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Table of Contents
- Korea Focus - November 2014 - TOC - Politics 1. Constitutional Amendment For What and For Whom? 2. Beyond a Nasty Brand of Progressivism 3. Cheong Wa Dae’s Worrisome Inflexibility 4. Time to Close the Sewol Ferry Controversy 5. Preparing for Unification Wisely
- Economy 1. Is the Korean Economy Really in Dire Condition? 2. Traps Lurk in the Huge China Market 3. Another Financial Crisis is Coming 4. Is the Korean Won Too Strong? 5. Imprudent Attempt to Revive Apartment Boom
- Society 1. Launch a Public Forum on Welfare Taxation 2. Ways to Shed No. 1 Title in ‘Population Extinction’ 3. Aggressive Society and the Internet 4. Living as an Emotional Labor Provider
- Culture 1.Validation Delayed for the Oldest Movable Metal Type 2. CCTV, Dilemma between Privacy Protection and Public Interest 3. Priorities in Tourism Policy 4. Truth about the Young Patriotic Martyr Yu Gwan-sun
- Essays 1. Analysis of Business Operations at Kaesong Industrial Complex 2. Class Self-Identity and Life Satisfaction
- Features 1. Gilt-bronze Burial Shoes Showcase Baekje Artisans’ Exquisite Craftsmanship 2. China Dream or China Black Hole? 3. Why Do So Many Koreans Drop Out of U.S. Schools?
- Book Reviews 1. Toward Justice in Korean Capitalism 2. Changing Names: Laundering Family Records of Slavery
- Interview 1. Ahn Hwi-joon: “Repatriating cultural properties requires wisdom of a hunting lion.” 2. Seung Hyo-sang, Seoul’s First ‘City Architect’
- COPYRIGHT
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- Constitutional Amendment For What and For Whom? - Beyond a Nasty Brand of Progressivism - Cheong Wa Dae’s Worrisome Inflexibility - Time to Close the Sewol Ferry Controversy - Preparing for Unification Wisely
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Constitutional Amendment: For What and For Whom?
Kim Hyung-o Chair Professor, Pusan National University Former National Assembly Speaker
The head of the ruling Saenuri Party ignited a political firestorm when he suggested a constitutional amendment to restructure the executive branch of government. Then he had to retreat when President Park Geun-hye expressed concerns that a constitutional debate would create a distracting “black hole,” in which economic matters and other pressing issues disappear.
The president and the ruling party leader obviously have subtle differences in their concept of power. It derives from a lack of understanding between the two, which would make a constitutional revision hard to materialize. Nevertheless, a constitutional revision remains a major pending question in Korean politics. The proposed constitutional revision would split the president’s current duties. The president, chosen by popular vote, would be in charge of the nation’s external affairs, such as foreign relations and national defense, while a prime minister chosen by the legislature manages internal affairs.
Those who insist on keeping the existing Constitution intact claim that many reasons advocated by revisionists stem not from flaws in the basic law but from its mismanagement. They also argue that, in the prevailing circumstances stained by social friction and lack of leadership, moves for a constitutional change will widen the split in public opinion and exacerbate social disintegration. They have 5
a point there, but let’s coolly retrace our footprints.
Since the present Constitution was adopted in 1987, we have elected six presidents, each with a fiveyear single term. But, five of them suffered unfortunate experiences involving their offspring, if not themselves, in the closing days of their tenures. Is it a sheer coincidence? I think it is a tragedy of “bloated presidential power” resulting from the concentration of power held by the chief executive in the absence of proper institutional checks and balances provided by the Constitution. As long as the basic law bestows omnipotent power on the president, there is no way to prevent arbitrary rule and extreme opposition, lame duck syndrome and corruption of aides.
Against this backdrop, it is too simple-minded to attribute the causes of such mishaps and responsibility to mismanagement of the basic law, rather than institutional flaws. Any ill fortune of a president is a misfortunate for the public and a disgrace to the country. The people should no longer be bound to such a defective system.
Time Frame and Elements of Amendment Ironically, the greatest obstacle to a constitutional amendment rests in the basic law’s provisions. Be it aimed at setting up a parliamentary cabinet system, dual executive system or two four-year presidential terms, a revision can hardly be realized unless it is processed at an opportune time: a year when both the parliamentary and presidential elections are held would be best.
In light of the constitutional provisions that explicitly prohibit any changes to the existing tenures of National Assembly members (four years) and the president (five years), who is barred from seeking a reelection, such a year comes only once every 20 years. The next such year is 2032. That is too far away for all of us. The nation’s future hinges on the Constitution. Hence its revision is a task in which partisan interests and political calculations of any kinds must be put aside. It is deemed preferable to undertake the revision during the early phase of a president’s tenure when prospects for the successor remain undecided, rather than later when the next presidential race is taking shape. The nation’s Constitution, despite its many merits, has to be amended because of the following critical defects. 6
First, as mentioned above, the president under the current Constitution has abnormally bloated power and suffers a rapid fall to lame duck status. The president enjoys not only a broad range of executive power but also authority to initiate legislation, manage budget and audit public organizations, either stipulated by laws or guaranteed by traditions. The presidential power in our nation is stronger than that of any other country, deserving to be called an “imperial” presidency.
The mighty power, however, begins to wane rapidly at about the midterm. All the while, the singleterm president is destined to face vehement resistance by opposition forces, creating chronic political and social unrest. As the vicious circle repeats, the lame duck syndrome intensifies, dragging down governance ever so severely.
Second, the discord in the National Assembly and presidential terms incur exorbitant expenditures. Almost every year the nation has major elections ― presidential, parliamentary and/or local elections plus by-elections ― with the rush of hollow populist pledges. In addition to the outlay of public funds, psychological and emotional problems aroused by heated election campaigns disrupt social stability. The third defect concerns the National Assembly’s incompetence and irresponsibility. The executive branch has steadily expanded its authority over the years. It now overshadows the legislative function of the National Assembly which has little authority to check the chief executive. Annual inspection of the administration and interpellation of cabinet members are just about all the power the enfeebled legislature currently has. The National Assembly’s weakened functions resulting from the absence of both institutional devices and expertise on the part of individual lawmakers has led to irresponsibility and incapability in the legislative branch. Borrowing from the U.S. system, confirmation hearings have been introduced for the appointed senior officials. But the hearings have been poorly conducted, causing widespread public skepticism about the merits of the procedures.
Lack of Dialogue and Compromise There are other problems that derive from the Constitution. The lawmakers have somehow made it a rule to breach statutory laws by themselves. For example, the National Assembly has never honored the constitutional provision that stipulates a national budget bill should be passed by the legislature no later than December 2, or a month before a new fiscal year begins. 7
No less problematic is the provision that imposes a 60-day limit to national budget deliberations. The time span was decided when the budget amounted to about 10 trillion won. The latest budget reached 350 trillion won, so parliamentary scrutiny was grossly insufficient. Even worse, the lawmakers seldom spend all of the 60 days allowed for budget deliberations. Furthermore, debate oftentimes turns into political bickering to the dismay of the public.
Because the present Constitution was hurriedly written in the wake of the 1987 pro-democracy movement, several provisions do not fit reality or have proven to be inadequate to cope with evolving developments. Ironically, some provisions contain traces, if not replicas, of the oppressive elements of the Yushin (“revitalizing reform�) authoritarianism. The existing Constitution does not have provisions that hold legislators accountable if they violate the basic law or fail to carry out their duties and obligations.
An outstanding feature of the Constitution is its disreputable outgrowth: a system that is more suitable for conflicts than dialogue. Because the president distinctly enjoys far mightier power than the legislature, neither side is much interested in having a sincere dialogue or making compromises. The more powerful side tends to regard dialogue as a waste of time, while the weaker party believes struggle is more effective in reaching their goals.
That is why the National Assembly is in a constant confrontation mode. In the first half of its term, the aftermath of a presidential election stokes confrontations and in the second half, the run-up to the next presidential election keeps the feuds raging. In disregard of the disgusted public, party leaders encourage lawmakers to engage in the political brawling as a means to ensure their future careers.
Of course, the Constitution cannot be blamed for all the deficiencies and negative side effects. But, unless a democratic division of power is achieved through a constitutional revision, the distorted political landscape can never be fully mended by mere changes to subordinate laws.
Key Points at Issue Although some insist that the Constitution has to be amended in its entirety, from the preamble to supplementary provisions, their all-inclusive argument makes an amendment even more unrealistic. Similarly, a revision that only modifies big frames, such as articles concerning power structure, without addressing essential details, would be inappropriate. 8
A revised constitution needs to meet the needs of the 21st century such as local autonomy, human rights, and information and communications technology. The interrelations between the president and the legislature, the people and the legislature, and the people and the government also must be addressed.
A superficial approach to merely shifting the axis of power may end up aggravating the situation. Should the existing single five-year presidential term be altered to a maximum eight-year tenure (two four-year terms) without amending provisions related to power concentration, it would be tantamount to paving the way for a single eight-year presidential term.
If either a dual executive system or a parliamentary cabinet system is adopted in the format currently being debated as two of likely options, it is possible that the next government would become prey to a political merry-go-round. A superficial alteration in the absence of substantial content renovation will have no value to the country. Next year is the only year during President Park’s five-year term when no major elections will be held. If the National Assembly gains the people’s trust and political leaders, including prospective presidential candidates, make sincere and earnest approaches, full-fledged debate and moves will likely take place during the year toward a meaningful constitutional amendment.
A majority of National Assembly members are in support of a constitutional revision with an obvious intent to have their legislative power expanded to levels seen in advanced countries. However, unless the National Assembly sheds its outmoded practices, the people will never bestow greater authority upon the legislature. For what and for whom should the Constitution be rewritten? At the center of the question are the people, always. It is most important to win the public’s empathy, consent and trust in carrying out the task, from debate to the final legislation. Both motivational impetus and driving dynamism will come from the people. If the National Assembly performs its legitimate function and assumes responsible posture from now on, the people will be forthcoming to give a clear mandate with trust to the legislature, which will enable constitutional changes.
[Dong-a Ilbo, October 23, 2014]
www.koreafocus.or.kr
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Beyond a Nasty Brand of Progressivism
Kang Joon-mann Professor of Mass Communication Chonbuk National University
“They have no interest in transforming society. They are interested only in doing their own work and discovering themselves. They want ‘revelation,’ not ‘revolution.’”
This is what Saul Alinsky, an American community organizer, said about neo-leftist student activists in the 1960s. He accused the neo-leftist students of trying to use radicalism to build a "world of their own" and thus alienating the public, instead of implementing strategies and tactics in conformity with the "world as it is."
In an editorial, The Hankyoreh has defined the main opposition New Politics Alliance for Democracy as a kind of "pandemonium reminiscent of a ship about to go under." Watching the wretched reality facing the NPAD, I was reminded of the abovementioned scathing comment Alinsky made.
NPAD lawmakers don't recognize the "world as it is." They consider such recognition a wrongful compromise. Regardless of trends in public opinion, they always believe that the "public opinion is not always right." They look happy-go-lucky even when approval ratings of their party remain at half the level of the ruling Saenuri Party's ratings. If they were civic activists, I would even admire their "dignified demeanor" of focusing only on propaganda about their identity and conviction, being indifferent to victory and success in the "real world." 10
But they are members of a political party, an entity that should accept compromise as its basic modus operandi. Even if their opponents are of "a rogue party," they should still accept them as partners in efforts to seek compromise if such an opponent party has larger power than their own party in the "world as it is." This is all the truer even if they decide to take to the streets, brandishing fire bombs.
A columnist of the Chosun Ilbo has written, "Opposition parties are calling for 'truth about the ferry disaster,' because they want to turn their attack against Cheong Wa Dae in order to eventually shake up President Park Geun-hye." The Hankyoreh criticized this argument. But now it is time for us to look back on ourselves.
Opposition circles have attached such great importance to "Park's mysterious seven hours" of disappearance from the public eye on the day when the ferry sank, during which her whereabouts were unknown, that the ruling circles have become suspicious of their motives, haven't they? Hankyoreh editorial writer Kim Jong-koo wrote on August 28 an article titled “A special bill on the ferry disaster, the key to solving 7-hour mystery." He wrote that Cheong Wa Dae and the Saenuri Party go into convulsions at the mere mention of "the 7-hour mystery" and that in private meetings, some presidential staff members have grumbled, "Opposition circles should promise not to take issue with the seven hours of Park's absence, shouldn't they?"
Paradoxically, this shows there is no possibility that Cheong Wa Dae and Saenuri will accept opposition circles' demand, as long as they remain so adamant about the "7-hour mystery." It would be an agenda item that nobody can abandon, if it is a decisively important part of the effort to create a "safe world," which the families of the victims desire so ardently. Is it really so important? Nobody would disagree with Kim's views expressed as follows:
"In fact, the investigation to be conducted in accordance with a special law would focus on the clumsy initial response by the government, including Cheong Wa Dae, to the ferry disaster. The other issues could be resolved through prosecutorial investigations and most of the problems have already been revealed."
Under these circumstances, should opposition circles stake everything on an unwinnable battle over the 7-hour mystery? Or, should they gain more and seek politics of compromise on the progressive agenda about people's livelihood in return for making concessions on the 7-hour mystery? Which will 11
ultimately benefit the victims and their families more?
Progressives will most likely be seen as "nasty," if they are bent only on roaring like a lion to make their presence known, rather than trying to transform our society substantially by using their wisdom like a fox. It is conservatives, not progressives, who will benefit when politics becomes an object of disgust and curse as the result of an extreme confrontation with no way out.
It is thirst and hunger for dreams and actions to transform the world at all costs, not a display of sense of righteousness and moral superiority that progressives badly need.
[The Hankyoreh, September 22, 2014]
www.koreafocus.or.kr
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Cheong Wa Dae’s Worrisome Inflexibility
Yang Sang-hoon Chief Editorial Writer The Chosun Ilbo
The strangest part in the public debate over the introduction of a special bill on the April 16 ferry disaster is that families of the victims and opposition parties have not clarified what they think is insufficient about prosecutors' investigation.
The official investigation blamed the ferry sinking on illegal renovation of the ship, overloading, loosely secured cargo, inadequate ballast water, and poor handling of the vessel. The ferry's captain and crew also fled without any attempt to rescue passengers and Coast Guardsmen had neither rescue training nor necessary equipment.
The litany of factors suggests that there is nothing more to reveal. But many people are still demanding a further probe by a special counsel with extra-judicial authority. They should precisely identify what they want to be investigated further. But they are only saying the truth needs to be unveiled. Some of them are even insisting that media companies should also be investigated.
In the initial hours of the sinking, when the situation was murky and confusing, TV networks incorrectly reported that all the passengers were rescued. This wrong report, however, did not contribute to the sinking or any deaths. When the victims’ family members and their supporters are asked why media outlets should be investigated, they reply, "If nothing is found after all, then it'll be no big deal." 13
This kind of unreasonable demand is a reminder that deep in their hearts, they suspect that the ferry sank after it collided with a U.S. Navy submarine or it was blown up by an agent of the National Intelligence Service. Then as it stands, what they badly need is not the "truth," but a chance to satisfy their grudge.
President Park Geun-hye has emerged as a primary target of their anger. Traditionally, Korean people have tended to attribute massive disasters to their rulers. But just the same, the argument that the ferry sank because of Park or that rescue efforts were stymied because of her is irrational. Park received the first report on the ferry incident at 10 a.m. By then, the ferry had already listed about 90 degrees. Even if she had been right beside the ferry at the time, it would still have been impossible for her to do anything.
Nevertheless, many people still want to know where Park was and what she was doing. Even those who do not think she was responsible for the disaster are curious about it. The farfetched argument about the need for a special bill is coming to a head due to this kind of widespread curiosity.
Many people work at Cheong Wa Dae. It is impossible for the president to sneak out or meet anybody without being noticed. If there had been anything extraordinary about Park's activities on the day of Sewol sinking, it would already have been disclosed to the public.
At the time, Park was said to be coming and going between her office and her residence as usual. But Kim Ki-choon, the president’s chief of staff, abruptly sparked public speculation about Park's whereabouts. In answering a question from a lawmaker, Kim said he did not know Park’s whereabouts. Furthermore, Kim said he did not know when Park arrived at her office on the fateful day. People were taken aback by what Kim’s answer suggested about the work environment at the presidential office. Hence, Park has become a target of people's anger, and the entire country has been thrown into a whirlwind since the controversy erupted over the special legislation on investigating the Sewol disaster. In a sense, it is as if Cheong Wa Dae has reaped what it has sown. Kim’s answer reflected the many things inside the chief executive’s office that defy common sense.
