high price-rent ratio and the declining number of unsold apartments (condominiums) in 2014. Chances for a housing rebound are high in 2015. Â

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In May 2001, the price-rent ratio of apartments in Seoul metropolitan area shot to an all-time high at 66.9 percent, turning around housing prices and putting them on an upward trend. The price-rent ratio of apartments in Seoul metropolitan area in November 2014 topped the 2001 record with 67 percent and the ratio will very likely rise further in 2015. Moreover, a variety of government policies has curbed housing oversupply in metropolitan Seoul since October 2013. The number of unsold apartments in the Seoul metropolitan area fell steeply from 36,542 in October 2013 to 19,719 in October 2014. Suggestions: Small- to mid-sized units will likely lead a recovery in the metropolitan Seoul housing market in 2015. As such, the government should guard against bubbles forming in non-capital areas that attempt to follow the home buying trends in the Seoul metropolitan area. 8. Manufacturing Reset

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Korea’s manufacturers are under pressure from the revival of peers in advanced countries and the rapid ascent of those in China. The manufacturing sector needs to be remodeled from the ground up. Korea’s export growth has slowed down in the past two years, and the meager increase in its share in the global export market has also stagnated at 3.1 percent since 2010. China, on the other hand, saw its share in the global export market jump from 3.9 percent in 2001, when it joined the World Trade Organization, to 12.1 percent in 2013, and that of the United States also bottomed out at 8.1 percent in 2008 and rebounded to 8.6 percent in 2013. Most of Korea’s major industries, except for semiconductors and automobiles, have experienced stagnant growth or weakened market influence in the past three years. The global markets for communication equipment are expanding but Korea’s market share is falling. The nation’s shipbuilding industry is also losing global market share. As for steel, machinery, assembled cars and petroleum goods, the global markets are either shrinking or stagnating, and Korea’s share is barely up or stagnant. In 2014, large companies representing major industries that have led the nation’s manufacturing sector are experiencing deteriorating performances, calling for the government to draft measures to reset the manufacturing sector whose position in global markets has been ever shrinking. Currently, the United States, Japan and Germany are bolstering their manufacturing sector, while China is trying to foster domestic industries.

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Korea needs to explore projects that will serve as growth engines in the future, speed up the creation of an environment conducive to industrial renovation, and establish a policy for industrial reset. It is necessary to aggressively develop strategies to create new products and services in promising futuristic sectors, such as energy, climate, health, materials, and ICT. With respect to exploring new industries, the nation will have to upgrade its manufacturing sector by making the most of ICT, robot, nano and material technologies as well as develop convergence-oriented businesses in safety, culture, arts and healthcare areas. In order to facilitate convergence among industries, it is necessary to establish a comprehensive management system with the participation of all related government agencies, and push for diverse projects depending on the levels of technological development, achievements and influence. Korea also needs to renovate both product technology and processing technology, promote the “industry solutions policy” that blends products with services, and push for policies that will help create markets and enhance accessibility. It needs to graft scientific technology, such as ICT and nano technology, to existing industries, thus developing major next-generation export items and innovating new processing technology. The nation should shed its industrial policy focusing on manufacturing, and move toward a “solution industry-oriented policy” by combining manufacturing, processing and services, to better cope with the reorganization of global market hegemony. It ought to reform laws and institutions to keep pace with looming changes in the industrial environment, particularly focusing on bold reforms of 106

the regulations that hinder market creation and restrict market accessibility, so as to achieve overall industrial renovation and speed up new industry creation. Emphasis should also be given to expanding tax incentives for R&D, constructing innovation-oriented corporate ecosystems involving both large and small-tomidsize enterprises, and fostering convergence-oriented creative talents and outstanding R&D manpower. The government will have to establish a policy for comprehensive resetting of industries from the viewpoint of innovation-inducing “4Ts” (technology, trade, tax and talent). It should review the current industrial policy with an aim at formulating a long-term industrial development policy to successfully cope with future industrial trends and advanced countries’ policies to foster their manufacturing sector. In this process, the government ought to carefully examine the current situations and future outlooks of individual industries before determining the strategic direction of industrial reset, and draw up execution policies from the viewpoint of “tax, trade, technology and talent,” which will serve to stimulate innovation. Suggestions: While closely monitoring the changes in new businesses and technologies, the trends in neighboring competitors like China and Japan as well as those in other industrial countries, the nation needs to revamp its industrial promotion policy and business strategy from the ground up. 9. Economic Structural Reform There is no parliamentary, local or presidential election in 2015, the best time for the nation to immerse itself in retooling its economic structure and improving economic fundamentals without having the effort derailed by politicians and various interest groups. In order to fundamentally cure Korea of economic crises stemming from slow growth and deflation, the nation needs to renovate its economic physique by reforming its labor market, service sector, domestic investment and financial industry.

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Concerns about deflation are deepening, as the growth potential sinks to the mid-3 percent range and the trends of slow growth and low inflation show signs of continuing amid sluggish investment (gross capital formation) and drop in total factor productivity. “Deflation gap” ― caused by real GDP hovering below potential GDP ― has persisted for nine consecutive quarters, and “minus inflation gap” ― caused by real inflation hovering below potential inflation ― has been in place for 13 consecutive quarters. Structural reforms are urgently needed from the aspects of deregulation (stimulating domestic investment), labor market (resolving dual structure), service sector (toward higher value added), and finance industry (fostering venture capital).

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Â The nation needs to focus on regulatory reform to help not only Korean firms operating abroad increase their domestic investment (U-turn) but encourage foreign businesses to invest in Korea (K-turn). Since 2008, Korea has had a net outflow of foreign direct investment with the amount soaring from $3.2 billion to $45.7 billion in 2012. Drastic deregulation is needed. For example, free economic zones should be open to domestic companies. Â The government needs to reform related laws and regulations to resolve the dual structure of the labor market, which is divided between regular and non-regular workers and between large conglomerates and SMEs. Regular, unionized workers at large conglomerates receive a monthly salary of 3.92 million won, but nonregular, non-unionized workers at SMEs receive 1.35 million won on the average. Up to 99.5 percent of regular, unionized works at large companies receive pensions, but only 34.2 percent of non-regular, non-unionized workers at SMEs do so. The layoff rate of temporary, contract workers is very high, while that of regular workers is far lower. Â It is urgent for Korea to reform regulations on its service industries by continuously restructuring low value-added, self-employed businesses, as well as lowering and eventually removing entry barriers to high value-added service

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businesses, such as medical care, tourism, legal and educational services, to strengthen their global competitiveness. Unlike the manufacturing sector, labor productivity of Korea’s service sector has seen its gap widen with those of the United States, Japan and Germany since the turn of the 2000s. In other words, the ratio of Korean service industries’ productivity against that of the three countries fell from 31 percent in 2000 to 24 percent in 2009. In order to help stimulate business startups equipped with high technology and new ideas, the nation needs to foster venture capitalists and angel investors, establishing a virtuous cycle in the ecosystem of startups and energizing a creative economy. The share of venture enterprises listed on Kosdaq dropped to 1.0 percent in 2013 from 1.7 percent in 2008. Suggestions: To stimulate investment by business corporations ― Korean and foreign ― and regain economic vitality, the government should expand discussions and enhance communication to overcome objections of interest groups and forge national consensus on structural economic reforms. 10. Demographic Challenges Korea has a very low birthrate and rapidly aging population. It is now at the threshold of meeting the U.N. definition of an “aged society” with senior citizens accounting for 13.1 percent of the total population. The nation will enter into an “aged society” in 2017 (14.0 percent), and into a “super-aged society” in 2026 (20.8 percent). Demographic consequences are becoming a reality now. Korea’s economically active population is dwindling and the aging of its workforce is accelerating. Productivity, employment, fiscal balance, and real estate market will be increasingly affected. Population aging naturally decreases the economically active population, which, in turn, reduces labor input, consumption and investment, eventually slowing down economic growth. A shrinking economically active population also means fewer workers contributing to public and private pension plans. This will put increasing pressure on the National Pension System, various public services and medical care, straining the government’s budget. A 1-percent increase in the aged population is estimated

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to aggravate fiscal balance (against GDP) by 0.46 percentage point. At corporations, wage increases for elderly employees in the nation’s senioritybased pay structure will turn into greater financial burdens, denting R&D spending and new investment.