It has been reported that on the day the Sewol sank, nobody sat face to face with Park to brief her on 14
the disaster. But that type of inaction is normal at Park's Cheong Wa Dae.
Some cabinet members never met Park one on one until the moment they left their jobs, so the prime minister once asked her to meet them individually. Even some senior presidential secretaries working at Cheong Wa Dae have had no chance to meet Park face to face. Of course, the president can do her job only by reading reports and receiving phone calls in her office. But this goes against common sense.
When she was a first-term lawmaker, Park had her chief of staff, a kind of senior executive aide that even multiple-term lawmakers never dream of hiring. The public opinion that today's Cheong Wa Dae is more inflexible than that of former presidents Kim Young-sam and Kim Dae-jung, who were reputed to be more authoritarian than soldiers-turned-dictators, probably has something do to with Park's style. Kim Ki-choon said he had no idea of Park’s whereabouts allegedly to spare her from any trouble if it was revealed that she was in her residence, not in her office.
American presidents have made many of their important decisions at their residence. Kim should have said simply, "She was in her office and in her residence." We have come this far, just because the presidential chief of staff feared the possibility of any damage to the president's reputation. When he makes presidential decisions public, Kim always begins his statement with "honoring the wishes of my superior." I can understand how weird that sounded to people.
Under these circumstances, a cabinet member was fired after he presented his own views different from the president's. Park is paying the price for this kind of inflexible and nonsensical work environment that she has created at Cheong Wa Dae. If things go on this way, more problems will arise even after the controversy over the ferry disaster is resolved.
[September 18, 2014]
www.koreafocus.or.kr
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Time to Close the Sewol Ferry Controversy
Lee Tae-dong Professor Emeritus of English Sogang University
Five months have elapsed since the fatal sinking of the Sewol ferry, and the ensuing funerals for the hundreds of victims. However, the bereaved families remain numbed with grief.
In our age-old custom, funeral services are usually conducted on the third day after death, but sometimes on the fifth day under special circumstances. This is due to the notion that bereaved families should not feel overwhelmed for too long, which would be against wishes of the deceased.
In discussing human dignity with regard to funeral rites, Confucius noted that the most proper funerals have expressions of profound reverence to the departed, followed by rites. The worse forms, he said, were displays of exaggerated grief and wailing to the point of exhaustion and sickness. He further cautioned that expressions of despair must befit one’s real emotion and status.
Accordingly, what a sorry situation we face today. Family members of Sewol victims and political activists claiming to be defenders of the families have continuously staged emotional sit-ins, behaving like mourners exhausted from resentment and hatred. They have turned Gwanghwamun Square, the cultural symbol of Korea in the heart of Seoul, into an ugly mourning site stained with brawls for rights and interests.
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The situation is not limited to physical presence. The families, backed by intransigent members of the main opposition New Politics Alliance for Democracy, have rejected a compromise bill worked out through hard negotiations by floor leaders of the ruling and opposition parties to meet their stiff demands. Their objection, obviously orchestrated for political gain, has frozen legislative activities at the National Assembly, where urgent bills are piling up, hamstringing the administration’s attempt to deal with economic hardships. The families “in quest of truth” demand the formation of an independent fact-finding panel that would have the power to investigate and indict anyone responsible for the ferry sinking, regardless of the person’s position. However, the government and ruling party are against their request for special empowerment, in particular, on the grounds that it contravenes the judicial system in principle and even the Constitution.
As for the claim by the grieving families that President Park Geun-hye had pledged the enactment of a special law on the disaster, she has responded that her promise was to create a statute within legal and judicial bounds, not an extra-judicial body sought by the families.
The presidential office and the governing party are apparently determined not to make further concessions because they suspect the bereaved families and hard-line oppositionists are plotting to neutralize President Park in an attempt to seize power through the next parliamentary and presidential elections. In light of the difficulties to enact a special law on the ferry disaster, the ruling party has tried to separate its legislation from the deliberation of other urgent bills related to the national economy and public welfare.
Of course, the grief and pains of the parents who lost their children in the seawater must be indescribable. However, it is utterly undesirable to watch their deep skepticism, hatred and resentment drive the whole nation into confusion and hobble its governance. The majority of citizens are anxious to see the victims’ families emerge from behind the curtain of death soon. The ferry disaster is indeed a tragedy that cannot be easily forgotten. But, the nation should no longer be left drifting because of the disaster. We know that the sun will rise again no matter how dark the night is today. We must “drive our cart and our plow over the bones of dead,” as English poet William Blake said.
[Munhwa Ilbo, September 16, 2014]
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www.koreafocus.or.kr
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Preparing for Unification Wisely
Kim Young-sik Assistant Political Editor The Dong-A Ilbo
What does the Presidential Committee for Unification Preparation need to prepare? The 81-member group, which includes 30 academics and eight cabinet ministers, was launched on July 15 and had its first formal meeting on August 7 with President Park Geun-hye in attendance. The second meeting, a workshop, was held in early September, just before the Chuseok (Korean Thanksgiving) holiday period, to discuss medium and long-term plans for the committee. It is difficult to judge the committee after only two months, but I can’t help but feel frustrated when I hear about its initial activities.
Last weekend the committee formed a task force to draft a unification charter. An international advisory board also is expected to be created to serve under the committee. Former U.S. Secretary of State Henry Kissinger reportedly is on the wish list for the advisory panel.
Disputes already have risen over the makeup of the unification charter, according to a source involved with the committee. Some committee members want the charter to resemble the 1968 National Education Charter. Opponents say it would be pointless to copy a document that has little value other than as material for the national university entrance examination. A former senior government official raised the question, “Hasn’t the time for making a charter to promote the public consciousness for unification already passed?” He added, “How can we develop 19
the big picture if we are just sitting around trying to revise wording of a charter instead of determining Korea’s precise position in a rapidly changing international environment?�
Of course, establishing links to prominent foreigners like Dr. Kissinger is an important task. I know this is still just in the realm of ideas, but I wonder what role Dr. Kissinger can play given that he has reached the ripe old age of 91 and is recovering from heart surgery.
A bigger problem is that the Ministry of Foreign Affairs, Ministry of Unification and related organizations already gather the views of eminent scholars like Dr. Kissinger. Is it really necessary for a presidential committee to duplicate the work being done by government agencies? There is a high probability that the committee will only be able to hear the views of global experts only a few times.
In terms of inter-Korean relations, while there were times when dialogue blossomed, more often than not confrontation deepened. During the Cold War era, all we had to do was strengthen relations with the United States. International politics nowadays is characterized by an escalating military faceoff between the United States and China. At the same time, China and Japan have adversarial relations while Tokyo seeks to improve relations with North Korea. In short, the climate of the North-South problem has changed.
There has never been a time when the Korean peninsula question was more internationalized. The more players that participate, the more difficult it is to resolve matters exclusively in terms of NorthSouth relations, but we lack anything remotely resembling a dialogue with the North. In order to achieve a breakthrough in this abnormal situation, we need a new way to consider and approach the North-South question.
The presidential committee was launched to meet the demands of the times. Of course, this will not be easy. At a time when the committee is just getting started and having trouble deciding what to do, rather than having preparatory tasks pile up from a sense of obligation, it would be more effective to make a list of what not to do. From this point of view, the committee should not take on tasks or draft simple strategies that can be done by the Blue House and relevant ministries.
In particular, the committee should not squander its resources on churning out documents that already have been produced elsewhere or holding events that have no lasting significance. We already have the Basic Agreement and various other accords with North Korea. The committee is also advised to discard its preoccupation with achieving results. Only if the committee avoids duplicating the tasks 20
of other government offices can it then devise a clear and concise master plan.
[September 11, 2014]
www.koreafocus.or.kr
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- Is the Korean Economy Really in Dire Condition? - Traps Lurk in the Huge China Market - Another Financial Crisis is Coming - Is the Korean Won Too Strong? - Imprudent Attempt to Revive Apartment Boom
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Is the Korean Economy Really in Dire Condition?
Cho Yoon-je Professor of Economics Sogang University
The financial system is often referred to as the lifeblood of the economy. It turns small investment and savings accounts into large investment funds and long-term loans to support business ideas that can create new sources of value added for economic development.
However, financial markets also are authorized casinos. The world history of finance is dotted with excesses, greed, panic and crises. A financial market that appears to be sound can suddenly plunge into turmoil, paralyzing the economy and disrupting the lives of individuals and households. Many countries that have suffered a financial crisis spiral into a long slump, unable to return to their precrisis growth track for many years.
This author has been studying advances in finance and financial policy for the past three decades and has been directly involved in policymaking. Yet, I cannot claim to have a thorough understanding of financial markets. It is difficult to predict when, what and how a shock will roil financial markets and an entire economy. A crisis comes in a different shape each time.
For guidance, the views of Stanley Fischer, vice chair of the U.S. Federal Reserve Board, are instructive. I concur with the speech he delivered in March, when he received an award from the Stanford
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Institute for Economic Policy Research for his lifetime contributions to economic policy. He recounted the 10 lessons he says he has learned over the past 20 years. I would like to focus on some of the important ones.
First, it is critically important to have a strong and robust financial system. Fischer says a notable difference in recovery from a recession has been found between countries with a sound financial system and those without such infrastructure. Second, “macro-prudential supervision� is critical. It is necessary to monitor the soundness of an entire financial system as well as the health of individual institutions. In this regard, it is sometimes necessary to deploy non-traditional policy instruments to deal with potential problems.
Fischer, who was governor of the Bank of Israel in 2005-13, says that the bank, for example, imposed measures that made mortgages more expensive. That enabled Israel to forestall a real estate bubble, sparing the nation from much of the worldwide downturn that followed the 2008 global financial crisis.
Third, a country that manages itself well in normal times will likely handle a crisis effectively. Fischer says it is necessary to maintain fiscal discipline and monetary and financial stability in normal times and follow a sustainable structural policy at all times in order to cushion an economy from shocks. The world economy has had a series of financial upheavals since the 1980s ― international debt crises in Latin America in the 1980s, an Asian financial meltdown in the 1990s and the global financial crisis in 2008 that especially hit the United States and Europe.
A financial crisis stems from runaway borrowing and subsequent deleveraging, which contracts the economy. But the crises in Latin America in the 1980s and in Asia in the 1990s did not lead to longterm global slumps because of credit expansion in the United States and Europe.
Again in the wake of the 2008 crisis, fiscal expansion in the United States and Europe and credit expansion in China prevented a worldwide depression. However, near zero interest rates in advanced economies did not effectively diminish the consequences of the Great Recession, so their central banks resorted to buying government bonds, or quantitative easing.
At present, the fiscal capacity of the United States and European nations is nearly exhausted and their 24
central banks are getting closer to taking the first steps to normalizing their monetary policy. Yet, the global economy has yet to return to its pre-crisis growth trajectory. Stuttering growth has become the norm, and amid the plodding expansion, China’s highly extended debt market, which has created runaway investments, threatens to spark another financial upheaval.
The Korean economy has maintained growth momentum since the 1997 crisis thanks to government spending and increases in national debt and household borrowing. Government-run corporations also have increased their debt load.
However, households can hardly afford any additional loans and some state enterprises are struggling with scheduled interest payments. Moreover, the government’s financial condition is deteriorating as it attempts to strengthen welfare and boost the slow economy without raising taxes.
Given that the Sewol ferry disaster in April dampened consumer spending in the second quarter of this year, growth in 2014 is expected to be below forecasts at the outset of the year. The growth outlook for the second half and 2015 is near or slightly higher than the nation’s growth potential.
Nevertheless, the government is making no deleveraging efforts. On the contrary, debt is on the rise. Economic policymakers are loosening macro-prudential regulations, such as loan-to-value and debtto-income ratios, and attempting to boost growth in the short term by pressuring the Bank of Korea to keep its benchmark interest rate at a historical low.
The Korean economy, which is wide open to the outside world and highly dependent on exports for growth, is vulnerable to both domestic and foreign shocks. Now the question is: Is the Korean economy in such dire condition that the government has to use up all policy tools designed to fight a crisis?
[JoongAng Ilbo, October 18, 2014]
www.koreafocus.or.kr
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Traps Lurk in the Huge China Market
Choe Yoo-sik Digital News Editor The Chosun Ilbo
In the early 2000s, Changhong, a Chinese home appliance maker, had surpassed global titans Sony and Philips in the China market, attracting the attention of a renowned U.S. business school, which did a case study on the fast ascent of the Sichuan Province-based electronics manufacturer.
Some 15 years earlier, when China still had a government-planned economy, Changhong was a military-owned company with abundant cheap labor. It initially brought in assembly lines from abroad, but it did not take long before its engineers built the company’s own assembly lines.
Changhong produced knockoffs, acquired technology and gained price competitiveness. The latter became the key to its success as it produced quality TVs at half the price of imported models.
Headquartered in Mianyang, a small town near Chengdu, Changhong grabbed 90 percent market share in Sichuan Province and became the largest TV maker in China in 1992. Two years later, it advanced to Beijing, Shanghai and other large Chinese cities with 24-inch TVs. During the next two to three years, it swept up the Chinese market.
By 1997, its market share had soared to 35 percent. Foreign companies were helplessly being driven out of the Chinese market. 26
Changhong’s dominance was short-lived, however. It failed to switch from cathode ray tubes used in traditional box-shaped TVs, to flat screens, which became the industry norm in the 2000s. Yet, Changhong’s legendary success against global giants remains embedded in the minds of foreign entrepreneurs.
Foreign companies tend to overlook local counterparts in the huge Chinese market. Chinese companies appear to be too small and too weak in terms of technology to be a serious threat. As such, foreign companies assume it will not be too difficult to dominate the market.
But they find their assumptions are faulty soon after they enter China, and realize they are trapped. Chinese companies, which copy foreign technology in no time, acquire competitiveness in price, keep an edge in regional distribution networks, and quickly catch up with their foreign rivals.
Several European and Japanese companies have had this experience in China. Korean companies, such as Samsung and LG, are no exceptions. What foreign companies learn after paying a high price is that they have to compete against their Chinese rivals in the high-end markets because they can hardly survive at the low end against increasingly capable Chinese companies.
The operating income of Samsung Electronics plummeted in the second quarter of this year. Market watchers believe its performance will be even more disappointing in the third quarter. Declining sales in China are being cited as the main culprit. When Nokia declined two years ago, Samsung took over leadership of China’s smartphone market. The Korean company, which fixated on its new status, revised its strategy. To expand its market share, it flooded the Chinese market with low-end smartphones priced at 100,000 won to 200,000 won. It enjoyed solid performance last year.
But this year, Samsung has had to spend huge amounts of money to defend against Chinese counterparts, who have launched a fierce offensive. As a result, its profitability has nosedived. It is paying a hefty price in its quest to remain No. 1 in the Chinese smartphone market.
[September 4, 2014]
www.koreafocus.or.kr
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Another Financial Crisis is Coming
Cho Yoon-je Professor of Economics Sogang University
We have an inborn capacity to forget painful past experiences and become complacent. That is when financial crises creep into an economy. Few developed nations have avoided this process. “This Time Is Different,” a book coauthored by Carmen M. Reinhart and Kenneth S. Rogoff, both Harvard professors, delves into financial folly and subsequent crises in 66 countries during the past eight centuries. Their conclusion is that policymakers repeatedly assure severe dislocations won’t be repeated but financial crises reoccur nevertheless. Non-performing corporate loans were the main culprit in Korea’s 1997 financial crisis. Korea pulled itself up by pouring public funds into banks and nonbanking financial institutions, but the injection, equivalent to one-third of the gross national income, did not stave off massive restructuring. The nation’s five largest banks came close to collapsing or had to be taken over. Sixteen of the 30 largest chaebol went bankrupt or were taken over by foreign business concerns.
Surviving chaebol and foreign institutional investors benefitted from the infusion of taxpayer money and debt write-downs. Corporations and financial institutions emerged from the crisis with improved financial soundness. But foreign investors ended up with more than half of the traded shares of leading Korean corporations and financial holding companies. 28
Since the 1997 crisis, corporations have improved their risk management in assessing investment options. Before the crisis, they had borrowed to bulk up. They wanted to be too big to fail. When large corporations were in financial hardship, the government had lowered interest rates for them through policy loans and provided them with preferential loans.
Such moral hazard began to dissipate as Korea opened its capital market, pushed for liberalization and adopted global standards in finance and other business areas. Corporations have learned that a high debt ratio lowers their credit rating, makes it difficult to issue bonds and raises the risk of collapsing. They cannot afford runaway investments if they want to have a healthy balance sheet and keep their debt ratios in check.
With fewer loans being sought by corporations and the financial sector restructuring, the portfolios of Korean banks have undergone a structural change. In 2002, banks began to expand lending to households and that put home prices on a multi-year upward trajectory. The administration’s economic policymakers led by Choi Kyung-hwan, deputy prime minister for economic affairs, are attempting to revitalize the real estate market by easing the loan-to-value and debt-to-income regulations and lowering interest rates, and boosting consumer spending though the wealth effect. With the next general elections 18 months away, the political community, the news media, the business community and the financial industry welcome this move as they have much to gain from the strategy.
Almost every chaebol has construction companies, who, along with small builders, are major supporters of local and national politicians. They are also major sources of advertising revenue for the news media. Meanwhile, in the financial industry, profits will increase for banks with mortgages accounting for a large portion of their loan portfolios when home prices go up. A rate cut will provide capital gains for brokerages holding 150 trillion won in bonds. But a property market-centered attempt to boost the nation’s ailing economy will further weaken its foundation and delay structural reform that is badly needed.
Fast growth and development demanded a huge capacity for construction in the previous decades. Now that the demands for infrastructure and housing have been met to a certain extent, much of the capacity for construction is redundant. Despite the pain that it may cause, structural reform must be 29
done now in Korea to avoid following the footsteps of Japan. Until the 1980s, Japan had focused on civil engineering projects and its economy fell sharply when property prices fell in the 1990s.
The current financial system of advanced nations is the result of many crises. The heads of their financial supervisory agencies and central bank have guaranteed terms in office and they take their political neutrality seriously. In addition, employment protection frees bureaucrats from short-term political interests and the pressure of public opinion, allowing them to work for the long-term interest of the nation. Yet, advanced nations still are not immune to crises.
When a financial crisis erupts, taxpayers ultimately have to shoulder the burden of paying all the crisis-related expenses. Those who suffer the most are low-income earners and young people. Then politicians and the news media seek other scapegoats.
Financial supervisory agencies and the central bank are tasked with protecting the national economy and acting as the last line of defense against missteps in the financial sector. Korea’s household savings ratio is 3 percent, the lowest level in the world. Yet, the administration is urging households to take on more debt. It will not be long before the United States phases out quantitative easing and starts to raise interest rates. The financial watchdogs and the central bank cannot afford to allow themselves to be weakened.
[JoongAng Ilbo, September 6, 2014]
www.koreafocus.or.kr
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Is the Korean Won Too Strong?
Sohn Sung-won Smith Professor of Economics California State University CI
A weaker won will be helpful in promoting exports at a time when dark clouds are casting shadows on the Korean economy. It will benefit not just large corporations, such as chaebol, but small- and medium-sized exporters as well. It also will help provide jobs, many of which are created by smalland medium-sized enterprises, contributing to economic growth. In addition, a weaker won will help ward off a slump, as it will encourage investments by foreigners.
Is the won currently valued properly against the U.S. dollar? One of the simplest measures in this regard is the Big Mac index, which The Economist issues each quarter. In the mid-2014 index, the won was 16.5 percent undervalued against the dollar. But the currencies of the main foreign rivals of Korean companies were even more undervalued. The Chinese yuan was undervalued against the U.S. dollar by 43 percent, the Taiwanese dollar by 45 percent and the Japanese yen by 77 percent. On the other hand, the euro and other European currencies were overvalued. The current account balance, which shows a country’s cash flow, is another tool to measure its currency’s value. A current account surplus means the cash inflow is greater than the cash outflow. When the current account balance nears zero, it means the currency is appropriately valued. If the current account surpluses continue, it means that the currency is undervalued. In countries with undervalued currencies, their central banks almost always keep piling up foreign exchange reserves. 31
Korea has had surpluses for a long time, indicating that the won is undervalued. The problem for Korea is that its competitors, such as China, are increasing their foreign exchange reserves more rapidly, which is evidence that their currencies are even more undervalued than the won.
Long-run economic growth and productivity gain constitute a third tool used by economists to analyze the value of a country’s currency. Generally, solid growth over a long period of time and high productivity raise the level of wages. Low productivity and a delay in growth indicate that the currency is weak. The currency of a fast-growing economy continues to appreciate over time. China is a prime example in this regard.
During the past decades, China has sustained a rapid rise in productivity and fast growth and, as a result, the yuan has continued to appreciate. Its foreign exchange reserves are nearing the $4 trillion mark. But for government intervention, the yuan would have strengthened at a faster clip.
Korea shares a similar experience with China. During the past several decades, the Korean economy has grown rapidly. The world has been showing increasing confidence in the Korean economy, with its soundness evidenced by its size and per capita income. The won has strengthened in parallel. On the other hand, the Japanese economy has continued to underperform. Its “lost decade” has turned into a “lost quarter century.” Prime Minister Shinzo Abe’s economic policy, dubbed Abenomics, showed signs of hope at the outset. But the Japanese economy is sputtering again. Regular employment is dropping and wages are falling in real terms. Retail and growth are slipping as well. The listless economy is weakening the yen.
If so, is the won undervalued or overvalued? The Big Mac index, persistent current account surpluses, long-term perspectives about the economic strength and productivity indicate that the won is somewhat undervalued against the U.S. dollar. More critical to Korea, however, is the won’s value against the Chinese yuan and the Japanese yen. There is strong evidence that the won is overvalued against the yen and that the yuan’s value is artificially held down by the Chinese government.
Korea is in direct competition against Japan and China over the sale of many products, ranging from home appliances to cars, in the world markets. Should the Korean government intervene to weaken 32
the won?
The Bank of Japan is conducting another round of massive quantitative easing. Market watchers are expecting the Bank of Japan to push harder to weaken the yen. The People’s Bank of China also is involved in massive quantitative easing, which is generally unnoticed. For the past several years, the Chinese central bank’s balance sheet has been expanding faster than that of the U.S. Federal Reserve. The yuan would be stronger if it were not for China’s quantitative easing and government intervention.
Few expect the Bank of Korea would launch a similar quantitative easing program. After all, the BOK’s benchmark interest rate has ample room to fall. If the central banks of Korea’s competitors continue to weaken their currencies, the BOK will have to ponder how to respond.
[Dong-A Ilbo, September 12, 2014]
www.koreafocus.or.kr
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Imprudent Attempt to Revive Apartment Boom
Lee Won-jae Vice President The Hope Institute
Deregulation in the housing market, championed by Choi Kyung-hwan, deputy prime minister for economic affairs, appears to be awakening the apartment market from its long slumber. With sales activity starting to stir again, news reports say prices will be on the rise in the months ahead. Is the deputy prime minister trying to revive the “myth about apartments?”
The myth is ingrained in the minds of the older generations. In Korean society, the purchase of an apartment has been a goal of anyone desiring to move into the middle class.
Saving to buy an apartment was one of the surest ways to feel successful. To those in the older generations, few things were as reassuring as an apartment purchase. The book “Apartment Games” (written by Park Hae-cheon) explains what it meant.
On April 19, 1960, students rose up against a civilian dictatorship and the president went into exile in Hawaii. But it did not take long before Park Chung-hee took power in a coup. The pro-democracy fighters were flustered by the iron-fisted army general-turned president steadily consolidating his grip on power. Still, this generation benefited from the military-backed dictatorship’s residential development of 34
Yeouido, areas south of the Han River (Gangnam) and other places in Seoul. When the students became mid-level corporate employees, the dictatorial administration launched a project to build 5 million homes, building apartments in Gwacheon, Gaepo, Mok-dong and Sanggye-dong.
Riding on three lows (low oil prices, low interest rates and a low U.S. dollar), the prices of the apartments bought in Gangnam and other new residential districts tripled or quadrupled in a short period of time. The generation born in the 1960s also benefited from apartment construction ― this time in new satellite towns near the capital, such as Bundang, Ilsan and Peongchon. When the Roh Tae-woo administration (1988-93) launched a project to build 2 million homes, they were given preferential terms to buy apartments, which continued to rise in value. As a result, many apartment owners joined the middle class. As such, it may not be too much to call older Koreans the “apartment-enriched� generations. For them, apartments became a source of financial security later in life. Those with stable jobs could open special bank accounts, borrow money at preferential low interest rates and subscribe to new apartments at below-market prices. They could sell them after a certain period of time and save all or part of their profit for old age.
Many of them also honed financial skills through apartments. When they had seed money large enough to buy one apartment, they could borrow money, buy several apartments (whose prices were nearly certain to rise), rent them and receive substantial lump-sum key money from tenants. In a word, apartments provided them with capitalistic leverage.
At the time, apartments provided a good example of trickle-down effects in the economy. Apartments did not produce anything. Yet, they appreciated in value over time. The gains trickled down from high rates of growth generated by booming exports.
It was not only apartment purchasers that benefited from the apartment construction boom. The news media desperate for ad revenues and the administration with few welfare policies also gained much from the buildup.
But conditions changed for those who attended universities in the 1990s. The era in which most university graduates could own an apartment soon after they were employed or married ended with them. 35
They were not as fortunate as the previous generations; only a handful of this generation who inherited wealth from their parents, or had no qualms about borrowing money, bought their own apartments. The great majority were deprived of opportunities to buy apartments on preferential terms.
The situation has become even bleaker for those who were in their 20s in the 2000s. There are few institutional incentives for those who are buying their homes for the first time. In addition, apartment prices have already risen so high that it is not likely that they will go up any further. They may sustain huge losses in the future if they borrow money and answer the government’s push to buy apartments.
The administration reminds people that apartment ownership has been a way to gain wealth, an apparent attempt to instill in society the older generation’s sentiment toward apartment purchases. Apartment ownership’s connection to building wealth and yielding retirement money was established long ago. But it no longer serves those functions in Korea, where the population is graying fast and faced with the risk of shrinking.
It would be horrendous for those owning no apartment if the team of economic policymakers led by Deputy Prime Minister Choi should attempt to turn the nostalgia into a reality. Nostalgia is appealing when it remains nostalgia. Young and future generations cannot find any hope in apartment ownership. A policy of reviving an apartment boom would probably do much harm to their future.
[The Hankyoreh, September 10, 2014]
www.koreafocus.or.kr
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- Launch a Public Forum on Welfare Taxation - Ways to Shed No. 1 Title in ‘Population Extinction’ - Aggressive Society and the Internet - Living as an Emotional Labor Provider
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Launch a Public Forum on Welfare Taxation
Oh Keon-ho Co-General Secretary My Welfare State
The Park Geun-hye administration has finally shifted its direction to back tax hikes. It is as if the administration has opened a sluice gate. Of course, it should first put out a fire ― a financial shortage caused by the expansion of welfare programs.
During her presidential election campaign, Park said her stewardship would avert the need for higher taxes. But she has initiated debate on increases herself. She must feel uncomfortable about backpedaling but this is an inevitable turn of events. If she had realized that welfare expansion would be unavoidable she would have accepted tax hikes as a natural consequence.
For those who advocate universal welfare benefits, tax hikes are an urgent matter. More tax revenue is required to support the growth of welfare over recent years. But the nation’s tax system remains unchanged, leading to imbalances in allocations. Considerable portions of the budget are spent on free childcare and basic pension payouts, while welfare for vulnerable people, such as the basic livelihood security and public housing, is neglected. With a tight budget, the Park administration cannot even think about the contours of universal welfare.
The latest debate on tax hikes has been sparked by local municipalities. Welfare directives from the
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central government are forcing local municipalities to spend more on welfare. Their outcries on defaulting on basic pension payments are not an exaggeration. Since last year, the municipalities have strongly demanded more budget support from the central government because they have no authority to increase taxes unilaterally. The central government’s fiscal health is fragile, too. The fiscal deficit will likely exceed 30 trillion won (approximately US$30 billion) this year and a turnaround in 2015 is unlikely. In its mediumrange fiscal plan submitted to the National Assembly last year, the Park administration bragged that the fiscal deficit will take up a mere 1.1 percent of the GDP in 2015 and will be close to zero in 2016, the last year of Park’s five-year tenure. But a budget plan agreed on by the administration and the ruling party some time ago shows that the size of the fiscal deficit will again exceed 30 trillion won, or about 2 percent of the GDP, next year.
With tax increases unavoidable, attention now should be on how they are implemented.
First of all, the Park administration proposed tax hikes in an inappropriate way. Success of taxation depends on trust. But the administration unilaterally announced a tax hike plan lacking clarity. It is neither willing to communicate with the people, nor frank with them.
Considerable distrust exists between the administration and the parliament so it would be better to decide tax hikes through public forums and have the government accept the results. To be sure, one of President Park’s election campaign promises was launching a "people’s committee for grand compromise," which would discuss national issues like the public's tax burdens. Let's make all tax raising measures open to public debate. The president’s tax package includes higher residence and auto levies. They would severely affect working-class citizens. It is indeed surprising to see the government raise "poll taxes" while the nation is weak in direct tax collection. Opposition circles and civic groups have called for tax hikes on the rich by increasing income tax rates and raising the ceiling on corporate taxes.
I support the introduction of a tax for welfare programs. The special-purpose tax would be effective in assuaging the public’s distrust in the expenditure of taxpayer money. A few welfare organizations have already filed a petition calling for a social welfare tax with the National Assembly. In Japan, an increase in the value-added tax was equivalent to a special-purpose tax raise since an increased portion is earmarked for welfare programs. 39
When a tax debate is initiated, the Ministry of Strategy and Finance will surely suggest raising the value-added tax. In that case, I hope that the ministry will propose a special-purpose tax for welfare, as in Japan, so that there will be a productive public debate on both a “social welfare tax,� which could be a surcharge on income, corporate and property taxes, and the government-suggested "consumption welfare tax," a surcharge on the value-added tax.
In Korea, the discourse on welfare is changing from "universal welfare" to "tax increases to pay for boost in welfare programs." The government still remains reluctant to use the term "tax hikes." The size of tax hikes under discussion is not sufficient enough to meet the demand for welfare, even if the government's revision bills on national and local taxes are passed by the National Assembly.
We need active debate on tax hikes even more, in view of the permanently structural fiscal deficit, in which the central government has collected a whopping 12 trillion won less in tax revenue this year than was expected. Trust the people. Launch a public forum on tax hikes for welfare programs and let the taxpayers participate in the debate.
[Kyunghyang Shinmun, September 17, 2014]
www.koreafocus.or.kr
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Ways to Shed No. 1 Title in ‘Population Extinction’
Jung Ku-hyun Visiting Professor, College of Business Korea Advanced Institute of Science and Technology
Korea is said to be the most likely country that will face population extinction. A computer simulation by the National Assembly Research Service revealed that Koreans will disappear several hundred years from now if the nation’s low birth rate does not improve. Far earlier, Korea will have serious problems in coping with a rapidly aging population. By some estimation, the percentage of those older than 65 out of the nation’s total population is expected to increase from 14 percent in 2017 to 20 percent in 2026. The aging speed is unprecedented.
Population aging is a matter of great concern because it leads to a host of problems, including labor shortages, social conservatism, bigger fiscal deficits and weakened economic performance. In only 12 years, Korea will fit the U.N. definition of “super-aged nation” with more than 20 percent of the population aged 65 or older. Yet, the nation remains too carefree. Even if we begin right now to make multilateral efforts to turn the tide, time will not be on our side.
Last year, the government implemented a set of aggressive policy measures to support childcare, including a 200,000 won (US$$200) or so stipend for monthly childcare. But the measures will not likely change the mind of young women who have career aspirations. Moreover, educational costs for children are so high that middle-income families can hardly raise even one child.
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The working-age population (aged between 15 and 64) is expected to begin prolonged shrinkage in 2017. Since a near-term baby boom cannot be expected, the most practical way to cope with the decrease is to make better use of the labor force we currently have. We need to pursue the following three measures more actively. One is to increase women’s participation in economic activity and another is to lower the age of young people’s first job by cutting back on military service and reducing the time spent for college entrance preparation. The third is to increase the official retirement age. The policy to extend the official retirement age to 65 should be put into force as soon as possible.
Some people think it is too premature to discuss extending the official age of retirement because it was just recently reset to 60, which is scheduled to go into effect in 2016. But there isn’t much time. The average life expectancy of Koreans (80 for men, 85 for women) is already on the level of advanced countries. The official retirement age in most developed countries is 65, and it is 67 in Germany and Denmark.