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In the labor market, the inter-generational conflict over jobs will intensify. To build up savings, which are low in many households, the elderly want to work as long as possible or try to reenter the labor market. Because of the limited job availability and hiring, as well as mismatch between college education and demand of business, it is becoming difficult for younger generations to land decent jobs. Conscious of the ramifications of population aging, workers in all age groups will tend to reduce consumption in order to save more for the future. Of course, that will be a retardant to sales tax revenue and corporate revenue that can be used for hiring and investment. In the housing market, demand for small homes will increase because of a bulge in elderly singles and couples who want to reduce spending and don’t need large spaces because their children have grown up and left. Suggestions: In preparation for the challenges posed by low fertility and population aging, the nation needs to improve productivity, expand employment and ease fiscal burden. To enhance labor utilization, the nation will have to raise its birthrate, facilitate the labor force participation by elderly and female workers, and improve productivity through refinement of human capital. Korea also must secure the capacity to expand the employment of younger generations, continue to broaden the revenue base, and reduce government spending. 11. Laying Foundation for Unification The year 2015 marks the 70th anniversary of Korea’s liberation from Japanese colonial rule as well as its territorial division into North and South Korea. It also marks the third year of the Kim Jong-un regime in the North, which finds it increasingly urgent to demonstrate some economic achievements. North Korea, emphasizing the need to improve the standard of living of its population and build an economically strong country by attracting foreign capital, is expected to introduce broader reform and openness, both internally and externally, and try to improve inter-Korean relations. Therefore, there are rising expectations that Seoul will accelerate efforts to build trust with Pyongyang to lay the foundation for peaceful unification.

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The trust-building projects will likely include economic cooperation, social and cultural exchanges and humanitarian aid. It also is necessary to reactivate the stalled projects. For example, the first-stage development of the joint Kaesong (Gaeseong) Industrial Complex could be completed and the second-stage programs started. Internationalizing the inter-Korean industrial park by attracting foreign businesses, as well as reopening the Mt. Kumgang (Geumgang) resort and Kaesong in the North to South Korean visitors, also could be on the agenda. For further development of the joint industrial park in Kaesong, the two Koreas need to resolve the “3Cs,” that is, cross-border travel, communications and customs clearance. They also need to legalize and institutionalize the park’s operation to meet international standards by improving labor, taxation and insurance systems and working out dispute settlement procedures. In order to resume Mt. Kumgang tours, the two Koreas ought to find out ways not only to prevent the recurrence of similar accidents and guarantee the safety of tourists but also to protect investment properties and set up a system to resolve any disputes.

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South Korea is pushing to lay the foundations for multilateral projects. The South is encouraging the North to participate in the regional economic cooperation projects that are under way along its borders with Russia and China. Among major projects are the GTI (Greater Tumen Initiative), rail, road and port construction between North Korea and China, and between North Korea and Russia, the connection of Trans-Siberian, Trans-China and Trans-Korea railways, and gas pipeline construction linking Russia and the two Koreas. South Korea’s economic aid to the North will also expand from simple support to agricultural, health and forestation projects. The so-called “green détente” will thus promote exchanges and cooperation. Currently, the South is trying to transfer agricultural technology, jointly develop superior species, and support construction of agricultural infrastructure, along with the large-scale CDM projects such as the forestation of barren land, repair of hydro plants and construction of wind power plants. Seoul is also pushing for regular reunions of separated family members and return of South Koreans abducted by the North and South Korean prisoners of war. About 3,800 persons from separated families die annually in the South alone, some 2,200 of them without having an opportunity to be reunited with their family members in the North. Suggestions: In order to pave the foundation for peaceful unification, the two 114

Koreas should lay the basis for the stable promotion of economic cooperation and create conditions that enable the provision of systematic humanitarian assistance. Inter-Korean economic cooperation might be expected to imbue the South Korean economy with fresh vitality by stimulating the development of regional economies and offering breakthroughs for marginalized SMEs. It is important for both sides to realize that unification would deliver substantial growth momentum to both Koreas. To this end, what’s needed is an institutional basis for stable implementation of joint projects. The two Koreas need to start discussion on creating a permanent agency for exchange and cooperation to handle two-way flow of visits, matters related to political, economic, social and cultural exchanges, and maintain official and unofficial channels of dialogue. The South should also try to materialize the Eurasia Initiative by expanding the “Korean peninsula trust-building process” through large-scale economic cooperation projects aimed at consistently improving and advancing relations between the two Koreas. [Weekly Economic Review 14-50, No. 621, December 19, 2014, Hyundai Research Institute]

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- Traditional Smiths in Modern-day Seoul

- Chasing Away Prejudice toward Multiculturalism

- Reclaiming Overseas Cultural Assets Private-Public Discordance Hampers Return of Joseon Queen's Seal

- “It's Unfortunate that Korean Treasures are Just Lying in Storage Rooms at Museums Overseas”

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Traditional Smiths in Modern-day Seoul

Ryu Sang-jun, right, and his younger brother Sang-nam run a traditional smithy in Susaek, northwest of downtown Seoul, catering to customers from around the country.

Lee Gil-woo Senior Reporter The Hankyoreh

The firepower is over 2,000 degrees Celsius. The younger brother lifted a rectangular red-hot spring steel with tongs, burrowing in the furnace raging with flame. It is cast iron just before being melted. The older brother, who is sitting in front, picks up the cast iron with his tongs and starts to forge it with a spring hammer. In the past it was manually pounded with a hammer. Now, the powerful spring hammer that automatically moves up and down is used to quickly turn the cast iron into a long knife. The older brother has been “kneading iron like dough” this way for the past 47 years. A few days ago, a regular customer whose hobby is camping asked the brothers to make a knife for the outdoors. They decided to make a few more. The knives each cost 80,000 won. The brothers’ business located near the entrance of Seoul’s Susaek subway station along a crowded thoroughfare is named “Smith Brothers.” They don’t talk much as they work in perfect coordination. In their workshop a brief moment of carelessness can result in a serious injury. A taxi stops in front the shop and the driver shouts through the open window, “Is

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my hammer done?” It is a common exchange. Since the smithy is on the roadside, regular customers make orders without even getting out of their cars. A while later, a truck stops there again. There is another shout through the window of the truck, “Give me my hoe I ordered a few days ago.” Nationwide Customer Base Ryu Sang-jun, 60, the older brother, opened the smithy 17 years ago. Their customers come from across the country. One regular customer, who runs a big sushi restaurant in Jeju Island, comes once a year and purchases a custom-made fillet knife for 150,000 won. Among other regulars are office workers tending weekend farms, housewives keen on decorating their apartments in unique styles, and period drama producers from broadcasting companies, who mostly order weapons for war scenes. Several years ago, they also made “traditional Seoul-style kitchen knives” for the popular TV drama “Gourmet.” The Cultural Heritage Administration is also a client; it orders door handles and hinges needed for repairing ancient monuments such as old royal palaces and city gates like Gyeongbokgung, Changgyeonggung and Sungnyemun. Ryu Sang-jun started working as a blacksmith shortly after graduating from elementary school. Nationally renowned blacksmith Park Yong-shin lived in the same neighborhood in Moraene, not far from Susaek. Starting with how to blow with the bellows, Ryu learned time-old blacksmithing skills one after another. His teacher was impressed with his meticulous hands and patient attitude. He didn’t hesitate to make a whole new piece when he found even a single slight fault in a finished item. His list of regular customers increased steadily as his devotion impressed buyers. After 10 years of apprenticeship, Ryu opened his own smithy at Amsa-dong, also to northwest of downtown Seoul, in 1976. Then he moved his shop to Moraene before finally settling at Susaek in 1997. His younger brother, Sang-nam, 57, started small business when he was young, selling all kinds of commodities, like rice cakes, vegetables, clothes, etc. He was a successful merchant but lost his entire fortune by underwriting someone’s debt. He began learning blacksmithing at his brother’s shop about 20 years ago, and has paid off his debt and even bought a home by working there.