As a matter of fact, many Korean elderly people keep working past the age of 70. Since the allowances they get from the national pension scheme are too small to cover their actual living expenses, most senior citizens have no other choice but to continue working. Poverty among the elderly remains a serious social problem.
Needless to say, to increase the retirement age to 65, the wage system and the labor market will need to be adjusted. We should create various systems to help the aged work for relatively low salaries after the age of 60. Some examples include job training programs and the introduction of merit-based pay and salary peak systems. The latter allows a senior employee to continue working in exchange for a yearly reduction from his peak salary.
The administration and the legislature should draft a bill that would extend the retirement age to 65, which will consequently defer the age of receiving one’s first pension payment to 65, and have the new retirement age go into effect in 2025 at the latest. At the same time, social and political systems, society’s perception of age and related institutions would need to change. Only those who are over 70 years old should be referred to as the elderly. Only then can the nation be prepared for an era of aging population.
Another urgent issue to discuss is immigration. Currently, 1.55 million foreign residents are registered 42
in Korea, comprising about 3 percent of the population. Less than 40 percent of them are employed. European countries with high rates of population aging have overcome serious labor shortages by accepting immigrants actively. Immigrants take up more than 10 percent of the population in most developed countries. They account for 16 percent in Sweden and as much as 43 percent in Singapore.
Only Japan has an exceptionally low percentage of foreign residents, which hovers at 1.6 percent (as of 2011). Japan has so far adopted a policy to control immigration, but is showing signs of change. While reiterating its position to keep the population at 100 million, the Abe administration has announced its plan “to open doors wide to foreign workers.� Within 15 years, Korea also will be compelled to open its doors wider to foreigners.
We should immediately start reviewing our immigration policy and discuss whom to accept and how. We need selective policies that will accept foreign students, overseas Koreans, immigrant investors and science technicians. The integration of South and North Korea also needs to be approached from the perspective of population policy. An immigration policy can shake the foundation of Korean society. However, for Korea to survive, we have to take a more positive view of immigration.
[Dong-A Ilbo, September 11, 2014]
www.koreafocus.or.kr
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Aggressive Society and the Internet
Hwang Yong-suk Professor, Department of Media and Communication Konkuk University
Korean society is simmering with aggressive debates. This is not simply a matter of ideological conflicts or political differences, which have long acted as kindling for confrontation in the country. Even trivial everyday issues trigger the vicious cycle of scorn, frustration, anger, attack and retaliation. The hyper-emotional state goes on ceaselessly.
This phenomenon is easily seen on the websites of newspapers. Perusing the online comments on events big and small, ranging from antagonistic remarks toward the bereaved families of the victims of the Sewol tragedy to actress Kim Bu-sun’s violence in a squabble with a neighbor over heating bills, I can see that our society is more accustomed to criticizing and demeaning each other rather than seeking understanding.
Extremely belligerent expressions, which sound even outrageous, give a sense of frustration to those who read them. English psychiatrist Anthony Storr used the expression “uncivilized impulse” to suggest that humans have innate aggressiveness, but many other researchers have tried to find an explanation elsewhere. For example, the “frustration-aggression hypothesis” says that aggression is the result of blocking, or frustrating, a person’s efforts to attain a goal. The fury widespread in cyberspace today can be an expression of political, economic and social frustration in our society.
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When confronted with a frustrating situation, people tend to resolve it through verbal assaults, which have the lowest barrier. Cyberspace, where anonymous communication is possible, is the most suitable place for this behavior. Regarding acts of online verbal violence, most people justify themselves with various excuses. According to the theory of cognitive dissonance, we don’t want our egos (the images we have of ourselves) to conflict with our actions. So, we try to remove the mental stress resulting from the dissonance between our beliefs or ideas and our actions by reconciling them. What is already done can’t be undone, but it is relatively easy to change the attitude toward what is done to justify it. Thus, most people get psychological stability by simply changing their attitude or perception of their actions, the theory says.
People believe they are reasonable, so they rationalize their verbal violence as justifiable action and try to eliminate the dissonance. Retaliatory verbal attacks, in response to insults, can also be seen as “justifiable self-expressions.” Verbal aggression made online also arouses the same level of oral retaliation.
According to the results of a psychological experiment, people who are exposed to aggressive acts like an insult opt to retaliate in kind. One verbal attack leads to another verbal attack and the process repeats itself continuously. More concerning is the fact that online communication is much easier to bring out socially unacceptable behavior because it can be done anonymously.
What really worries me is that political cynicism will spread widely in our society through the Internet, where excessive acts of aggression breed equally violent responses, and as a result it will undermine the public’s sense of efficacy about political and social participation. Needless to say, social trust also will collapse.
The mass media is also responsible for this phenomenon. Media organizations are supposed to deliver news calmly and objectively, but in many cases, they misbehave first. They should refrain from making biased and emotionally charged reports, which can instigate cynicism and anger. It is necessary for each media outlet to draw up measures to manage online comments to befit its identity. The Huffington Post in the United States is famous for its strict control of online comments, which can be seen as overly stringent, but nobody believes that such a policy has violated the right to know or the freedom of speech. People simply accept it as their media policy.
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[The Hankyoreh, September 19, 2014]
www.koreafocus.or.kr
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Living as an Emotional Labor Provider
Kim Sang-su Assistant City Editor The Dong-A Ilbo
“Fasten Your Seatbelt” (“Rollercoaster” in Korean), a low-budget film that marked the directing debut of award-winning actor Ha Jung-woo, is about a plane with obnoxious passengers who constantly pester the flight crew. The cast of characters includes a philandering hallyu movie star who repeatedly asks for the business card of a stewardess he’s interested in and a business-class passenger who demands an in-flight meal even before the flight takes off. Behind the curtain the stressed out flight attendants ridicule these annoying passengers.
Unfortunately, the 2013 movie is not far removed from reality. According to a survey by the Korea Research Institute for Vocational Education and Training, flight crew members topped the list of 10 jobs that require the most “emotional labor.” That term first appeared in the 1983 book “The Managed Heart” by Arlie Russell Hochschild, a sociology professor at the University of California, Berkeley. Any service employee who typically spends more than 40 percent of his or her work time managing emotions is considered an emotional labor provider.
Besides flight attendants, they include department store sales clerks, call center workers and golf caddies. Their jobs require unflagging self-control of their feelings in order to offer clients kinder and 47
more pleasant service. Typically, many service providers have “smile-mask syndrome,” smiling but suffering inside.
The stress levels of flight attendants and golf caddies are much higher than those of other emotional labor providers. In particular, female workers are at higher risk of being exposed to saucy jokes and sexual harassment by their male clients.
At one local department store, salespersons are expected to adhere to a service manual that requires greeting every customer politely while making eye contact. And instead of the “Three Don’ts” ― “We don’t have”; “I can’t do”; “I don’t know” ― salespersons are instructed to say, “We are very sorry, it was already sold out”; “We’re very sorry for being unable to help you”; and “Please, wait for a moment. I will check it for you.”
The Korea Occupational Safety and Health Agency estimates the number of workers involved in emotional labor at 5.6 million to 7.4 million among a total of 17.7 million employees in Korea, equivalent to three out of 10 workers. Half of them are women.
According to a survey of 2,268 emotional labor providers regarding their health conditions, conducted by the Korea Federation of Private Service Workers’ Union and the Institute for Occupational and Environmental Health in 2013, 48.9 percent of female respondents reported that they have experienced depression. Among the workers surveyed, 30.6 percent said they have had suicidal impulses and 4 percent have attempted suicide.
When asked why they did not tell their employer about verbal or behavioral harassment from customers, 82.6 percent of the respondents said that their company would not do anything to address the matter. The main cause of the suffering that emotional labor providers have to face actually lies in their companies’ attitude of not caring about the well-being of their employees while forcing them to show unconditional kindness even to rude consumers.
Now, all this brings a question to mind. Even if you were to find emotional labor providers struggling under such miserable working conditions, would you still believe that the consumer is king and should be treated accordingly? We need to put ourselves in others’ shoes before we say or do something.
The time is now for Koreans to create a socio-cultural environment where consideration and respect for others is displayed at all times. In this sense, I would like to applaud the female caddy who accused 48
former National Assembly Speaker Park Hee-tae for sexual harassment, thus drawing public attention to the issue of emotional labor.
[September 19, 2014]
www.koreafocus.or.kr
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- Validation Delayed for the Oldest Movable Metal Type - CCTV, Dilemma between Privacy Protection and Public Interest - Priorities in Tourism Policy - Truth about the Young Patriotic Martyr Yu Gwan-sun
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Validation Delayed for the Oldest Movable Metal Type
Editorial The Kyunghyang Shinmun
Yesterday was the Day of Printing. It was created 26 years ago to celebrate September 14, 1447, the day when Seokbo sangjeol (Episodes from the Life of the Buddha), one of the earliest books written in the newly promulgated Korean script, was printed with movable metal type. In recognition of leading contributors to the printing industry, the government awarded the Order of Cultural Merit, which exceeded the Cultural Medal in prestige, as well as the Presidential Commendation, Prime Minister’s Commendation and Cultural Minister’s Commendation.
This is to be expected from a country that has a rich history of printing culture. It is the home of Jikji [shortened title of Jikji simche yojeol, or “Anthology of Great Buddhist Priests’ Zen Teachings”], printed with the world’s oldest movable metal type, and Mugujeonggwang dae daranigyeong [Great Dharani Sutra of Immaculate and Pure Light], the oldest extant woodblock print. What is regrettable is the government’s slack effort in discovering and preserving the excellent printing heritage created by our ancestors. Cultural Heritage Administration’s negligence of so-called “Jeungdoga Type” is a case in point. In 2010, a private art gallery revealed this movable metal type of the Goryeo Dynasty. It is believed to be 138 years older than the type used for printing Jikji. At the time, a bibliographer claimed that it was the type used to print the 13th-century Goryeo edition of Nanmingquan hechang song zheng-
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daoge, (Nammyeongcheon hwasang song jeungdoga in Korean), known as the “Song of Enlightenment.” After it was disclosed, scientific and bibliographic validations, including radiocarbon dating, were conducted by Korean and foreign research institutions, and research results were announced through symposia and dissertations inside and outside of the country.
The owner has applied for designation of the 101 letters of the type as a cultural property at the Cultural Heritage Administration. But the government agency has taken no follow-up steps for the past three years, saying the type may be a fake. Thus far, no academic backing for the explanation has come forth. The owner alleges that the official whose work is related to Jikji is intentionally sabotaging the application, fearing that the value of Jikji might decline. Judging the authenticity of a cultural relic is also the agency’s job. It belatedly began the validation process after the owner’s incessant complaints. No one knows when the process will end. If a valuable cultural heritage item is not registered and preserved as a cultural asset, the risk of damage arises. Since the type is not a registered cultural asset, the owner may decide to sell it overseas. In fact, the German ambassador to Korea has expressed interest in purchasing the type. If the type is officially recognized as the world’s oldest movable metal type, it would be a momentous event in the history of civilization and we may need to rewrite the history of printing technology. And the type would become part of the world cultural heritage. This is the reason why the government should have more interest in designating the type as a cultural treasure.
[September 15, 2014]
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CCTV, Dilemma between Privacy Protection and Public Interest
Kang Tae-uk Partner Bae, Kim & Lee
The main principle of protecting customer privacy is keeping personal information confidential. However, this principle is based on information being collected and processed on a one-to-one basis. Thus, it’s hard to apply when the personal information of many individuals are recorded and collected unwittingly by closed-circuit television (CCTV).
It is of course impractical to install CCTV on the street and then seek agreements in advance from everybody who might end up on CCTV tapes. Hence the Personal Information Protection Act allows customer privacy agreements to be replaced by a notice of CCTV operating in public places. Since the regulation on personal information protection related to CCTV was enacted, there hasn’t been much progress in discussions on additional regulations. The main reason must be the very different perspectives between proponents of privacy protection and public interest.
Privacy protection advocates say individuals should be able to decide whether they want to be recorded by CCTV or at least be allowed to delete CCTV recordings of themselves at any time. People who have this point of view believe it is simply unthinkable that others will easily know your movements on a specific day, what public transportation you used, or what you had for lunch, without your knowledge. For these people the fact that CCTV recordings are used to investigate crimes does not justify their existence. 53
Those who focus on the public benefit of CCTV believe that it is reasonable to expand CCTV coverage and integrate related information for efficient use because it can greatly benefit the public.
Currently, there is no information sharing by local governments and the police. The Personal Information Protection Act clearly separates information collection and information transfer without special regulations regarding CCTV. This legal ambiguity is also connected with the inherent limits of the law, which applies the same standards to both private and public sectors.
The issue of integrated control by local governments and the police should be dealt with in the same way as two private companies that share control of personal information they have collected separately. Considering the social resistance against such information sharing by the private sector, the issue is not a matter to be brushed off in the public sector.
The efficiency from the integrated control must be bigger than the possibility of privacy infringement through the integrated control. Other than the vague assumption that the integrated control would be efficient, however, it is difficult to predict how effective integrated control would be in preventing crimes and resolving social disputes. It is also difficult to conclude that synergy from the integration of information managed by administrative and investigative authorities would be clear enough to ignore the legal ambiguity surrounding the matter.
As the public gets more interested in personal information protection, the scope of protection will be expanded. A satisfactory settlement of conflicting issues is a difficult challenge, but not impossible. It is necessary to continue to provide forums for discussions.
[Seoul Shinmun, September 2, 2014]
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Priorities in Tourism Policy
Son Won-cheon Staff Reporter The Seoul Shinmun
The sixth “trade and investment promotion meeting,� held at the Blue House on August 12, has suggested a few issues for tourism industry insiders to ponder. The first issue is increasing the use of environment-friendly cable cars and the second is the construction of a resort complex. But I cannot help feeling that an issue that has to be addressed immediately has been stalled while an issue that needs a long-term approach has been decided hastily.
With respect to cable cars, it has been decided to install some in Mt. Seorak in Yangyang, Gangwon Province and Mt. Nam in Seoul. However, installation on Mt. Jiri, which has been debated for years, was rejected again. The rejection was due mainly to a brawl among the local governments of Sancheong and Hamyang of South Gyeongsang Province, Namwon of North Jeolla Province and Gurye of South Jeolla Province. All of them have attempted to install cable cars and faced objections from environmental groups.
It does not seem appropriate to consider the issue only from an environmental perspective. Advantages and disadvantages in regard to public welfare should be weighed, too. How many of the numerous mountains in the national parks across the country are accessible to senior citizens and those with disabilities? Only a handful of mountains, such as Mt. Seorak, fall into this category.
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In contrast, there are about 2,500 cable cars in the Alps in Europe, and about 40 cable cars are operating at 29 national parks in Japan. It is not difficult to find countries which have installed cable railways such as funiculars at the foot of a mountain offering spectacular views. This is why we need to have a more favorable view of cable cars.
Some claim that the ultimate purpose of building cable cars is to reinvigorate the provincial economy and that benefitting those who need help going up mountains is a superficial reason. I fully agree with them. Nonetheless, I still believe the rights of the underserved population in tourism to appreciate autumn foliage and snowy landscapes in national parks without any barriers should not be taken lightly. Installing cable cars also is expected to help attract foreign tourists to local areas. Therefore, we should find ways to minimize environmental damages and to expand tourism benefits as promptly as possible.
On the other hand, I think it was premature to announce a plan to go ahead with the construction of a resort complex in Jeju Island. Jeju is already saturated. The complex will be built on the mid-slopes of Mt. Halla, which are prized as the island’s last remaining channels of fresh air. A resort complex has obvious advantages. But they are largely functional matters that can be resolved by making use of luxury hotels, resorts and convention centers in Jungmun and other tourist areas.
What I am saying is all this is not a matter to be hastily handled under the logic of capitalism. It also runs counter to Governor Won Hee-ryong’s repeated pledges to stop reckless development projects on the island, including construction of resort complexes. Let’s be frank. Why does the island need another resort complex? This newspaper made a thorough analysis of the issue over three pages on August 23. The keyword of the project is “casino.” That’s the point, regardless of the rhetoric. The proposed casino would initially cater to foreigners only, but will eventually press for access to locals. Then, it will lead to all sorts of social problems beyond the territory of the tourism industry. We need a national consensus before allowing the construction of a large-scale resort complex that has a casino.
[September 2, 2014]
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Truth about the Young Patriotic Martyr Yu Gwan-sun
Hong Chan-sik Editorial Writer The Dong-A Ilbo
I received a letter from a reader several months ago. The letter concerned Yu Gwan-sun (1902-1920), a famous female independence activist. The reader stressed that the recent allegation that Yu was intentionally made into a heroic martyr by some people who wanted to cover up their pro-Japanese activities during the colonial period is absolutely nonsense. He presented the testimony of Park Chang-hae, former Yonsei University professor, as evidence to support his claim.
After national liberation in 1945, Park produced elementary school Korean language textbooks for three years. The nation’s first Korean language textbooks for elementary school pupils, in which the child characters Cheol-su and Yeong-hui and the spotted dog called Badugi appear, were created by Park. Indeed, he was the creator of the boy and girl who are familiar to all Koreans. He passed away in 2010, but left behind a retrospective essay titled “My Days as a Korean Language Textbook Editor,” which was published in an academic journal in 2006.
In the essay, Park depicted how Yu Gwan-sun became widely known as an independence activist. One day, while discussing the content to be contained in school textbooks, the participants agreed to look for a female national hero like Joan of Arc of France from among the women who participated in the March 1 Independence Movement of 1919. Novelist Jeon Yeong-taek, who was also in the group, visited Ewha Girls’ High School to meet its principal, Shin Bong-jo, to discuss the matter as 57
he knew that students of Ewha Haktang, predecessor of Ewha Girls’ High School and Ewha Womans University, played active roles in the movement. Shin recommended that he meet the school’s deputy principal, Seo Myeong-hak, who had prepared national flags and the declaration of independence for the movement. However, Seo was reluctant to single out any one student, saying that more than 200 students of Ewha Haktang participated in the struggle.
A few days after Park informed other textbook editors of this, Yu Je-han, who was working at the same office with Park, visited him. Yu said that in his family there was an Ewha Haktang student who was imprisoned for participating in the March 1 Independence Movement. The student was the man’s aunt, Yu Gwan-sun. That was how Jeon wrote a story about Yu Gwan-sun, which was included in school textbooks. According to this account, the three men ― Park Chang-hae, Jeon Yeong-taek and Yu Je-han ― had key roles in making Yu Gwan-sun an iconic freedom fighter. It is assumed that this happened in 1946. The testimony is quite convincing because Jeon published the first biography of Yu, entitled “Yu Gwan-sun: A Young Patriotic Female Martyr,” in 1948. But it has intensified allegations that Yu Gwan-sun was made into a hero by pro-Japanese collaborators.
Those who question the process of immortalizing Yu argue that it was done by Park In-deok, a graduate of Ewha Haktang, and Shin Bong-jo to cover up their pro-Japanese activities.
Currently, four of the eight high school history textbooks do not include any description of Yu Gwansun. “It is because there is a research finding that Park In-deok, who has a record of pro-Japanese activities, discovered Yu Gwan-sun and made her into a national hero,” says Kim Jeong-in, a professor at Chuncheon National University of Education.
I found that the research paper Professor Kim cited was based on weak evidence. It mainly consisted of a conversation between Park In-deok and Shin Bong-jo, broadcast by Voice of America in 1978. In their exchange, Park said she had thought that once the nation was liberated from Japanese rule, Yu Gwan-sun should be made known widely as a Korean female patriot. Shin responded, “What you [Park In-deok] said enthusiastically [about Yu Gwan-sun] became known among the Korean people.” That was nearly all.
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Above all else, Yu’s brave struggle for the nation’s independence touched the people’s hearts. Renowned leaders of independence movement, including Kim Gu and Lee Si-yeong, participated in establishing a memorial society for Yu. The controversy has reaffirmed some historians’ antagonism against the right-wingers. To them [so-called progressive historians] the right-wingers are often synonymous to “pro-Japanese forces.”
While few people doubt Yu Gwan-sun is a great figure, she was left out from some textbooks simply because she was made famous by pro-Japanese collaborators and right-wingers. Actually, most historians joined forces to lash out at a textbook published by Kyohak Publishing Co. for focusing on the historical views of the conservatives. As a result, not a single school adopted the textbook. In contrast, there has been no debate about biases in historical descriptions and inaccuracies of other textbooks.
The government is now considering shifting the current authorization system into state compilation of history textbooks. Even after the shift, a considerable portion of textbooks will be written by historians. Regardless of system, well-guided history education will remain a far-fetched dream unless the biased viewpoints of the academic community are straightened out.
[September 4, 2014]
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- Analysis of Business Operations at Kaesong Industrial Complex - Class Self-Identity and Life Satisfaction
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Analysis of Business Operations at Kaesong Industrial Complex Suh Dae-hoon Researcher Korea Development Bank
I. Operational Situation 1. History
Construction of the Kaesong (Gaeseong as spelled in South Korea) Industrial Complex started in June 2003 and the first stage was completed in October 2007, covering 3.3 square kilometers, or 1 million pyeong, near the North Korean city of Kaesong, some 10 kilometers north of the Demilitarized Zone. If the third stage is completed as planned, the complex’s industrial zone will expand to 19.9 square kilometers and its supporting area will occupy 9.9 square kilometers. By the end of 2012, South Korean private enterprises, the South Korea government, Korea Land and Housing Corp. and the Kaesong Industrial Complex Management Committee had invested a total of 1,688 billion won (approximately US$1.5 billion) in the complex.
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2. Present Situation
The total output from the industrial park from December 2004 through the end of 2013 amounted to $2.2 billion. Production slowed down in 2009 because of the North’s restrictions on vehicles arriving and leaving the complex (from December 2008 to August 2009). Production again shrank in 2013 due to the North’s unilateral closure of the complex from March to September in 2013.
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At of the end of 2013, the complex housed 123 South Korean companies, 72 of them in textiles. The rest included machinery and metal (23); electrical and electronic (13); chemicals (9); paper and timber (3); food (2); and non-metal mineral (1).
These companies enjoy tax benefits, including an average corporate income tax rate at 14 percent. In their first two to five years of earning profits, South Korean companies based in the complex are exempted from corporate income tax. The next one to three years, they get a 50 percent reduction on their corporate income tax rate.
The parent companies in South Korea receive 4 to 7 percent tax reductions in reward for job creation and investment, and for small and medium-sized enterprises the tax cut amounts to 15 to 30 percent. Products from the complex that are brought into South Korea are not subject to tariffs because they are classified as tax-exempt inter-Korean trade goods. The two Koreas have also concluded an agreement to prevent double taxation.
The complex employs some 53,000 people, including 52,000 North Korean workers. The number of North Korean workers steadily rose in the early years but has barely increased since 2012, due to shortages of available labor from the nearby areas.
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With the basic monthly salary for workers set at about $70.53, companies operating at the complex have significant wage competitiveness over their peers in Asia. Annual wage increases are limited to 5 percent, ensuring stable labor costs.
The South Korean government continues to provide support to make the Kaesong Industrial Complex
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a globally recognized industrial facility. An investment promotion office is being planned to help attract more foreign investment. The planned office will offer investment consulting services and operational guidance for new investors.
II. Analysis of Business Operations 1. Methodology
This analysis attempts to determine how investment in the Kaesong Industrial Complex affects the overall business operations of companies that depend heavily on output from the facility. To form a representative pool from the 123 enterprises that have factories in the complex, the following parameters were used:
- Companies that are subject to external audits and transparent about preferential terms received on transactions through the complex; - Companies with a dependence rate (average purchase-related costs from the complex/average sales costs of parent company) of over 9 percent on the complex; and - Companies that have disclosed financial figures in at least three out of the four years analyzed (20092012; data for 2013 is excluded due to abnormal operations following the North’s closure of the complex).
Twenty companies were selected.
Analysis has been made on the basis of the companies’ disclosures on operational factors at the complex, particularly their business performance since launching activity in Kaesong.
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For this analysis, the average financial metrics of the 20 selected companies from 2009 through 2012 were compared with the average figures of domestic companies in the same industries. Since several companies are in the same business, weighted average figures were used to obtain meaningful results.
Financial metrics of 2013 were not taken into account because they were yet to be compiled and because North Korea’s temporary closure of the complex during the year skewed performance.
2. Analysis of Growth
The average sales growth rate of companies at the Kaesong Industrial Complex notably exceeded the overall average rate of domestic companies during the first two years, but rapidly fell thereafter to trail behind their domestic counterparts.
The total asset growth rate of companies operating factories at the Kaesong Industrial Complex declined during the four years in contrast to the overall rise of their counterparts inside South Korea. Among the textile manufacturers, the growth rates of resident companies at Kaesong were generally comparable to those of their counterparts in South Korea. 66
3. Analysis of Profitability
Rates of sales cost were slightly higher among the firms operating factories at the Kaesong Industrial Complex than those not in Kaesong. Textile companies in Kaesong posted higher sales cost rates than their peers in South Korea while other firms at Kaesong showed lower rates than their domestic counterparts.
The operating profit rates of firms at Kaesong were lower than the overall average of their respective domestic counterparts during 2009-2012. Textile firms recorded particularly low rates to bring down the average of all businesses at Kaesong. Among textile firms, especially bad performance of a single 67
company adversely affected the overall figure in the textile area.
4. Analysis of Stability and Activity
During 2009-2012, the debt ratio of textile firms at the Kaesong Industrial Complex fell sharply but remained higher than the average level of their domestic counterparts. In other business lines, no such change was seen in debt ratios.
The capital turnover ratio of firms at Kaesong remained lower than the average ratio of their domestic counterparts during 2009-2012. In the case of textile firms at the complex, their capital turnover ratio was lower in comparison to all firms operating at the complex because they had lower sales growth 68
and higher asset expansion.
5. General Assessment
Except for their debt ratios, the financial metrics of the firms at the Kaesong Industrial Complex were generally on the same level as their counterparts at home during 2009-2012. South Korea’s sanctions on the North, imposed on May 24, 2010 in retaliation on the sinking of its Navy corvette Cheonan, banned additional investment by South Korean enterprises in the complex, adversely influencing business performances of firms operating at the complex. Sales growth rate was considerably lowered while total asset growth continued to decline. In 2012, a textile firm took over a Chinese company to help register a high asset increase.
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Overall, companies operating at the complex had higher sales cost rates than their domestic counterparts despite the lower wage scale in Kaesong. It seems to be the result of low added value of their products which have yet to gain market recognition.
Textile firms operating at the complex showed operational results comparable to their domestic peers. Management stability grew with their debt ratios steadily falling. Profit surpluses increased allowing repayment of long- and short-term loans.
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III. Findings and Future Tasks 1. Findings
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South Korean firms operating at the Kaesong Industrial Complex have enjoyed advantages in wage scale and tax benefits but their overall business performance has not been particularly better than their domestic counterparts. This may be related to limited management capability and technical knowhow. Also, South Korea’s 2010 sanctions on North Korea have curbed facility expansion at the complex.
The companies at the joint industrial complex have been barred from enlarging facilities to produce new products and using equipment and materials classified as strategic goods. The latter has restricted entry of specific firms and installation of manufacturing processes utilizing such goods. This has forced firms at the complex to replace equipment and facilities with low-quality machinery and revise manufacturing processes.
Yet, some companies have been able to improve their business performance by moving their operations to the cross-border industrial park. Consulting services to disseminate the examples of successful firms are needed. It could help advise companies that are making a U-turn from overseas operations and are seeking a location on the Korean peninsula.
2. Future Tasks • Manpower supply: Construction of dormitories and residential blocks near the complex is necessary to address the labor shortage. When other hurdles have been removed, additional labor supply will be essential for the expansion of the complex through entry of newcomers and existing firms. • Attracting foreign enterprises: In order to promote foreign investment, support plans are needed, such as investment guidance and readjustment of sale prices of commercial properties. Entry of foreign businesses could act as a strong deterrent against unilateral closure of the industrial park by North Korea for political or other reasons. • Easing restrictions on strategic goods: A revision to the current management system of strategic goods is needed to support firms introducing appropriate equipment and facilities. The complex should thus seek to overcome limitations of simple toll processing. • Designation as an offshore processing area: Korea should hold negotiations with partners of free trade agreements to designate the Kaesong Industrial Complex an offshore processing area. When products from the complex are recognized as Korean-made and are applied preferential tariffs, their international competitiveness will be enhanced. 72
[ KDB Monthly Bulletin, September 2014, Korea Development Bank ]
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Class Self-Identity and Life Satisfaction Oh Jun-beom Researcher Hyundai Research Institute
Lee Jun-hyup Research Fellow Hyundai Research Institute
I. Overview Previous research on factors that affect life satisfaction has largely omitted the relationship between class consciousness and life satisfaction. According to the Organization for Economic Cooperation and Development (2013a, 2013b), life satisfaction is an effective gauge to evaluate a person’s life and its quality.
Life satisfaction is affected by many factors that touch on demographics (age, sex, etc.), material (income, asset, etc.), quality of life (employment, health, education, etc.) and emotions (character, etc.). Also, self-perception about one’s social and economic class significantly impacts life satisfaction.
People in the middle-income class or higher perceive themselves as the principal members of society. Their class consciousness allows them to resist social and economic alienation as well as any sense of relative deprivation, creating satisfaction with their lives that is far higher than those in the lowincome bracket. According to a survey by Statistics Korea in 2013, life satisfaction of people who felt they belonged to the high-income, middle-income and low-income brackets was 77.9 percent, 44.8 percent and 17.0 percent, respectively. Similarly, in a Hyundai Research Institute survey, life satisfaction of the “self-perceived middle-income class” was 82.3 percent, compared to 55.5 percent among those who felt they were in the lowincome class.
This study attempts to analyze the effects that various factors have on life satisfaction and derive policy implications from them. In compiling factors that influence life satisfaction, this study added class consciousness to the major variables suggested by previous research, including those by OECD. 74
• Class consciousness: self-perceived middle-income class, self-perceived low-income class • Demographic factors: age, sex • Material factors: income, net worth • Quality of life factors: educational level, job security • Emotional factors: donations, volunteer services
Data from a nationwide telephone survey of 817 men and women was analyzed to examine the general public’s views on the middle-income class. Samples were chosen from households, taking into account gender, age and region. The survey was conducted on February 12-20, 2014. It had a 95percent confidence level and sampling error of plus or minus 3.43 percentage points.
II. Influence of Class Self-Identity on Life Satisfaction 1. Class Self-Identity 75
The life satisfaction index of the middle-income class was much higher than that of the low-income class. In the survey by Hyundai Research Institute, the respondents were asked, “Which income class do you think your family belongs to, considering your social and economic status?� Overall, 69.5 percent of the respondents said they were satisfied with their lives. Among those of the self-perceived middle class, 82.3 percent said they were satisfied with their lives. On the other hand, 55.5 percent of those who felt they were in the low-income bracket expressed satisfaction.
2. Material Factors 76
Obviously, income and net asset push up the standard of living and make consumption possible, influencing the level of life satisfaction. In considering these material factors, total household wealth (salaries, capital, investments, and inheritances) should be taken into account. According to Stiglitz, Sen and Fitoussi (2009), household income plays a more important role in enhancing life satisfaction than individual income.
It was also learned that life satisfaction increases in tandem with rising income and net assets. The level of life satisfaction among people whose after-tax monthly household income averaged 6 million won (US$5,770) or more was 83.8 percent, 27.1 percentage points higher than 56.7 percent cited by people with comparable household income of 3 million won or less. Among people whose households’ net worth was 1 billion won or more, the level of life satisfaction was 86.8 percent, 32.3 percentage points higher than 54.5 percent felt by people whose households’ net worth was 100 million won or less. The rate of increase in life satisfaction slowed beyond 5 million won in average net income per household, but did not fall when net worth was considered.
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Even within the same income bracket, there was a considerable gap in life satisfaction because of individuals’ perception of where their income level places them. Among those whose net monthly average household income was less than 3 million won, the level of life satisfaction was 74.3 percent among those who perceived themselves as middle-income class, but 49.7 percent among those who felt they were in the low-income class. In the case of those whose net monthly average household income was 6 million won or more, life satisfaction of the self-perceived middle-income was 87.9 percent, compared to 64.5 percent of those identifying themselves as low-income class.
In other income brackets, too, life satisfaction of those identifying with the middle-income was about 20 percentage points higher than that of the self-perceived low-income class.
Even at the same level of net worth, there were wide gaps in life satisfaction depending on class consciousness. Among those whose household net worth was less than 100 million won, life satisfaction of the self-perceived middle-income class was 78.3 percent, some 30 percentage points higher than that of the self-perceived low-income class. Among households with 1 billion won or more in net worth, life satisfaction was 88.5 percent among respondents who identified with the middle-income class and 75.0 percent among those identifying with the low-income class.