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The father of the brothers was an expert in shoeing cattle. During his time, shoeing one head of cattle cost one mal (18 liters) of rice, and he used to shoe 20 heads a day, earning more than two bags of rice (about 500,000 won, or $500, in today’s value) a day. When asked, “Can you actually earn money from running a smithy in a city today?” the older brother replied with a smile, “Yes, we earn enough to save about 100 million won a year.” Iron articles made by the brothers are piled up around the furnace, from common farm tools such as sickles, axes, pickaxes and hoes to decorative objects ordered by professional clients. Sang-jun, in his working outfit covered with iron powder and dust, said, “I think I have achieved my life goal somehow.” He started teaching at Korea National University of Cultural Heritage in Buyeo, South Chungcheong Province, in March this year. “I barely finished grade school and am now teaching university students. I really love teaching them. I feel I’ve been rewarded for walking on the same path all my life.” He has found some young people who are interested in blacksmithing, which makes him happy. The brothers dream about establishing a smithy museum someday. They hope to contribute to preserving Korea’s old traditions that are disappearing. Many ironmade daily supplies are already being imported from China. There are few manufacturers using traditional blacksmithing methods due to price competitiveness. “Products from our shop last decades. They are a few times more expensive than Chinese imports, but are incomparable in terms of the comfort of the grip and the solidity of the iron,” Sang-nam says. As the older brother lifts a piece of red-hot cast iron from the furnace with his tongs, the younger brother takes off his top and grabs a hammer. The two brothers strike the iron in turns. Sparks fly up in all directions. The vital energy of the blacksmiths fills the air. Cold melts away in an instant. [December 29, 2014]

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Chasing Away Prejudice toward Multiculturalism

Tanweer Ahmed Abassi, far left, and his fellos volunteer night guards patrol in Itaewon for the first time on November 28, 2014.

Lee Saem-mul Staff Reporter The Dong-a Ilbo

“Wow! What are you doing here?” On the Itaewon Global Food Culture Street in Yongsan District, Seoul, around 8 p.m. on November 28, 2014, Todd Russell, a 41-year-old Canadian, strolling with his Australian friend, posed the question to five foreigners wearing black caps and blue vests and holding blinking glow sticks. It was the first day of patrolling for the volunteer night guards of Itaewon Special Tourist Zone, which is considered to be “the most multicultural place” in Korea. One of the guards, Melanie Kang, 26, from the Philippines, introduced the guards to them and asked if they “need any help.” Russell smiled saying, “I’ve been living in Korea for 14 years. Everything is fine with me.” The Yongsan police station created the crime prevention unit. The group has 12 members of five different nationality backgrounds such as Pakistan, Philippines, Nigeria, Uzbekistan and Iran. They all live in Yongsan and speak Korean. Each volunteer goes on patrol with police twice a month. They also provide counseling and guidance to foreigners and make suggestions on public order policy to the police.

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Tanweer Ahmed Abbasi, 42, from Pakistan, head of the volunteer night guards, has been living in Korea since 1997. He married a Korean woman in 2005 and created the Pakistan Community Korea in 2012, serving as its leader. The purpose of the community is to improve the image of Pakistanis among Koreans. He noticed that many Koreans had prejudices about Korean women marrying Pakistanis while they didn’t have any objection about marrying Americans or Canadians. When there was news about Muslim terror attacks and crimes committed by Pakistanis, Koreans even feared Pakistanis. Abbasi says, “About 90 percent of the Pakistanis in Korea take good care of their families and work hard, making lots of efforts to learn Korean culture. In any group it’s always just a minor fraction that makes troubles, but bad news spreads quickly. My wife had to suffer from lots of mental stress.” The Pakistan Community Korea has some 2,200 members. Abbasi has explained Korea’s law and order to the community, advising his compatriots to “never lie doing business” and “never fight on the street,” because he believes good behavior can help improve their image. A businessman engaged in electronics trade and restaurant operation, Abbasi says, “I have no plan to leave after saving money. I want to continue to live in Korea.” [December 1, 2014]

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Reclaiming Overseas Cultural Assets: Private-Public Discordance Hampers Return of Joseon Queen’s Seal

Lawmaker An Min-seok urges the Los Angeles County Museum of Art to return the seal of Queen Munjeong in a press conference in Seoul on April 16, 2014. At left is the Ven. Hyemoon.

Han Gyeong-hwan Staff Reporter The JoongAng Ilbo

When U.S. President Barack Obama visited Korea last April, he brought nine royal seals from the Joseon Dynasty (1392-1910) that had been illegally taken by American soldiers during the Korean War. Among them were the state seals of the Korean Empire and the royal seal (seal of the royal family symbolizing their sovereign power) of Emperor Gojong. Regrettably, the seal of Queen Munjeong (1501-1565) that was lost around the same time was not included. The golden seal, which had been in the Los Angeles County Museum of Art (LACMA), could not be brought home. It had been seized for investigation by the U.S. Immigration and Customs Enforcement's Homeland Security Investigations (HSI) at the request of the Korean government. Legal proceedings were under way. If repatriation negotiations between private groups in Korea and the museum had gone smoothly, the seal’s “peaceful return” would have materialized. However, due to dissonance between the private groups and the Korean government, it is unclear whether the seal will ever be returned. Coordination between the government and private organizations are crucial in the retrieval of cultural assets that were looted or illegally taken abroad. It is difficult

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for government agencies, such as the Overseas Korean Cultural Heritage Foundation, to stand at the forefront when it comes to such issues due to diplomatic reasons. This is why the participation of private groups and academic institutions is essential, particularly in investigating whether Korean cultural properties overseas were taken illicitly, and during the early stages of repatriation negotiations. Government involvement is required in the final stages since the cultural assets are national property. “Only when there is effective collaboration between private and public institutions can we hope to achieve substantive results in the retrieval of overseas cultural assets,” said Oh Yeong-chan, a social education professor at Ewha Womans University (teaching ancient Korean history) and a former curator at the National Museum of Korea. The controversy surrounding Queen Munjeong’s golden seal is a leading example of the lack of coordination between private groups and the government in terms of strategy and action plan. The seal is presumed to have been taken illegally to the United States together with 46 other Joseon royal seals during the Korean War. Civic groups, such as the Committee for the Return of Cultural Property (headed by Venerable Hyemoon), which confirmed records of such in the U.S. national archives “Ardelia Hall records,” have been promoting a campaign since 2010 to facilitate its return. They requested LACMA to return the seal, stating, “If investigations prove that it was stolen, it will be seized by American authorities,” and said, “We wish to have it returned through negotiations rather than an investigation or impoundment.” LACMA agreed that it would not be desirable if the seal that was on exhibit at the museum were to be impounded, and expressed their intention to voluntarily return it in September 2013. However, on May 23, 2013, while negotiations were still gong on, the Cultural Heritage Administration in Korea asked U.S. authorities to launch an investigation. The HIS seized the seal on September 27. “We requested investigating authorities in the United States for prompt action in impounding the seal,” said the Cultural Heritage Administration. “Once it is seized, we hope to have it returned after January next year,” it added.

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LACMA suffered a blow to its reputation for having possessed a stolen property when it had already decided to return the seal to the Korean government. The museum expressed displeasure, saying, “As the seal has been seized by the HSI, we are not in a position to say anything about its return.” “There has rarely been a case where a cultural property was retrieved through negotiations,” said lawmaker An Min-seok of the New Politics Alliance for Democracy, who took part in the negotiations. “The return of Queen Munjeong’s seal could have set a precedent, but with the intervention of the authorities, even if it is returned now, it will have been through investigation and impoundment,” he added regretfully. Efforts to retrieve the Lamaistic pagoda-style sarira reliquary from the Goryeo Dynasty, currently held by the Museum of Fine Arts, Boston (MFA), also met with a similar fate. The sarira reliquary was stolen from a tomb in 1939 during the Japanese colonial era and taken to Japan, and thereafter sold to the MFA. After negotiations, civic groups in Korea and the museum agreed on the return of the contents of the reliquary, namely, the sarira of Sakyamuni Buddha, Indian zen master Dhyanabhadra (Zhikong, known as Jigong in Korea, circa 1289-1364) and Korean high priest Naong (1320-1376). However, such efforts were thwarted as the Cultural Heritage Administration opposed the return of the sarira only. Since the Overseas Korean Cultural Heritage Foundation was established in July 2012, two ancient paintings have been successfully recovered — “Sakyamuni Triad” (donation) and “Guo Ziyi’s Banquet” (purchase). “True repatriation of cultural assets does not involve a donation or purchase, it is foreign institutions or museums illicitly holding our cultural properties returning them to us,” said Hyemoon. [December 10, 2014]

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“It’s Unfortunate that Korean Treasures are Just Lying in Storage Rooms at Museums Overseas”

Robert Turley, president of the New York-based Korean Art Society, shows his collection of Korean art objects kept in a storeroom in Manhattan.

Han Gyeong-hwan Staff Reporter The JoongAng Ilbo

My eyes opened wide the moment I stepped inside a room in a storage building in Manhattan, New York. It was filled with ancient Korean artifacts, including old books, paintings, calligraphy and ceramics. It was like a mini Korean museum of art. The owner of that room is Robert Turley, 53, president of the Korean Art Society (KAS), a non-profit educational organization dedicated to promoting Korean art and culture that he founded in New York in 2008. In six years, the number of KAS members has increased to 5,000. “People from diverse backgrounds, nationalities and occupations have come together for their pure love of Korean art and culture,” explained Turley. Several times each year he arranges tours of museums in the United States that house collections of Korean artworks and organizes exhibitions on Korean art. In 2012, they visited the storage room of the Smithsonian National Museum of Natural History in Washington, D.C. that houses the largest collection of Korean artifacts in America and had the opportunity of viewing rare cultural objects from Korea’s past. Here they discovered a sword from the Joseon Dynasty in the shape

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of a Japanese dagger. “It is most unfortunate that these treasures are just lying buried in a small storage room,” said Turley. “I intend to approach the museum about holding an exhibition of ancient Korean weaponry with the artifacts in the storage room,” he added. KAS recently organized an exhibition of the Lea Sneider collection of Korean art in New York. “Cultural assets that were looted must be reclaimed,” Turley stressed, adding, “I would like to do all I can to help the Korean government or organizations in their efforts to recover cultural assets that were taken abroad.” There are other organizations overseas than KAS that are likewise devoted to the promotion of Korean art and culture, and the repatriation of displaced cultural assets. In Japan, a public symposium titled “Thinking about the Repatriation of Korean Cultural Assets” was held on June 12, 2010, marking the 100th anniversary of the Japanese annexation of Korea. Participants working on the repatriation issue held a liaison meeting, and have continued to remain active in research and activities related to the retrieval of cultural assets. Just as important as efforts to reclaim cultural assets is promoting the excellence of Korean culture through Korean artworks located overseas. “The size of Korean galleries is generally small, but an even bigger problem is the lack of content to put on display,” said Lee So-young, a Korean art curator at the Metropolitan Museum of Art in New York. Lee also pointed out, “Because the number of Korean artifacts circulating in the market is so small, it is difficult to fill galleries,” and added, “Unless it concerns objects that absolutely must not leave the country, we should ease regulations so that artworks can be more easily distributed overseas.” Currently around 500 pieces of Korean artifacts are on display at the Metropolitan Museum of Art, including a statue of Pensive Bodhisattva. As to how to effectively tackle the issue of retrieving cultural assets that were illicitly taken abroad, the prevailing opinion calls for long-term, methodical research and collaborative networks. “A win-win strategy, such as reciprocal lease of cultural artifacts, could be more efficient,” noted Lee Bo-a, a professor at Sogang University (Department of Art and Technology). “What’s most important is tracking down the whereabouts of these artifacts and identifying the channel through which they ended up in the current location,” said Jeong Gyu-hong, a

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teacher at Ganghyeon Middle School in Seoul, who has been studying looted cultural assets for a long time. “We need to build a system that can facilitate the sharing of private individual research,” he added. But some point out that boisterous campaigns pushing for the return of cultural assets could backfire. “Taking an overly aggressive stance can put the country holding our cultural property on the defensive,” said Oh Yeong-chan, a social education professor at Ewha Womans University. “There have been cases where the museum in possession of our cultural property was reluctant to show it to us, making research activities difficult,” he added. [December 11, 2014]

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- The Sea Completes Silk Road

- The Secret of Joseon's Success in Foreign Language Education

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The Sea Completes Silk Road

"The Cyclopedia of Sea Silk Road" and "Silk Road" written and complied by jeong Su-il and published by Changbi Publishers

Oh Mi-hwan Senior Reporter The Hankook Ilbo

“The Cyclopedia of Sea Silk Road” and “Silk Road” By Jeong Su-il, Changbi Publishers, 460 pages, 30,000 won; 496 pages, 100,000 won Jeong Su-il, director of the Korea Institute of Civilizational Exchanges (KICE) and a pioneer in the study of the Silk Road, has recently published two books, “The Cyclopedia of Sea Silk Road” and “Silk Road,” in partnership with Changbi Publishers. To say that he has gone to great lengths to write both books would be an understatement. Jeong was 70 when he first embarked on a journey along the Silk Road in 2005 to study the history of cultural exchange. Nine years later, after making 44 trips that amounted to 457 travel days, he returned from his final visit on June 21, 2014. “The Cyclopedia of Sea Silk Road” has 621 entries related to exchanges between civilizations that occurred across oceans. They had largely been overlooked in the discussion of Silk Road. About one-third of these entries cover basic knowledge about the ocean, and 119 entries are brief descriptions of the key ports along the global Maritime Silk Road. The text about the ocean was written by Dr. Choi Woong-seo and two other experts from the Korea Institute of Ocean Science and Technology (KIOST). Kang Yoon-bong, a member of the board of directors at the

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KICE, took charge of documenting the key stops along the Maritime Silk Road, which includes five Korean locales: Ulsan, Gimhae, Cheonghaejin, Incheon and the estuary of the Yeongsan River. Jeong served as both the editor and the author of entries on exchanges between civilizations. Jeong believes that the Silk Road has far greater significance than a mere route for trading the highly prized fabric. It was the corridor for broad-based exchanges between civilizations that were unfamiliar to each other. In a more comprehensive perspective, he suggests, the Silk Road should include routes connecting the oases and traversing the prairies and the seas. Of these, the sea routes have been overlooked relative to others. “The Cyclopedia of Sea Silk Road proposes to fill this gap by defining and discussing the Silk Road of the sea,” Jeong notes. “The study of exchanges between different civilizations cannot proceed without giving due attention to the Silk Road of the sea.” Jeong goes on, “But neither China nor Japan has acknowledged the ocean passages as part of the Silk Road. China has always emphasized the pathways on land along which silk was transported. The only documentary film in the world dedicated to the subject was produced by NHK in the 1980s, and it made no mention of the sea. However, we are seeing signs of change. Last October, Chinese President Xi Jinping proposed to develop a ‘21st Century Maritime Silk Road’ that would begin from southeast China and run through Southeast Asia, Southwest Asia, Africa, and all the way to Europe. He is working to create Silk Road Fund with the projected size of $40 billion and a Maritime Silk Road bank. NHK is now filming a documentary series consisting of 10 episodes about the Maritime Silk Road.” The Silk Road until now has been understood primarily in the context of the Old World, but Jeong sees Silk Road as a truly “circum-global” route of exchange that extended beyond the Old World to the New World and Oceania. Given the nature of the globe, it is a moot point to try to determine where it begins. One may start from Gyeongju, Korea, or in southern Africa and return by following the maritime Silk Road. Like “The Cyclopedia of Silk Road” published a year earlier, “The Cyclopedia of Sea Silk Road” is full of information about events and explanations of relevant concepts. Some entries cover two to three pages, and there are 162 photographs