At other levels of net worth, too, life satisfaction of the self-perceived middle-income class was about 20 percentage points higher than that of the self-perceived low-income class.
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3. Demographic Factors
Demographic factors, such as gender and age, are known to influence life satisfaction because of discrimination and changes in the perception of satisfaction. Among factors that affect life satisfaction, according to Boarini et al. (2012), important gender-related factors are employment and health. 79
These also are the factors that give women greater satisfaction about their lives than men.
According to various research results, including that by Clark (2007), the relationship between life satisfaction and age is U-shaped, meaning that life satisfaction tends to decline as people approach their middle years and rises as they move closer to retirement.
Women generally feel more satisfied about their lives than men, but regardless of gender, there are considerable gaps in life satisfaction between the self-perceived middle-income class and the selfperceived low-income class. Life satisfaction among women who perceive themselves as belonging to the middle-income class was 33.8 percentage points higher than that of women who regard themselves as belonging to the low-income class, while the comparable gap among men was 25.5 percentage points. Generally, as people get older, their life satisfaction tends to drop. But an elderly person’s class perception can mitigate the decline. In all age groups, the self-perceived middle-income class showed higher life satisfaction than the self-perceived low-income class, and the gap was especially noticeable among those over 60.
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4. Life Quality Factors The higher people’s educational levels and the more stable their employment status, the more they tend to feel satisfied about their lives.
Blanchflower and Oswald (2011) explained that higher educational and technical levels help enhance the sense of accomplishment in life and economic ability, which positively influences life satisfaction. Winkelmann and Winkelmann (1998) proved that job insecurity, such as unemployment, lowers life satisfaction significantly.
Even among people at similar educational levels, however, there were considerable gaps in life satisfaction between the self-perceived middle-income class and the self-perceived low-income class. Still, the level of life satisfaction sharply rose among people who have received graduate-level education or higher, and those with only a high school education or lower had markedly low life satisfaction. As for employment, the more secure one’s job is and the higher income it produces, there is a greater possibility one’s life satisfaction goes up. Even among respondents who have jobs with similar characteristics, there was a notable gap in life satisfaction depending on whether they identify with the middle-income class or low-income class. 81
In all employment-related categories, life satisfaction is higher among the self-perceived middle-income class than the self-perceived low-income class, and the gulf widens even more notably when people have insecure jobs.
5. Emotional Factors 82
People who make donations for underprivileged members of society and engage in volunteer services have higher life satisfaction.
Donation and volunteer service enhance life satisfaction in the form of physical and mental health and sense of satisfaction. According to Rietschlin (1998) and others, volunteer services enrich life satisfaction and relieve depressed feelings. Particularly, Anik et al. (2010) discovered that donations for self-centered reasons help increase life satisfaction.
People who donate have higher life satisfaction than those who do not. But regardless of donation, life satisfaction is about 30 percent points higher among the self-perceived middle-income class than the self-perceived low-income class.
People who engage in volunteer services have higher life satisfaction than those who do not. But again, regardless of voluntary services, there is a gap of about 30 percentage points in life satisfaction between the two self-perceived income classes.
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III. Policy Implications In order to improve life satisfaction, expanding the self-perceived middle-income class is crucial. Also important are creating decent jobs, easing job insecurity, and spreading donation culture to help vulnerable members of society. To help increase the people’s income and assets, the government should improve the investment environment of businesses and develop industries that can provide high value-added jobs, thereby providing conditions for creating quality jobs. In particular, support should be given to small and medium-sized enterprises, which can employ a large number of people.
It is important to enhance the quality of living of the general public so that more people will have pride in themselves as members of the middle-income class. Among Koreans who belong to the middle-income class by the OECD standards, 55 percent (according to Hyundai Research Institute’s 2013 survey) think of themselves as belonging to the low-income class. This suggests the need for measures to make these people more self-confident of their social and economic status.
In this regard, the government has to provide a larger number of public rental housing units to reduce the housing cost burdens of households, while supporting actual homebuyers. It also needs to provide public services for childbirth and childcare as well as improve public schooling, thus easing the burden from expensive childcare and private tutoring costs. Also needed are efforts to build cultural and 84
sports infrastructure to help people enjoy their hobbies with family members and friends.
The government ought to offer incentives for social service providers and donors for underprivileged members of society, as well as nurture civic awareness so that people will regard providing services for the underprivileged as a way to enhance their own life satisfaction.
Society-wide efforts are necessary to ease the widespread job insecurity by converting non-regular workers into regular employees and minimize discrimination against non-regular workers. The government should expand social security for the aged and the needy, strengthen the social safety network by raising unemployment allowances and guaranteeing minimum living expenses, readjusting the minimum wage upward to reduce low-income jobs, and expanding the earned income tax credit (EITC).
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<References> Kim Byung-jo (2000), “Characteristics of Koreans’ subjective class consciousness and factors of determination,” Korean Sociology, Vol. 34 (Summer), pp. 241-268. Cho Dong-gi (2006), “Demographic characteristics of middle class and subjective class consciousness,” Korean Demographics, Vol. 29, No. 3, pp. 89-109. Anik et al. (2010), “Feeling Good about Giving: The Benefits (and Costs) of Self-Interested Charitable Behavior,” Harvard Business School Working Paper. Blanchflower and Oswald (2011), “International Happiness: A New View on the Measure of Performance,” Academy of Management Perspectives, pp. 6-22. Gilman and Huebner, “A Review of Life Satisfaction Research with Children and Adolescents,” School Psychology Quarterly, Vol. 18, No. 2, pp. 192-205. Jung et al. (2010), “Factor Related to Perceived Life Satisfaction among the Elderly in South Korea,” Journal of Preventive Medicine and Public Health. OECD (2013a), “How’s Life? 2013: Measuring Well-being.” OECD (2013b), “OECD Guidelines on Measuring Subjective Well-being.” Ree and Alessie (2011), “Life Satisfaction and Age: Dealing with Underidentification in Age-PeriodCohort Models,” Social Science & Medicine, Vol. 73, No. 1, pp. 177-182. Thoits and Hewitt (2001), “Volunteer Work and Well-being,” Journal of Health and Social Behavior, Vol. 42, pp. 115-131.
[Issues and Tasks, 14-34, September 3, 2014, Hyundai Research Institute]
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- Gilt-bronze Burial Shoes Showcase Baekje Artisansâ&#x20AC;&#x2122; Exquisite Craftsmanship - China Dream or China Black Hole? - Why Do So Many Koreans Drop Out of U.S. Schools?
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Gilt-bronze Burial Shoes Showcase Baekje Artisans’ Exquisite Craftsmanship
Chung Jae-suk Culture Editor The JoongAng Ilbo
The Jeongchon Ancient Tombs (Local Cultural Property No. 13 designated by Naju City) has reaffirmed its historical significance as the seat of powerful ruling forces that dominated the Yeongsan River area in the fifth century. Located in Bogam-ri, Naju, South Jeolla Province, the site commands an unobstructed view of the Naju Plain where ripe rice plants bend with the wind.
On October 23, the National Research Institute of Cultural Heritage displayed an array of rare artifacts to the public for the first time. They included gilt-bronze footwear, gold earrings and horse equipment dating back to the Baekje Kingdom (18 B.C.-A.D. 660). Among them, a pair of gilt-bronze burial shoes distinctly stood out. “This pair of burial shoes decorated with a dragon head, a decorative motif usually seen with binyeo, traditional ornamental hairpins of Korean women, is the first of its kind ever discovered, said Lee Sang-jun, director of the Naju National Research Institute of Cultural Heritage. “This discovery suggests that other gilt-bronze footwear that have been excavated from the ancient tomb sites dating back 89
to the Mahan and Baekje eras might have had similar ornaments,” he explained.
Such heavy, hard gilt-bronze shoes were among artifacts buried with the dead in ancient times. Researchers believe that the recently discovered burial shoes were given as a gift by rulers of Baekje to commemorate the death of a local lord of Mahan who governed the Yeongsan River area. Lee added, “Although gilt-bronze shoes have previously been discovered from the tomb of King Muryeong of Baekje, located in Gongju, South Chungcheong Province, they were partially damaged. This time, however, the shoes were recovered in almost perfect condition, with dragon-shaped ornaments intact. They are unique and rare artifacts, so we are planning to utilize their style and design in various ways after completing a patent application.” Lee Han-sang, professor at Daejeon University, explained, “These burial shoes showcase the excellent craftsmanship of Baekje artisans who incorporated the craft skills of Goguryeo, Silla and ancient Japan. These shoes are a masterpiece into which Baekje artisans’ design and skills were all invested. In particular, the perforated dragon design on the bottom of the shoes has a front view of the creature’s face with a bold and detailed description of its nose, ears and teeth. The artistic quality of these burial shoes is excellent enough to be comparable to those made today. They also deserve attention in that burial shoes that have been discovered up until now mostly featured the dragon’s face in profile.” Kim Nak-jung, professor at Chonbuk National University, commented, “The relics discovered from the Jeongchon Ancient Tombs give a glimpse of the process in which the culture of Mahan was gradually absorbed into that of Baekje during the mid to late fifth century.” Kim noted that the dragon motif combined with lotus design indicate Buddhist influence. He added that the burial shoes symbolize prayers of the living for the reincarnation of the dead, as evidenced by the lively and straightforward craftsmanship.
Gold earrings and other personal ornaments show a simple yet sophisticated sense of beauty characteristic of the Baekje period. One of the ancient Three Kingdoms that ruled Korea during much of the first millennium, Baekje incorporated artistic skills from its neighbors, such as Silla and Great Gaya, refining them in their own style. Also noteworthy is the discovery of many metal arrowheads inside a quiver.
How could such a variety of ancient artifacts not be looted and remain in good condition for more
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than 1,600 years? Some elderly villagers said that an old outdoor pavilion that stands above the honeycomb of burial sites overlooking the village has helped protect them from tomb robbers.
The Naju National Research Institute of Cultural Heritage, which is in charge of the survey and excavation of the ancient tomb group, will rename the site the “Tomb of the Dragon-design Golden Shoes” on the occasion of the institute’s 10th anniversary next year. The institute also plans to commit its resources to shedding light on the historical status of Mahan that once ruled over the Bogam-ri area, as well as its relations and exchanges with neighboring states. ♦ Gilt-bronze burial shoes: It is known that burial shoes made of gilt-bronze plates with elaborate openwork patterns were mass produced during the Three Kingdoms period (first century B.C.-A.D. seventh century), most notably in Baekje, which ruled the southwestern part of Korea. A total of 17 pairs of gilt-bronze burial shoes have been so far discovered at 13 historic ruins in the old territories of Mahan and Baekje, including the tomb of King Muryeong and Suchon-ri Ancient Tombs in Gongju, and the No. 1 Tomb of Bongdeok-ri in Gochang County. These burial shoes embody the wishes of descendants that the souls of the deceased would go to a good place in the next world.
[October 24, 2014]
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China Dream or China Black Hole?
Gu Ga-in Staff Reporter The Dong-A Ilbo
It seems there won’t be a second “My Love From the Star.” Online video streaming platforms have played a huge role in the explosive popularity of the hit Korean TV miniseries in China this year. But the drama about an alien from outer space would not have been approved under China’s recently tightened TV regulations.
Korean production companies have chosen the unconventional route of Internet streaming to avoid the new regulations. However, the Chinese government announced on September 3 that starting in April 2015 licenses will be required for foreign dramas and movies for online showing. In addition, foreign content will be limited to 30 percent of total videos.
As an alternative measure, Korean movie companies and Chinese television networks are turning to joint productions. The networks are recruiting star directors, writers and production crew from Korea en masse. Will all this turn out to be a “China dream” or a “China black hole”?
Joint Productions: A Breakthrough Strategy The Korean drama “My Lovable Girl,” which is set to begin airing on September 17, will be shown in real-time in China through online video hosting services Youku and Tudou. Online streaming rights for the show starring Korean singers Rain and Krystal, member of the popular girl group f(x), were 92
sold for US$200,000 (approximately 200 million won) per episode. That is a whopping five-fold leap from “My Love From the Star” ($40,000 per episode), which ended early this year. Industry insiders say the Chinese government’s recent tightening of regulations is leveled at the surging prices of rights for Korean dramas. An industry source who exports television program contents said, “Drama production houses should refrain from bragging about selling their shows for high prices and keep their lips sealed,” and added, “There’s no need to provoke the Chinese government.” Early this year, China’s State Administration of Radio, Film and Television limited the number of foreign-based shows aired on Chinese satellite channels to no more than one per year. It was a major blow to Korean TV show producers. Compared to last year when over 10 shows were sold to China, including “I Am a Singer” “Dad! Where Are We Going?” “We Got Married” “Two Days and One Night” and “Immortal Songs,” only two shows, “Running Man” and “The Return of Superman,” have been sold this year. “Due to stringent controls on television broadcasts, the Internet has been our only way into the Chinese market, but with tighter restrictions imposed on online contents going into effect next year, prospects for contents sales will become bleak,” said an industry official.
Amid stricter regulations, major Korean production companies are teaming up with star directors and writers, and increasing joint productions with China. Pan Entertainment, the producer of the period drama “The Moon Embracing the Sun,” announced that it is co-producing a drama titled “Kill Me, Heal Me” with China’s largest media group, Zhejiang Huace Film & TV Co. The show is reported to have a production budget of around $15 million (15 billion won), and is set for simultaneous broadcast on the Korean television network MBC and in China early next year. Jo Seong-jun, head of public relations at Pan Entertainment, said, “It will feature product placements from Chinese companies.” The producer behind the hit drama “Bread, Love and Dreams,” Samhwa Networks, is also planning to join hands with a Chinese production company and co-produce a period drama based on the classical Chinese novel “Fengshen Yanyi” (The Investiture of the Gods). Shin Woo-chul, director of the hit series “A Gentleman’s Dignity” and “Secret Garden,” will produce the show.
Shin is just one of the rising number of top-tier directors and writers who are making forays into the Chinese market. The highly sought-after “Hong Sisters” (Hong Mi-ran and Hong Jung-eun), the scriptwriting team known for popular hits such as “Master’s Sun“ and “The Greatest Love,” will write 93
a romantic comedy for Chinese viewers. Jin Soo-wan who wrote “The Moon Embracing the Sun” will also be heading to China with “Kill Me, Heal Me,” and Jang Tae-yoo, the director of “My Love From the Star,” has taken a leave of absence from SBS to work on a movie in China. “Camera, art and costume staff as well as famous scriptwriters from Korea will be participating in the project,” said Jang.
With exports of variety shows being hit hard, show producers are also turning to joint productions. Korean television network SBS, Korean production house SM C&C and Chinese Internet television company Youku Tudou recently co-produced the show “Super Junior-M’s Guest House” to be aired next month on SBS and video sites Youku and Tudou. Chinese producers are also keen on joining hands with Korean production companies. “In China, both the quality and quantity of production staff and program contents cannot keep up with the fast-paced growth of the cultural contents industry, which is why they are eager to recruit production staff and adopt advanced production systems from Korea, a country that shares a similar cultural background. This trend is likely to continue for some time,” said Yun Jae-sik, head of the industry policy team at Korea Creative Content Agency (KOCCA).
Rush to China ― Gain or Loss? “It’s the same as going to Hollywood. We’re pursuing greater opportunities and possibilities in China,” said Jang Tae-yoo, director of “My Love From the Star,” who is currently making a movie in China. “But China is not an easy market to penetrate,” said an official in charge of content exports for a Korean broadcasting company. “They are not just going to sit back and allow foreign companies to become a major player in their market. Korean production companies could merely end up as subcontractors.”
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These represent divergent views of industry people in Korea venturing into the Chinese market. The Chinese broadcasting market is huge, but despite showing strong growth, it is also highly unpredictable, which means that bigger opportunities entail higher risks. According to KOCCA, the Chinese market for broadcasting contents was estimated to be over $20 billion (20 trillion won) last year, about three times the size of the Korean market (6 trillion to 7 trillion won). Figures compiled by market analysis firm PwC were also around 20 trillion won, and both organizations forecast doubledigit growth in China over the next five years. With the growth in the size of the market, “love calls” from China have also risen. Whereas in the past, former star producers and film directors were hired, these days, they look for the hottest current writers and producers and in some cases even request whole production systems to be brought into China. Bon Factory CEO Moon Seok-hwan, who is going to China with the Hong Sisters, said, “Chinese producers contacted me and specifically asked for them. I think they are particularly interested in the fluffy romantic comedies that are the trademark of the Hong Sisters, probably because male writers and more serious fare are predominant in China.” An Je-hyeon, CEO of Samhwa Networks, who is producing a historical piece in China with A-list director Shin Woo-chul, also said, “Half of the Chinese production companies who wanted to work with us asked for Shin.”