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of the sites that are described. “Silk Road,” published alongside “The Cyclopedia,” is a collection of 900 photos that were carefully selected from a pool of 90,000. Each photo is accompanied by a description in the context of exchanges between different cultures. It is quite an impressive trove of information and insight. They provide a good sense of how different cultures interacted with each other via the sea routes in the past and compare the exchanges to how they are done today. What is most striking is Jeong’s passion and commitment to the project. Interestingly, the descriptions about the different cultures, arts, lifestyles and customs of people around the globe serve to highlight the common themes that run across all human cultures. For example, in tracking the movement of ethnic groups he talks about the trajectory of Native Americans, who share some DNA, customs and cultural similarities with Koreans. He draws from these findings a confirmation of the universality of human civilizations. Jeong has laid the foundation for a new academic discipline through his works, including “A Study of Silk Road” (2001), “A History of Trans-Civilizational Exchanges” (2002) and “The Cyclopedia of Silk Road” (2013), for which he won the 54th Korean Publishing Culture Award. He has written at least eight books about Silk Road, and considering his lifetime of research and nine years of exploration, he can quite confidently claim that there is universality in human civilizations. “Civilizations are different but they share commonalities on which we can build solutions to conflicts. Different civilizations will rise and fall, but we cannot rate them to say one is superior to another. Samuel Huntington’s ‘Clash of Civilizations’ exhibits the flaws of Western-centrism. We have to see mankind as being one and connected through trans-civilizational exchanges.” Jeong was born in Yanbian, China. He first became interested in human civilizations as an undergrad student at Peking University. He continued his studies at Cairo University in Egypt, where he realized that Silk Road may have served to transport more than just the fabric. Later he became a history professor at Dankook University in Seoul. Despite a five-year imprisonment on charges of espionage, he continued his study of Silk Road as part of his endeavor to

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understand the exchanges that took place between civilizations. In fact, it was in prison in 1998 that he began to write on this subject in earnest. At 80, Jeong is still full of energy and is preparing to publish one more encyclopedia, tentatively titled “The Cyclopedia of Civilizational Exchanges.” He has already decided on a list of 5,148 entries. The upcoming work will encompass North Africa and Latin America to expand on his earlier literature focused primarily on Europe and Asia. [December 25, 2014]

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The Secret of Joseon’s Success in Foreign Language Education

"Foreign Language Education in Joseon Dynasty" written by Jung Gwang and published by Gimmyoung Publishers

Han Seung-dong Senior Reporter The Hankyoreh

“Foreign Language Education in Joseon Dynasty” By Jung Gwang, Gimmyoung Publishers, 540 pages, 18,800 won In his latest book, Dr. Jung Gwang, professor emeritus of Korea University, rightly points out that there has been a significant lack of research on the history of education in Korea. The critical assessment that follows delves into the causes of this deficiency and leaves one feeling a bit embarrassed after reading. He wrote: “The immediately obvious reason may be the general tendency in the Korean academia to attach greater importance to the history of education in the developed world than in our own educational history. The more fundamental cause could be that historical literature on education was written in Chinese characters or in the archaic Korean writing system called imun or idu, which borrows the Chinese script, and is thus rather inaccessible. Another important reason is that the scholars themselves often limit the scope of their research to periods after Western-style school education was introduced.” If it is indeed true that one of the major stumbling blocks to the study of Korean educational history by experts is their illiteracy of old texts written by their own 133

ancestors, then all the rage over foreign language education we see today is quite ironic and unsettling. In this context, “Foreign Language Education in Joseon Dynasty” written by Dr. Jung Gwang, a scholar who has dedicated 30 years to this topic, offers much that piques our curiosity. Dr. Jung is known for working with Dr. Nam Gwon-hee, a scholar of bibliography who discovered the original copy of the Chinese textbook “Nogeoldae” (Laoqida in Chinese) in 1998. Together, they presented the significance of this finding to the international academia. The discovery of this book, which is believed to have been published in 1346 during the late Goryeo Dynasty, excited all the researchers of the Chinese language. It is regarded as one of few remaining documents lending insight into Han’er language of the Yuan Dynasty. Dr. Jung’s latest book provides an in-depth account of foreign language learning after the Three Kingdoms period in Korea. The author discusses why Chinese, Mongolian, Japanese and Manchu had to be taught in Joseon Dynasty (13921910), what texts were used for teaching and how the outcomes were evaluated based on concrete examples. He believes that foreign language education began in earnest in Korea in the late Goryeo period, when the Han Chinese writing system and the spoken Chinese language became disconnected under the Yuan Dynasty. “In early 13th century the Mongols gained power in the region, including the control of Beijing, which produced a new form of Chinese language with heavy Mongol influence. This was Han’er language, which had been described as Chinese based on metaphrased Mongolian. It was such a different language that people who spoke Han’er could not communicate with those who spoke yayan or tongyu.” Yayan and tongyu were used during the Warring States period and continued to be used when the Qin Dynasty unified China. Yayan was primarily a literary language, and most early Confucian texts were recorded in this language. Han’er, in contrast, was the spoken language of Beijing and the common tongue of the Yuan Empire. Rulers of Yuan and Goryeo needed a solution as these two languages could not communicate with each other. In 1276, or the second year in the reign of King Chungnyeol of Goryeo, the Tongmungwan was set up as a government initiative to systematically train translators. Later Tongmungwan was renamed Sayeogwon. The name remained unchanged well into the Joseon

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Dynasty, while the role gradually evolved to train more people to master the writing system and spoken language of China, such as hanwen (the written Chinese), hanliwen (the practical Chinese writing system used mainly by government officials) and hanyu (the spoken Chinese). Dr. Jung sees the invention of the Korean writing system called Hunmin Jeongeum (meaning “The Correct Sounds to Instruct the People”) as an effort to enhance communication between Korean, an agglutinative language by nature, and Chinese, an isolating language. The Sayeogwon stayed in existence until 1894, the year of the Gabo Reform. Few nations have maintained an institution dedicated to the teaching of foreign languages for such an extensive period of time without interruption. In fact, the educational framework of Sayeogwon was quite sophisticated even when assessed based on modern-day theories of language education. One of the key characteristics the author noted about the programs at Sayeogwon was how early the education began. For example, Hyeon Gye-geun (born in 1726) who once rose to a major second rank (jeong i-pum) position in government was enrolled in Sayeogwon at the tender age of four as a student of the Japanese language. Another distinct feature was learning by intensive repetition. Official translators at this institute were required to continue memorizing textbook materials and to take tests no matter how high their rank. Thirdly, verbal communication skills formed a critical part of the program. The main Chinese textbook “Nogeoldae” consisted of 106 scenes written out in the dialogue format depicting the journey of Korean merchants en route to China to sell ginseng, ramie cloth and horses. The authors were Korean translators who had been to Beijing. Some examples of episodes include: “1. Where are you from?”; “8. Where will you sleep tonight?”; “9. How much is the horse feed?”; “84. What illness is it?”; and “106. See you again.” All the episodes consisted of everyday dialogue. A student who had mastered “Nogeoldae” could go on to “Baktongsa” (Piaotongshi in Chinese), an intermediate textbook for Chinese. Both textbooks were published at around the same time. The fourth characteristic was the adaptation of a curriculum to reflect the

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evolution of the target language. Diplomatic missions to China often included one officer responsible for asking questions about words or phrases that were difficult to interpret so that the information could be reflected in future textbook revisions. Â Fifth, foreign language education was conducted across the nation, and the treatment of and benefits to the translators, who belonged to the middle people (jungin) between the nobility and the commoners, were quite attractive. The government also delegated different roles to the official translators, including that of diplomats, auditors and tax collectors to name a few. The translators had cross-border trade privileges and could be promoted all the way to the third rank in the 18-level government hierarchy. Of the 35 official members of a delegation to China about 20 were translators, and the opportunity to travel abroad and experience foreign cultures was viewed as a special privilege. Â Experts deliberate over the strategies of middle powers like the Netherlands that actively promoted the learning of languages of neighboring nations. We need not look so far away because our ancestors seemed to have developed similar strategies amid similar geopolitical conditions. Â [December 29, 2014]

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- Koreans' Germany Fantasy a Little Inflated

- Takashi Uemura “My Article on Comfort Women was Not Fabricated.”

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Koreans’ Germany Fantasy a Little Inflated

German Ambassador Rolf Mafael speaks at a press briefing about a symposium marking the 25th anniversary of German unification, at Seoul Square on September 16, 2014.

Jeong Jun-ho Staff Reporter The Hankook Ilbo

There was a time when products made in the USA and made in Japan were considered the best you could get. Everything from everyday appliances to policies and politics were imported from the two countries. When it came to economic systems, it was not so long ago that we reformed and adopted U.S. and Japanese systems. Now the focus of such admiration is shifting to Germany, an attitude that is shared by other countries. In the 2014 Nation Brands Index, published last November by the global market research company Anholf-GfK Roper, Germany was ranked No. 1, replacing the United States, which had occupied the top spot since 2009. And while the German illusion is not confined to Korea, it is unusually strong here. From kitchenware and medicine to cars, policies and politics, we are trying to possess or import things German and use them as models. In the most recent example, Deputy Prime Minister and Finance Minister Choi Kyung-hwan said a few days ago that in its effort to reform the labor market, Korea should use Germany’s Hartz reforms as one of the models. In a BBC poll not long ago, 84 percent of Koreans expressed a positive view of

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Germany. In Europe, however, Germany is also criticized for implementing beggar-thy-neighbor policies. At this point, one can’t help wondering what Germans think of Koreans’ attitude. So we asked Rolf Mafael, who has been the German ambassador to Korea since 2012. “It was when I came to Korea that I realized Germany is a good country,” he said. Though he did not really answer the question, if we take into account that he is a diplomat, it can be surmised that he believes Korea’s fantasies about Germany are a little inflated. Q. When Choi Kyung-hwan, deputy prime minister and finance minister, presented Germany’s Hartz reforms as a model for reform of Korea’s labor market, he specifically mentioned easing measures that tend to overprotect regular workers. Does Korea have the correct understanding of the Hartz reforms? A. (Ha, ha) The Hartz reforms, which began in 2003, are very comprehensive. They do cover labor rights, but they also include social security. The Hartz reforms are successful because they have significantly lowered the unemployment rate. In the space of 10 years they have raised the employment rate so high that it can be called an employment boom. Thanks to the reforms, there is much greater flexibility in terms of fixed-term and part-time jobs, and at the same time legal systems have been put into place to ensure that such non-regular workers are treated the same as regular workers. In regard to pay, working hours and days off, there is no discrimination between regular and non-regular workers. It’s important to note that these two things happened at the same time. In Germany, legal institutions and wage agreements between the parties concerned are important. All parties abide by the agreements made by industrial unions and management councils. In such social partnerships, labor conditions and wage agreements are very important. Q. Do you think such reforms are applicable to Korea? A. German companies that have entered Korea say investment is very difficult here because of the inflexible labor market. It would be good to use the policies designed to create a more flexible labor market that Germany began in 2003. Although Germany has achieved almost complete employment through these

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reforms, one problem is the rise of low-income labor. There are a lot of jobs that fall under the level of 9.5 euros per hour, or about 13,000 won. Moreover, the current government is moving to set the minimum wage at an equivalent to 12,000 won per hour. The important thing to remember is that the 2003 Hartz reforms were a good decision, and that they’ve been credited with bringing about full employment. But 10 years down the road, weaknesses have surfaced, so it’s necessary to fix them and be amenable to change. Rather than saying “this policy is good” or “that policy is good” or “that’s the direction we should take,” we need the flexibility to adjust social security and other such matters according to the economic situation. Q. The amount that you mentioned above, 12,000 won — what does that signify? A. The current German government is trying to set the minimum wage at 8.5 euros, but actually 9.5 euros is generally taken as the minimum wage level. Q. There has been backlash to the Korean deputy prime minister’s statement. There is concern that what it means is easier layoff of regular workers. Are you saying various support measures are necessary when adopting such a model as Germany’s reforms? A. It is not for me to say what policies must be taken while bringing flexibility to the labor market. I believe the important point is to create employment and strengthen the economy. It is for the Korean people to decide on the policies that will help them achieve this goal. Q. A recent BBC poll on national image showed that 84 percent of Koreans surveyed had a positive image of Germany. Why do you think Koreans like Germany? A. First, relations between the two countries have traditionally been good. Germany became a divided nation in 1945 and was reunited in 1990. This year is the 25th anniversary of the fall of the Berlin Wall, and I believe one of the reasons why Koreans like Germany is this history of successful reunification. The more elderly Koreans will clearly remember Germany’s economic support for Korea’s reconstruction in the 1960s. Germany provided Korea with loans and

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Korea sent miners and nurses, and the people who remember this know that Germany contributed to Korea’s economic development. It is these things that have created a good image of Germany in the Korean people’s minds. Also, in solving various social problems Germany has presented solutions that Koreans seem to find ideal. Q. Koreans see Germany as a nation of thrift, industriousness and the meister mentality. A. The people I meet in the street have this stereotypical image of Germany: cars, beer, Beethoven, and the environment. And they see Germany’s main virtues as industriousness, efficiency and strong organization. But these three virtues apply equally to Koreans. So it makes me think Koreans like Germans because they are alike in aspects such as these. It’s an interesting perspective, but I do think the two are alike. Q. Specifically, what similarities do you see between the two countries? A. Korea and Germany are similar structurally in that they are both strong in manufacturing and export-oriented, and face the challenges of a low birthrate and the aging of society. I think this is why Koreans are especially interested in Germany compared to other countries. Q. Korea wants to learn from Germany’s small- and mid-sized enterprise (SME) support policies. A. Germany’s SMEs have some distinctly German characteristics. There are globally successful SMEs with employee numbers of less than 100, 200 or 500. The prime reason for success is the distinctive German entrepreneurial spirit, and then the tax benefits and other measures that encourage such entrepreneurial spirit. Most SMEs are in manufacturing, largely due to Germany’s advanced technology and excellent engineers. Under our dual education system, students go to school and at the same time learn firsthand the skills required by industry. In this lies the strength of Germany’s small businesses. What’s important is to secure competitiveness at home, in the local area, before expanding globally. Q. Korea tried to introduce “meister high schools” and learn from the dual

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system. What are your thoughts on that? A. Meister high schools are focused on vocational training. The students practice the skills and gain the knowledge needed in the field. This takes Germany’s dual education system a step further. Under the dual system, students undertake an apprenticeship at a certain company. They receive a set wage and in addition onsite vocational training while attending school. For example, they might go to work three days of the week and attend school for the remaining two days. On the part of the company, they are able to later employ students who have already received on-the-job training, and on the part of the students they learn from the beginning the skills that companies need. I believe Korea’s meister schools have no such system. Q. Korea’s will to learn from Germany can be seen in many areas from policies to education. Is this something confined to Korea or is it happening in other countries as well? A. Koreans say, “Germany is our model” or “Germany is an exemplary case,” and indeed it seems Korea is a little unique in taking Germany as a model for political and economic issues at large. But with the country’s success in dealing with the European financial crisis, there are countries in Europe and all over the world that take Germany as a model in certain aspects. There are several countries seeking to learn from Germany’s dual system when it comes to fostering small business and vocational training. Q. Germany is considered an advanced country not only for its economy but also in various other fields such as the environment, labor and welfare. How do the German people see Germany? A. Germans are critical people and when we receive a question like that dozens of problems that must be addressed come to mind. But to mention just three things, first, problems arising from demographic changes have to be solved. Policies that enable a balance between work and family are urgently needed. Second, over the past 10 years the gap between the rich and the poor in German society has widened significantly. It’s likely the situation is the same in other countries, but income rooted in capital is growing much faster than income from labor and it is important that this issue be addressed. Because Germans place