Almost all of the Korean production companies heading to China are major players in the industry. Samhwa Networks, producer of “Bread, Love and Dreams,” is planning to take writers and 20 production staff to China. As joint productions expand, the workforce joining the rush to China is growing to include even hair and make-up artists. Some express caution about the phenomena, saying, 95
“It’s more like a China black hole, not a China dream.”
To Korean production companies, Chinese investors with deep pockets are a great boon. An official at a drama production company said, “In China, scriptwriters and directors are offered more than two to three times what they get in Korea.” The CEO of a variety show maker also said, “Variety shows in Korea get a production budget of around $70,000 to $100,000 (70 million to 100 million won) per episode, whereas in China that jumps to around $700,000 to $800,000 (700 million to 800 million won). It’s a whole different level.” “It is difficult to cover rising production costs if we limit the market to Korea,” said veteran producer Kim Young-hee, who produced MBC’s talent competition show “I Am a Singer” and participated in an advisory role when the show’s format was sold to China’s Hunan TV. Yu Geon-sik, team head in the drama department at KBS, also noted, “We cannot buck the trend of advancing into the Chinese market. With the opening up of the market, we should blaze new trails and try to secure an early dominance.”
But one should tread with caution. In fact Korean production companies face numerous problems arising from the differences in the two countries’ production system, such as dealing with the government’s censorship from the scriptwriting stage. “There are quite a few production houses that go to China only to return empty-handed because the contract fell through,” commented an official from a domestic broadcasting company. There are also concerns that joint production deals are negotiated in favor of the Chinese. In fact Chinese counterparts hold most of the copyrights to dramas and shows that are co-produced or in which Korean production staffs have participated.
An industry source who exports shows for a domestic television network expressed concern, saying, “Joint productions that involve sharing core competencies are largely avoided in developed countries in order to protect the domestic industry. Transferring expertise and know-how to China would be like raising a tiger.” Dr. Gang Man-seok of KOCCA said, “Joint production may be a new alternative to hallyu [Korean Wave] in China which has implemented strong policies to protect its culture.” But he also advised, “Measures should be discussed at the government level to push for easing of excessive regulations in China and protect our creative talent.”
[September 15-16, 2014]
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Why Do So Many Koreans Drop Out of U.S. Schools?
Duksung Joh (Joh Duk-sung) CEO Ivy Town Educators, Inc.
Five years ago the PhD dissertation of Dr. Samuel Kim at Columbia University rightly pointed out some of the most serious problems of conventional Korean family practices in providing their children a university education in the United States. His thesis was not challenged by the Korean community but the statistics in the dissertation caused a controversy. The statistics were derived from Dr. Kim’s random survey of 1,400 Korean students who have entered the so-called Ivy League universities in the United States over the past 20 years. The survey revealed that only 56 percent of the respondents graduated from the elite universities. The remaining 44 percent dropped out. Also, 25 percent of Chinese students and 21.5 percent of Indian students dropped out, according to other surveys cited in the dissertation.
Since most of the dropouts and their parents were extremely secretive about the non-attendance, other parents naturally questioned the survey results. Also, several private tutoring firms cooperated to reject the usefulness of the study, claiming the statistical data was distorted and exaggerated. And several Korean media reports claimed that the survey only covered Korea-born students who went to the United States to pursue a university degree. In fact, the survey included “all” Korean students. “Korean-American” students were included. 98
Therefore, the survey results concerned ethnic Korean students regardless of their country of birth. But, instead of the research becoming an important resource for Korean parents, the negative reaction pushed Dr. Kim’s critical research to the side, where it is overlooked, and private education businesses continue their improper teaching methods.
The high dropout rates of Korean, Chinese and Indian students seem to be related to cheating and illegal leaks of questions in the U.S. Scholastic Aptitude Test, a standard examination for university admission. A wide variety of other tests conducted in these students’ countries are not immune to the same corrupted treatment. Some Korean test prep centers purchase leaked exam booklets.
Some students benefit from the illicit transactions and have high test scores. Others have high scores due to repeated tutorial programs that teach them how to be good test takers. In the long term, the students become victims. Their mental capability and learning skills remain underdeveloped regardless of their test scores.
It does not help to hide the realities. Trying to avoid embarrassment from exposure outside the Korean community obstructs real improvement. Moreover, since Dr. Kim’s dissertation has already become a must-read among admission officers of top U.S. schools, any suggestion that his findings should be ignored is equivalent to denying invaluable information to parents with respect to their children’s education in American schools.
A lack of proficiency in reading and writing in English is the main reason for Korean students dropping out of U.S. universities or getting into serious trouble involving plagiarism. The U.S. university education system involves extensive reading and essay writing. Even the so-called “bookworms” struggle to keep pace with class assignments, which typically call for reading 600 to 1,000 words per minute and the ability to summarize the content quickly and concisely. Those students who barely managed to pass the entrance exam by repeating exam tutorials or cheating cannot handle the class load.
About three years ago, I met a Korean-American professor at the Duke University medical school and we shared thoughts on the education of second-generation Korean Americans. He recalled that during his school days at Harvard almost all of the students expelled for plagiarism were Koreans.
In the United States, there are numerous Internet companies that assist college students for a fee. Korean students are their main clients, according to the firms and former employees contacted. Even 99
though Korean students have SAT scores that are on par with others, their actual reading and writing skills lag far behind their colleagues. Thus, they end up using homework help services. When they give their professors paid works, they are highly likely to get caught and accused of plagiarism.
If plagiarism is proven, the student is subject to expulsion, the gravest penalty by U.S. schools. Once expelled, the student cannot get admission or transfer to other universities in America. Foreign students have to leave the country. In such cases, both the student and his or her parents suffer from serious psychological distress.
Whenever I come across the fact that more than half of the expelled students on plagiarism are Korean, I cannot but lament the enduring problems that distort the Korean educational culture. Unless thorough reform takes place to eradicate the wrongful perception and practices of English language education for Korean students, the sufferings and dismal realities experienced by our children are likely to persist for decades to come.
Tips for English Language Education I have summed up the key arguments of two previous essays below. I would be grateful if you could pass them on to the people around you to enhance our collective efforts to normalize English language education.
a) The greatest hazard of Korean-style English reading education is a misguided expectation that reading skills can be acquired through classroom-taught exam preparation.
b) Korean-style English reading education is an overdose of lecturing without sufficient emphasis on the student’s self-practice. c) Reading capacity depends on a “trained” brain, not a “gifted” brain. Therefore, it is important to read on a daily basis.
d) The classroom exercise of reading comprehension questions (delivered orally by the teacher) has been overdone and does not work. Without self-practice, exam tutorials only exaggerate a student’s real scholastic capacity.
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e) Learning reading skills alone (no matter how excellent the teacher is) cannot replace reading practice. f) To enhance reading comprehension skills, the ratio of classroom lecture to student’s self-reading should be 30/70, instead of the current 80/20. g) The teacher should not read along with students in order to ensure the student’s own engagement with the text.
h) If the exam score jumps in a short time without sufficient self-practice, the inflated score is most probably due to deceitful tricks or outright cheating. This means, once the student is admitted to a U.S. school, he or she risks major troubles. The student’s self-practice for English reading comprehension is not an option and cannot be compromised. For all those who aim to raise their reading capacity, it is an absolute necessity.
[Huffington Post Korea, September 22, 2014]
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- Toward Justice in Korean Capitalism - Changing Names: Laundering Family Records of Slavery
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Toward Justice in Korean Capitalism
Yang Hong-ju Staff Reporter The Hankook Ilbo
“Capitalism in Korea” By Jang Ha-sung, Hay Books, 724 pages, 28,000 won
Capitalism is nearly the de facto single economic system accepted and sustained in the world. In Korea, modern capitalism turned into pariah capitalism once the economic hegemony was channeled away from the market to the chaebol. In “Capitalism in Korea,” Professor Jang Ha-sung of Korea University focuses on the need to reform Korean capitalism, which is a combination of democratic equality and capitalistic inequality. Professor Jang examines where the Korean economy intersects with justice. He first stresses the unique weakness that can be seen only in Korean capitalism. He then leads readers into having pity on the limitations of Korean capitalism which, not yet fully mature, is exhausted. In 1996, Professor Jang was a founder of People’s Solidarity for Participatory Democracy’s Committee for Economic Democratization, leading a civil movement for economic justice. In his latest book, he designates the destination of Korean capitalism beyond economic democratization, where the economy is just. Envisioning the future of Korean capitalism as where everyone lives well, he says, “We need the kind of distribution that guarantees fair competition, just possession, and minimum civil 103
freedom.” He goes on to emphasize that democracy of equality must work properly so that capitalism of inequality can become just.
Korean capitalism needs to be approached from a different angle, Professor Jang reminds us. From the early 1960s through the 1980s, the planned economy of military governments nurtured industries from which a market economy sprouted. However, no real capitalistic or neoliberal policies have been implemented in the ensuing two decades plus. This means that the global tax on wealth advocated by French economist Thomas Piketty, author of the best-seller “Capital in the Twenty-first Century,” cannot be readily applied; capital has not been sufficiently formed in Korea.
Jang admits that the wrongs need to be set right, for example, income inequality and distorted market system. However, he sees capitalism as something that needs to be corrected, not scrapped. It has been seven years since the global financial crisis broke out and there is no clear sign that capitalism is waning. Jang attributes the survival of capitalism to a lack of better alternatives and says capitalism must be maintained even with its flaws, which require fixing. He proposes some policies to realize “just capitalism.” They include reinforcing the progressive structure of corporate income tax, expanding class action and taxing corporate cash reserves. (The latter already has received government approval.)
[September 20, 2014]
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Changing Names: Laundering Family Records of Slavery
Jeong Won-sik Staff Reporter The Kyunghyang Shinmun
“From Bond Servants to Noblemen: A Long Journey” By Kwon Nae-hyun, Yeoksa Bipyeong Sa [History Criticism Co.], 204 pages, 12,800 won
A man named Kim Heung-bal lived in 18th-century Danseong-hyeon, Gyeongsang Province (currently Sancheong County, South Gyeongsang Province), according to his family registry of 1717. His recorded position was assistant (boin) to the soldiers of the Royal Guards Command (Eoyeongcheong). That means he was a commoner who fulfilled his military duties by providing fabrics to the army. The recorded position of Kim’s father was the same, but the occupations of his grandfather, greatgrandfather and maternal grandfather were not identified. Three years later, in 1720, the family registry was updated with alternative military service recorded for all three men. Did Kim Heung-bal suddenly remember what his ancestors did? In “From Bond Servants to Noblemen: A Long Journey,” Kwon Nae-hyun, history professor at Korea University, explains that commoner Kim’s father, Kim Su-bong, was born a bond servant (nobi). Kim Su-bong broke free from his social status, allowing his descendants to make adjustments in their family registry. By following the traces left in the Joseon family registry, Professor Kwon’s book 105
sheds light on the ascent, on paper, of Su-bong’s family over 200 years, from bond servants to commoners and further on to noblemen.
In the Joseon Dynasty (1392-1910), there were only a few noblemen. The majority of the people were commoners and bond servants. Taking note of this, we can assume that the record of the social ascent of Su-bong’s family can be applied to many ancestors of Korean families. Kim Su-bong’s owner was a nobleman named Sim Jeong-ryang who lived in the same village and owned 58 other bond servants. One way to free oneself from the servant class was to run away, and many did. A look at the noblemen’s family registry shows many bond servants with a recorded age of more than 100. That is because the yangban who could not relinquish the ownership of the runaway servants wrote down the age that they would have reached if they had not run away.
Instead of fleeing, Kim Su-bong chose to buy his way out of slavery. In the 1678 family registry, Subong was put down as a bond servant, but in the 1717 registry, he and his sons had all become commoners. The hint comes from his alternative service as “napsok tongjeong daebu” in the 1717 registry, a title given to those who provided some type of financial assets to the government. In Kim Su-bong’s case he secured his new status in the wake of the great famine of 1695-1696, which claimed 1.41 million lives. At the time, natural disasters and subsequent need for relief spending had depleted the government’s fiscal resources. This provided an opportunity to wealthy bond servants like Kim, who supplied grain to the government. In Dosan-myeon, where Kim lived, bond servants decreased from 42 percent of the population in 1678 to 27 percent in 1717.
The right to choose another family name and place of clan origin accompanied higher social class. Descendants of bond servants-turned-commoners changed their names frequently with the intention of erasing their ancestors’ past.
According to the records of the family registry, Kim owned bond servants himself. Such cases were rare and the ownership was passed down to sons. At the time, it was possible for bond servants to inherit assets and to purchase land with their money. Kim’s descendants were not satisfied with their commoner status. Being a commoner was better than being a bond servant, but the burden of military duties was unforgiving. His great-grandson, named Kim X-oh (full name is unknown), fulfilled his military duties as a commoner in 1759 when he was 106
21 years old, but 20 years later, he was listed as a yuhak (literally “Confucian scholar”), referring to a nobleman who does not hold a government position. It was an alternative to military service reserved for the yangban nobility only. Only three years after the nobleman’s title appeared, his alternative service was back to commoner. However, toward the mid-19th century, most of Kim Su-bong’s descendants were identified as yuhak in the family registry. In short, the family had transformed itself into a noble family after 200 years. Still, that did not mean the true yangban treated them with equal respect. None of Kim Su-bong’s descendants married into a true yangban family.
Is a class society in which your destiny is determined at birth a thing of the past? The author says, “Today, educational background and wealth are gradually becoming a privilege and show signs of being handed down from parents to their children. The new yangban class is in the making for whom the starting line is far ahead the others from birth.” He goes on, “As for those who were shoved from the ladder of upward mobility, are they to devote their lifetime and their children’s lifetime looking for the next chance as the Kim family did? Kim Su-bong’s descendants, and even Sim Jeong-ryang’s descendants, probably do not want to see the history repeat itself.”
[September 6, 2014]
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- Ahn Hwi-joon: “Repatriating cultural properties requires wisdom of a hunting lion.” - Seung Hyo-sang, Seoul’s First ‘City Architect’
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Ahn Hwi-joon: “Repatriating cultural properties requires wisdom of a hunting lion.”
Choe Hyeon-mi Assistant Culture Editor The Munhwa Ilbo
There were many topics I wanted to discuss when I met Professor Ahn Hwi-joon, 74, chairman of the Overseas Korean Cultural Heritage Foundation. Topping the list was the current controversy surrounding the theft of two Buddhist sculptures from Japan.
The controversy began in October last year, when a band of thieves specializing in cultural artifacts stole two Buddhist sculptures from the Japanese island of Tsushima and were caught trying to smuggle them into Korea. The two sculptures are exquisite works, one a bronze standing Buddha made in the Unified Silla period (676-935), and the other a seated figure of the bodhisattva Avalokitesvara made in the Goryeo Dynasty (918-1392). The case drew even greater attention when it was claimed the Avalokitesvara sculpture was originally owned by Buseok Temple in Seosan, Korea.
These two sculptures are currently at the National Research Institute of Cultural Heritage, locked away in a storeroom with a “Keep Out” sign on the door. Some insist that there is no need to return them to Japan since they were stolen by Japan in the first place, while others argue that they must be returned considering there is no clear proof that they were stolen and they were brought into Korea through thievery.
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While the controversy can be boiled down to the fate of the artifacts, there are more complicated issues underlying the debate such as the definition of “pillaged cultural properties,” grounds for return of cultural properties, and practical means of repatriating cultural properties. Moreover, if we lift the lid on the issue, the Korean people’s ambiguous attitude to cultural heritage is like a tangled web of vines: when cultural heritage becomes a social issue public opinion flares up for a while but otherwise the general public shows little interest in the subject, and while people loudly argue that cultural properties kept overseas must be brought home and lament the poor state of Korean galleries at museums in other countries, they hesitate when asked if they would be willing to donate to the cause.
So the time was ripe to hear the opinions of the head of the Overseas Korean Cultural Heritage Foundation, which was established to carry out systematic survey and research, utilization and publicity of the cultural properties in question.
During our interview at his office in Jung-gu, Seoul, on September 12, Chairman Ahn emphasized the need for a long-range view on all matters regarding cultural properties. We must not “pursue small gains only to suffer great loss,” he said.