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great importance on agreement, as well as social justice and welfare, this gap between rich and poor must be solved. Third, as Germany has a very complicated democratic structure, there are many routes for the citizens to take part in decision-making. As there are many opportunities for people to take part in everything from policy-making to politics and administration, it is very difficult to reach a decision on projects such as large construction projects. When building a subway station or airport, for example, Koreans discuss the project for about 3-4 years but in Germany it might take more than 20 years. To develop further, Germany must ease the complicated decision-making process and simplify communication. Q. As I have been saying, Koreans want to learn from Germany in terms of policies, education and welfare. They also rate highly German cars and products and the nature of the German people. A. Although I am German, sometimes I look at the country through the Korean people’s eyes and it looks like a land of miracles. Germans are actually critical of their own country, and I too am the same way. It was when I came to Korea that I realized what a good country Germany is. Q. If there are aspects that Koreans misunderstand or overrate, what would they be? A. The way I see it, Koreans’ view of Germany is not a matter of overrating or underestimating. Koreans tend to compare countries in terms of the problems they may have and how well they cope with and overcome those problems. Take the pension system or the medical insurance system, for example. Koreans compare these things in other countries and are very good at benchmarking the things you need for development. The Germans should be learning from the way Korea is energetically benchmarking things German in order to achieve systematic development of the country. We should be learning from such analytic benchmarking. Because economic democratization is well developed in Germany, the system allows for workers to take part in management. Workers and employers are called social partners and their relationship is not about protection of workers but leading the company together. Such things, I believe, are underestimated in Korea but they are very distinctive strong points of Germany.

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Q. How do the other countries in the euro zone perceive Germany? A. Germany is close to all countries of the EU and as reflected in the recent BBC poll, the French and English perception of Germany has improved. Generally speaking, the EU member nations all have a positive image of Germany. Of course, countries which now face serious restructuring because of the euro crisis are very critical. But from the Greek case alone you can tell that Germany’s image is mostly good. Germany is now surrounded by allies and in this we take pride. Q. Germany is seen as a role model for reunification, and particularly its social cohesion after reunification. What aspects should Korea learn from Germany’s reunification model? A. I don’t think Koreans see Germany as a good model of reunification. Or rather, to correct myself, Germany was reunified through absorption and, because that is the hard way to go about it, Korean’s don’t seem to take it as a good model. Although it’s true that Korea is studying German unification, it is doing so in order to avoid making the same mistakes and to find a solution that is right for Korea, and of course, to see how unification can be achieved structurally. And while Korea seeks to learn several concrete factors, the major one is Germany’s “eastern policy” [Ostpolitik, foreign relations policy toward Eastern Europe]. This supra-partisan policy was steadily implemented from 1969 to 1989, and had many implications. It is also important to remember that through its eastern policy, Germany continued personnel and economic exchange over 20 years. In the 20-year period before reunification, West Germany made diplomatic efforts to build up trust with neighboring nations. So when the time was ripe for reunification, it gained the support of powerful nations and other neighbors in Europe. West Germany took the initiative and laid the foundation that made reunification possible. Such factors are interesting when we think of unification of the Korean peninsula. Q. Even after unification, an economic and cultural gap remains between the former West Germany and East Germany. A. Political unification has been completely achieved. Economic unification will also be complete by 2019, three decades after the collapse of the Berlin Wall. By that time, the former East German regions will reach a similar economic level to

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that of West Germany. Currently, East Germany’s per capita income remains at 73 percent of that of West Germany and its labor productivity at 80 percent. Although a gap remains, positive changes are apparent. The unemployment rate is decreasing in the East at a faster pace than in the West. While many people migrated from the East to the West in the past, these days the number of people moving either way is about equal. The birth rate is also the same, as is the standard of living. Places such as Thueringen and Sachsen in East Germany have an economic level similar to that of the federated states of West Germany. Q. Does Germany have a role to play in the unification of South and North Korea? A mediating role, perhaps? A. (Ha, ha) If it would help unification of the Korean peninsula, Germany is ready to provide all its experience to South and North Korea. But we must remember that from the North Korean point of view, German unification, which was unification by absorption of the East by the West, may not be considered desirable. [December 25, 2014]

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Takashi Uemura: “My Article on Comfort Women was Not Fabricated.”

Former Asahi Shimbun reporter Takashi Uemura holds a press conference in Tokyo on January 9, after filing a lawsuit against Japanese media outlets that claimed his coverage of "comfort women" was fabricated.

Gil Yun-hyeong Tokyo Correspondent The Hankyoreh

“It still feels as if I’m in a dream. Why is this happening to me?” Takashi Uemura, 56, former reporter for the Asahi Shimbun, let out a deep sigh as he buried his head in his hands. There were no words of comfort to offer. All I could do was just watch him in silence. Amid the heated battle over the issue of wartime “comfort women” that is ongoing in Japan, Uemura is in a unique position. He was one of the first to write an article about Kim Hak-sun (1924-1997), a former comfort woman from Korea who was the first to step forward with her story, which was published in the Asahi Shimbun on August 11, 1991. The Japanese right have branded him a traitor for writing a “fabricated report” and causing immeasurable damage to the country’s national honor and interests. But to the liberals, who believe that resolving the issue of comfort women is the first step toward a better Japan and peace in East Asia, Uemura is their ultimate “bastion” that must not crumble. We met with Uemura at an office in Sapporo, Hokkaido on December 16 and 17. During the past year he helplessly endured vicious attacks leveled at him by right-wing groups while the Japanese government conducted verifications of the 146

1993 Kono Statement (considered a formal apology that acknowledged the involvement of the Japanese military in World War II sexual slavery of women from other countries). What we found through the interview was a distorted portrait of Japanese society. Q. You first wrote about Kim Hak-sun 23 years ago. What did you have to go through this past year as a result of that article? A. It all began in late January last year when the weekly magazine Shukan Bunshun published an article in its February 6 issue. The article titled “Former Asahi Shimbun Reporter Who Fabricated Reports on Comfort Women to Start Teaching at Women’s College” defamed my appointment as a professor at Kobe Shoin Women’s University starting in April. A few days later, on January 31, I received a call from the executive secretary of the school who asked to meet me, and on February 5, I met with the school’s vice president and executive secretary at a hotel in Kobe. Since I had not fabricated the article I was sure that if I explained everything they would understand. But when I handed them the materials that I had prepared, they said, “This is not a matter of the authenticity of the article. This is going to adversely affect our student recruitment as well as tarnish the school’s image.” It was most regrettable since I had not fabricated anything. My employment contract was revoked on March 7. I didn’t realize then that this was not the end, but just the beginning. Around the time right-wingers in Japan began their malicious attacks against Uemura, the Japanese media, including the Sankei Shimbun, started bashing the Kono Statement that acknowledged the forced mobilization of women for sexual slavery. It was a means of shifting the dispute over comfort women — a longpending diplomatic issue between Korea and Japan — in their favor. On February 20, chief cabinet secretary Yoshihide Suga announced plans to set up a team to verify the Kono Statement, and on June 20, the team published a report that undermined the legitimacy of the statement. With the Abe administration dismissing the credibility of the milestone statement by former chief cabinet secretary Yohei Kono, right-wingers needed a target to vent their anger. Hiroshi Yamada, a Lower House member of the Party for Future Generations, who played a decisive role in the government’s verification of the Kobe Statement, even stated that Uemura should be summoned to appear as a

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witness before the National Diet. Even Hokusei Gakuen University, which had hired Uemura as a part-time lecturer, came under attack by right-wingers. Q. Why do you think you have become a target of right-wing groups? A. I still can’t grasp the reality of the situation. There were other reporters who wrote similar articles when Kim Hak-sun first openly testified, so I don’t understand why they’ve singled me out. In 1990, when I was a city desk reporter working at the Osaka headquarters of the Asahi Shimbun, the desk was planning a special feature on peace and suggested digging up stories about former comfort women in Korea. That summer I traveled around Korea for two weeks to gather materials, but was unsuccessful. A year later, the Seoul Bureau head told me that he had found a former comfort woman and suggested I come over to cover the story. On August 10, 1991, I met with Yun Jeong-ok, co-representative of the Korean Council for the Women Drafted for Military Sexual Slavery by Japan, and I was able to listen to the recorded testimony of Kim Hak-sun. Although I wasn’t able to ask questions in person, I thought it had great significance in that it was the first time a former comfort woman from Korea had come forward and broken the long silence. Right-wingers claim that my coverage of Kim Hak-sun’s testimony sparked international interest in comfort women and made it into the big issue that it is now, when in fact it came under the spotlight when Kim Hak-sun held a press conference on August 14 that same year. If there is any reason for their hostility, all I can think of is that my wife is Korean and my mother-in-law is Yang Sun-im, president of the Association of Pacific War Victims. Also, my mother-in-law was indicted on charges of fraud relating to postwar compensation litigations (found not guilty in August last year). Right-wingers are spreading propaganda that “Uemura fabricated the article for his mother-in-law.” When I was working as a Seoul correspondent between 1996 and 1999, I tried to avoid the topic as I didn’t want to give them an excuse to point fingers at me and say, “Yang Sun-im’s son-in-law is writing articles about comfort women.” Q. How did you become interested in Korea and the issue of comfort women? A. In 1978, I entered Waseda University, and in 1982, the Asahi Shimbun. It was a period of tumultuous change in Korean politics. In 1979, President Park Chunghee was assassinated and in May 1980, the Gwangju Democratization Movement took place. In 1981, Kim Dae-jung was sentenced to death (commuted to life

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imprisonment shortly afterward). When I was in college, there was a KoreanJapanese in my dormitory. He was a student at Seoul National University College of Medicine in the 1970s, but had returned to Japan for fear of being implicated in the espionage cases of Korean-Japanese students. Through him, I was able to learn about Korea and the discrimination against Koreans living in Japan. I traveled to Korea in 1981, and during my college years also took part in the movement opposing the death penalty for Kim Dae-jung. In 1987, I had the chance to visit Korea again for a year-long language course. The long dictatorship in Korea was drawing to an end and the country was beginning its transition to a democratic state. During the presidential election in 1987, I attended the campaigns of the candidates Kim Young-sam, Kim Dae-jung and Roh Tae-woo in Yeouido. (In October 1987) I also went to the inauguration of The Hankyoreh at YMCA hall in Myeong-dong, Seoul, and met Song Kun-ho (the newspaper’s first president publisher). When I began working as a city desk reporter in Osaka in January 1989, I was in charge of covering stories about Korean-Japanese and Koreans living in Japan. As a Seoul correspondent for the Asahi Shimbun, I covered Kim Dae-jung winning the presidential election in December 1997. Q. Right-wingers have branded you as a “fabricator.” What do you have to say to that? A. I did not fabricate the report. They have leveled harsh criticism at me claiming that I confused the terms “female volunteer corps” (yeoja jeongsindae) and “military comfort women” (jonggun wianbu), and also that I didn’t mention the fact that Kim Hak-sun had attended a gisaeng school before being conscripted as a comfort woman. But as many academics have already acknowledged, when the comfort women issue was first brought to light, both Korea and Japan used the two terms synonymously. Also, a gisaeng school is where women were taught how to dance and play instruments at drinking parties, and it does not necessarily mean the women there ended up as comfort women. The Yomiuri Shimbun has been bashing me for those very reasons when in fact their articles written back then also mixed up the terms female volunteer corps and comfort women, and never mentioned that Kim Hak-sun went to a gisaeng school. Also, I never wrote that Kim Hak-sun was “taken forcibly.” Personally I don’t think that there was any forcible mobilization of comfort women in Korea, and any hard evidence of such has not yet been found. What Kim Hak-sun also consistently stated was not that she was taken by force, but that she was “deceived” and “went against my will.”

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In my article, I wrote that “women were taken under the guise that they would be joining the female volunteer corps when in fact they were forced into sexual slavery for the Japanese military.” When I say “taken” I don’t mean as the rightwingers contend that women were hunted and carried off like prey. I didn’t write a single article based on Seiji Yoshida’s account (that he hunted women on Jeju Island and took them by force), which was found to be false. Q. When the attacks by right-wingers were at its height, the Asahi Shimbun published an article that backed your reporting on comfort women. A. On August 5, Asahi published the outcome of its verification and confirmed that my article was not fabricated. I thought that I would be able to recover my reputation. But the attacks became even more vehement. That was the time when I was completely at a loss and felt all alone in the world. Things started to turn around when right-wingers began targeting my daughter. People were enraged that they would go so far as to go after a young girl. Supporters like Takashi Shinzai, 85, a former high-school teacher whom I had kept contact with, came forward and formed a support group. One citizen posted on Facebook an appeal to support Hokusei Gakuen University. All these were instrumental in turning the tide. Then on September 30, the Mainichi Shimbun reported that a literature professor at Tezukayama Gakuin University in Osaka, who was a former Asahi Shimbun reporter, had to step down due to mail threats. This prompted other newspapers, which had largely kept silent about my issue until then, to report that a similar situation was happening in Hokusei Gakuen University. Riding this wave, 444 scholars, lawyers and journalists from around the country came together on October 6 and formed the “Don’t Succumb Hokusei” gathering. And on November 17, Hokusei announced extension of my teaching contract for another year. Q. What have you been doing since you left the newspaper? A. The retirement age at Asahi is 60, but if you opt for the wage peak system, you can work until 65. I had been accepted for a professorship at the women’s university in Kobe, so I left the newspaper at 55. But my only source of income at the moment is the small fee I get paid as a part-time lecturer at Hokusei Gakuen University. I started a doctoral program at Waseda University at 50. My dream was to write and teach students in college. Many reporters in Japan wish to

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become a professor, so professorship positions are highly competitive. I made it to the interview round a number of times, but each time, the comfort women article became an obstacle. After many attempts, I was finally accepted at the women’s university in Kobe. I worked as a correspondent in Tehran, Seoul and Beijing, and have written many books. But even if I complete the doctoral course and get a degree, I know it will be difficult for me to find a teaching job at any university. I’m seized with fear when I think about that. Q. What are your views on the recent situation in Japan? A. I am a patriot. I love my country, and want it to become a respected country in Asia. In order for that to happen, we need to apologize to our neighbors when an apology is due, and rectify things if that is what is required. Without properly liquidating its past, Japan cannot earn the respect and trust of other Asian countries. Japanese society today is distorted. When I wrote the article about Kim Hak-sun, I was 32. I remember writing, “Fifty years after the end of the Pacific War, we are slowly beginning to shed light on the dark side of our history. Ignoring this would be turning our backs on and refusing to help the old ladies [former comfort women].” This is also what the young Uemura is saying to the 56-year-old Uemura of today. Until now I have deliberately tried to evade the issue of comfort women, but not anymore. I’m not going to look away, but confront it. Since I have nowhere to run, I have no choice but to face my attackers head-on. There are certain groups in Japan that are launching assaults against those who are trying to face up to our dark past. But there are also those that refuse to submit to such threats and continue to voice their opinions. More than anything, I’m happy that I will be able to continue teaching next year. I did not fabricate the article. I will remain undaunted in the face of undue attacks and continue fighting to the end. [December 22, 2014]

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Nambusunhwanno, Seocho-gu, Seoul, 137-863, Korea Tel: (82-2) 2151-6526 Fax: (82-2) 2151-6592 E-mail: koreafocus@kf.or.kr ISBN 9791156041290 05050 Publisher Yu Hyun-seok Editor Lee Kyong-hee Editorial Board Shim Ji-yeon Professor, Kyungnam University Lee Ha-won Director, TV Chosun Kim Yong-jin Professor, Ajou University Hyun Jung-taik Professor, Inha University Hahm In-hee Professor, Ewha Womans University Sonn Ho-chul Professor, Seogang University Kim Gyun-mi Deputy Editor, The Seoul Shinmun Kim Hoo-ran Senior Journalist, The Korea Herald Peter Beck Korea Represetative, Asia Foundation Jocelyn Clark Professor, Paichai University ⓒ The Korea Foundation 2014 All rights reserved.

152

Box

227,

Diplomatic

Center

Building,

2558