As a pioneering art historian specializing in Korean painting, Ahn has served as director of the Seoul National University Museum, and head of the Cultural Heritage Committee. He has the confidence and realistic sense of balance found in those armed with the necessary academic background and working experience, and out of his true love for the nation’s cultural heritage does not hesitate to chastise society’s attitude.
The interview started with the talk of principles, moved on to cover a wide range of issues such as repatriation of cultural properties overseas and their utilization and publicity, and inevitably ended with a call for the public to take genuine interest in the issue. Q. I’d like to start with the stolen Buddhist sculptures. What is your opinion on the matter?
A. My connection with Seosan [where Buseok Temple is located] and its cultural heritage goes back some 40 to 50 years as it is the hometown of the Joseon Dynasty painter Ahn Gyeon. But I don’t visit that place these days. If I go there, people will ask for my opinion [on the stolen Buddhist sculptures] but when I say what I think, the local media won’t leave me alone. One unified principle must be 110
applied to all matters related to cultural properties. Regardless of nation or time period, illegal acts cannot be permitted. This is a standard that is always applicable. When the Buddhist sculptures from Tsushima entered the country, the government should have made sure they were returned. The issue has now become complicated (with the ruling by a district court that they did not have to be returned unless clear evidence is found that Japan obtained the sculptures through normal channels), but as soon as it is resolved I believe the sculptures should be sent back. Then it will be possible for us to ask Japan to also return any cultural treasures that they had taken in the past by illegal means. Giving up the Seosan sculpture is the way to secure justification for the return of many other culture properties.
Q. The argument that there is no need to return cultural properties that were looted in the first place agrees with public sentiment.
A. Many people think the Avalokitesvara sculpture must not be returned because it was stolen by Japanese pirates in the first place. It is true that the Japanese pirates did a lot of looting and it is likely that Goryeo Buddhist paintings were included in their plunder. But if no decisive documented evidence is quickly found to prove our assumptions, then those artifacts cannot be brought home. The Buddhist sculptures should have been returned [to Japan] quickly. Some will criticize me for saying such a thing as the head of an organization whose job is to repatriate cultural properties overseas. But through the return of one sculpture, we must aim to bring back tens of thousands of other cultural properties. When it comes to cultural properties we should not pursue small gains only to suffer great loss. Though it may take some time, whether the issue is repatriation or utilization of overseas cultural properties, we need to approach the matter methodically and systematically by first gaining a thorough understanding of the situation. Q. Does that mean the foundationâ&#x20AC;&#x2122;s most important basic task is to attain a grasp of the Korean cultural properties kept in other countries? A. Thatâ&#x20AC;&#x2122;s our most urgent task. It is estimated that some 156,000 Korean cultural properties are preserved overseas but no accurate fact-finding survey has been made. However, the number of items is not the real issue; we need to conduct a thorough survey of the type of artifacts being kept abroad, the time period they came from, and whether they were looted or given on friendly terms between Korea and the concerned country. In the course of such research, the number of artifacts may reach 300,000 or even 500,000. Over the past year the foundation surveyed some 1,000 items. This is a
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notable achievement. Over the years the National Research Institute of Cultural Heritage had surveyed the Korean collections of overseas museums and other major public institutions. Our foundation is now extending that survey to private collections. Only when the situation has been properly assessed can we decide which cultural properties we should try to repatriate.
Q. Of the Korean cultural properties the foundation has surveyed, are there any items that urgently need to be repatriated, any that must be brought home at all costs?
A. Most of the earthenware vessels and folk items overseas were clearly stolen but few have been found to be of National Treasure or Treasure standard. In bringing items back to Korea, the important thing is to keep the whole matter quiet until they are actually back in the country. In the first instance of the return of the uigwe (records of the state ceremonies of Joseon) that were taken by French soldiers from Oegyujanggak, an outer branch of the Joseon royal library, the news was made public ahead of time and as a result only one book was returned. We should have maintained a poker face and shown no reaction until the books had entered the country. In some ways, the government was inept in handling the matter. Many times the person who sat at the negotiating table knew nothing about the cultural artifacts and had not consulted specialists in the field.
Q. So negotiating skills are necessary not only for trade but also for the return of cultural properties.
A. Of course. In the case of repatriating cultural properties, it is most important and desirable that the task be handled through diplomatic negotiations. In this sense, it is necessary for officials of the Ministry of Foreign Affairs to be knowledgeable in culture and cultural heritage. It is my understanding that in some countries diplomats are given such training, but this does not yet apply to Korea.
Q. Which cultural properties should we seek to repatriate?
A. Koreans have three misconceptions regarding cultural properties preserved overseas. First, that all such artifacts were looted; second, that all of them must be returned; and third, that we should not pay any repatriation costs. But not all Korean cultural properties in other countries were stolen. Indeed, a large number of them were taken out of the country through friendly channels, for example, as the result of diplomatic and trade relations, or gifts between individuals. Almost all of such artifacts in China made their way to the country through diplomatic channels. Therefore, the number of works to be repatriated is very limited. Cultural properties subject to repatriation are those that were clearly 112
looted, that represent a type not found in Korea, that are necessary to recover our history, or that are of National Treasure or Treasure standard. As for the rest, it is more meaningful that they remain where they are and be utilized to introduce Korean history and culture to other countries. Cultural properties can be repatriated in different ways, for example, through diplomatic negotiations between countries, purchased with our own money, received on loan or entrustment, and through government negotiations. But the overriding view is that cultural properties must be brought back at no cost to us. It’s very frustrating when even some highly educated people think this way.
As one example of a successful case of proper survey and repatriation, Ahn mentions the Joseon Buddhist painting of the “Sakyamuni Triad,” which was returned to Korea in October 2013, after an absence of some 100 years. The foundation discovered the painting in May 2013 in a storeroom at the Hermitage Museum in Virginia, United States, during a survey of overseas cultural relics. Cautiously, the foundation approached the museum regarding its possible return to Korea. The Hermitage Museum, convinced that the painting would be better looked after and seen by more people back in Korea, decided to return the painting as a gift. Under the Cultural Heritage Administration’s corporate social responsibility program, “One Cultural Heritage, One Keeper,” Riot Games Korea in the United States made a donation to the Hermitage Museum.
Q. You emphasize the need to do things quietly, while the monk Hyemun, an advocate for the repatriation of cultural properties, has criticized you for not being assertive enough. What’s your opinion on the matter? A. I’d rather talk about principles than any particular individual. As I have already said, repatriation of cultural properties should be done quietly. To use the hunting metaphor, does a tiger or lion make a clamor when hunting down a sheep or rabbit? At the slightest noise, the prey flees and can’t be caught. The beast waits and bides its time, looking for the right chance. The repatriation of cultural properties works in similar fashion. We have to put in a lot of preparatory work and then wait. If we make a great fuss over the return of one or two artifacts, this will be taken as a sign that we have no interest in the repatriation of the rest. If we rush about and make a fuss, we may succeed in bringing back one cultural property but all the others will be hidden away. When we identify an individual with a Korean cultural property, if we start clamoring for its return, claiming that it was stolen in the first place, what’s the likelihood of that person agreeing? Other individuals or organizations with Korean artworks would flee. We have to make sure that doesn’t happen. Q. What’s the best way to divide roles between private organizations and the government? 113
A. The government and private organizations must work closely together. We shouldnâ&#x20AC;&#x2122;t be disorganized. Under a unified policy we must help each other. Thereâ&#x20AC;&#x2122;s no room for cracks in the surface. If the private sector waits until a fact-finding survey is completed, there will be a lot of work for them to do, too. For example, after the foundation has made a complete survey, naturally the next step is to decide the best way to bring our cultural properties back by identifying who the owner knows in Korea, who will be the best person to make the approach without offending the owner, and which method of proceeding is the most friendly and constructive. We must not make a fuss over a few returned items. There are at least 156,000 Korean cultural properties overseas. We have to think about them as a whole, and proceed with a broad-sighted and long-range plan.
Q. What is your estimate of the proportion of repatriation to utilization in local societies? What is the best way to make use of cultural properties overseas?
A. Local utilization is viewed as the opposite of repatriation, but both are equally important. Most of our cultural properties overseas are out of sight, just as the royal documents of Joseon from Oegyujanggak were stored in the National Library of France. Many Korean cultural properties are languishing in underground storages. We have to find ways to have them displayed so they can introduce Korean culture to the local communities. But we canâ&#x20AC;&#x2122;t do this directly since they are owned and managed by different individuals and organizations abroad. So we invite curators from foreign museums to Korea and ask them to check whether they own any Korean artifacts, and if so to make use of them. If the items are not in good condition, we offer to restore them with our workforce and our money. If such exchange becomes more common, the substance of Korean galleries in foreign museums will expand. In this sense, local utilization is even more important than repatriation. 114
Q. Are the repatriated cultural properties being properly managed?
A. In many cases the item in question is forgotten once it comes home. No matter which route or method was used in their return, repatriated cultural properties are like our sons and daughters. If we forget how precious they are, we are no different than irresponsible parents. We have to publicize returned cultural properties and properly express our gratitude to the returning parties. That way, countries in a position to return cultural properties to us will feel more inclined to do so. In November last year, the foundation published “Gyeomjae Jeong Seon Album of Paintings Returned to the Waegwan Abbey” as the first volume in a series titled “Repatriated Cultural Properties” and organized an exhibition of the paintings at the National Palace Museum. The album of paintings by Jeong Seon (1676-1759) found its way to Germany in 1925 when Father Norbert Weber, head of St. Ottilien Archabbey, purchased the album on a visit to Korea. Thanks to the efforts of Father Seon Ji-hoon at Waegwan Abbey in Korea, they were repatriated to Korea on permanent loan in October 2005. Q. Repatriation, utilization, post-management. There’s a lot of work to be done. What is your greatest difficulty?
A. As the first director of the foundation, I have found there is a severe lack of three things: personnel, budget, and facilities. Ideally, we should have a complete collection of related books and give the public access to them, but we simply don’t have the space for that. We can’t even complain for fear of attracting criticism for making demands without seeing any results in repatriation of cultural properties. We have no choice but to wait until the perception of the government and the public changes. Fortunately, an increasing number of organizations have shown willingness to help. You can’t imagine how happy and grateful we are.
When asked to specify the shortfalls in the annual budget and workforce, Ahn said the gap was so wide that he didn’t want to talk about it. Instead he asked an employee who was on hand to explain. The annual budget, including wages, is 300 million won and the staff, responsible for surveying the state of Korean cultural properties scattered around the world, consists of just three people. As such, Ahn says that under the present conditions it would take at least 10 years to conduct a general survey of Korean cultural properties scattered abroad. “We must be the government organization that is most efficiently run on the most sparing budget,” he says. “We hope people realize how hard we’re working under difficult conditions.”
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Q. Next year is the 50th anniversary of Korea-Japan diplomatic relations. Along with the “comfort women” issue, the repatriation of cultural properties is one of the biggest pending issues between the two countries. What preparations are being made?
A. Cultural properties were an issue when relations between Korea and Japan were first normalized. At the time, we asked for the return of 3,000 to 4,000 artifacts, but only received 1,432 items. Those returned were not necessarily the ones we had asked for. Some inferior objects were sent back along with the major items. Our abilities were limited back then. We had not carried out a proper factfinding survey, and as economic cooperation was urgent we could not raise objections. We must make sure that such a situation is never repeated. Toward that end, Koreans must learn about and care about their cultural heritage. Q. The sentiment of the Korean people can’t be ignored when talking about cultural properties stolen by Japan. What are the principles regarding stolen cultural properties?
A. Around half of all Korean cultural properties overseas are in Japanese hands. It is estimated that Japan has about 70,000 objects and the figure may be several times higher if we count those in the possession of individuals. But with the strain in relations between the two countries we cannot hope for repatriation on the government level. At times such as these, we need to make use of any openings in the fields of culture and cultural properties. History aside, there are many just and principled Japanese people in the cultural field. Why did the Japanese take Korean artworks in the first place? They did because the artifacts were valuable, of course, but also because they recognized the cultural level of Korea at the time. We have to acknowledge this, hard as it may be. So if we go about accusing them of being thieves because their forefathers were thieves, then the chances of having our cultural properties returned are slim. We need to express gratitude for their interest in our cultural properties and then, politely reminding them that they were not taken legally, request that they be returned by proper means. Q. What are the foundation’s plans for the future?
A. We have no special plans. It is important that we work hard and be more active, sticking by our principles. We will be working on long-term projects under long-term plans. It will take time to determine exactly how many and what kind of Korean cultural properties are abroad. That’s one job we have to continue, even if no visible results come out of it. We have no desire to blow our own horn over some dazzling achievements. We hope to educate more Koreans about the situation regarding 116
cultural properties overseas and make sure that the countless artifacts gathering dust in private storerooms are brought out and displayed in museums and other institutions. We will have to bear our three difficulties, that is, make up for the shortage in our own workforce by making use of outside experts, spend our limited budget wisely, and submit to the lack of facilities. As far as events go, as part of our post-management of repatriated properties, we are planning an exhibition, seminar and other events on the Terauchi Collection this November. This collection, brought back to Korea by Park Jae-kyu, president of Kyungnam University, refers to the works collected by Terauchi Masatake, the first governor-general during Japan’s occupation of Korea. Some may criticize us for dealing with a Japanese collection, but the fact is that the biggest number of Korean cultural properties of the highest quality can be found in Japan. Despite the criticism and tenuous Korea-Japan relations, it is important to show the artifacts to the Korean public.
Q. Do you have any appeals to make in relation to cultural properties? A. Korea’s cultural properties are an embodiment of our nation’s creativity, wisdom, intelligence, thoughts, philosophy, and religion. Our ancestors did not know the value of the things they had. Busy making a living, they did not know why cultural properties were important nor which ones were valuable. I believe that the three great tasks of the government are defense of the nation, protection of the people, and handing down our cultural heritage intact to posterity. It is my hope that the government and public servants will realize this and establish a policy accordingly, and that all Koreans will learn to care about the nation’s cultural properties. History speaks of the undeniable fact that human talent and cultural artifacts end up with those who know how to treasure them. They do not go to those who will not cherish them. It is my hope that everyone will realize the preciousness of our cultural properties and learn how to value them.
[September 19, 2014]
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Seung Hyo-sang, Seoul’s First ‘City Architect’
Eum Seong-won Staff Reporter The Hankyoreh
The Seoul Metropolitan Government announced on September 10 that it has appointed Seung Hyosang (a.k.a. Seung H-Sang), 62, as its first official “city architect.” Seung will advise Seoul Mayor Park Won-soon on all issues related to Seoul’s urban planning, architectural culture and development of public spaces. As such, the capital’s future urban policies are likely to be heavily infused with Seung’s architectural philosophy. To Seung, architecture is not art. “Strictly speaking, even a private building is not a personal possession since it affects other people. I think the greatest virtue of architecture is its public value,” he said. A good example of his work is Welcomm City in Jangchung-dong, Seoul. Seung’s client wanted six lots of land to be merged for a single monolithic structure but the architect persuaded him to refocus and ended up designing four connected buildings. The design was praised for preserving the land, as well as achieving perfect harmony with its surroundings. Seung said that he strongly urged the land lots not be merged for the project and that an historic road at the site be preserved. As for the Sewoon District No. 4 redevelopment plan currently moving ahead under Seoul City’s SH Corporation, Seung said, “I will do everything in my power to stop” a high-rise building from going up in front of Jongmyo [the royal shrine of the Joseon Dynasty and UNESCO World Heritage site).
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We met with Seung on September 1 at IROJE Architects & Planners in Daehangno, central Seoul. He is the founder and CEO of of the firm.
Q. What exactly is the role of city architect? A. Until now, Seoul City’s architecture and urban policies were dispersed over different departments. There was no one overseeing the entire process except the mayor. But the mayor is not an expert. Lack of coordination among departments has led to policy inconsistencies. For example, in the case of a public space in Seoul that is a popular spot among citizens, responsibility is split among different people in charge of architecture, civil engineering, roads or subway. It is not uncommon to see a place being dug at different times due to waterworks or to install electricity. This can be ascribed to an absence of a cohesive plan and no one placed in charge of the overall process. There needs to be one person in the supervisory role.
Q. As an architect, what do you think is the beauty of Seoul?
A. Seoul is the only city with a population of over 10 million that is built in a mountainous area. The mountains are the landmark of Seoul. Due to the mountainous terrain, small buildings were built on small plots of land in accordance with the topography. These small buildings that together form the landscape of Seoul constitute the architectural beauty of Korea.
Q. What should be the future direction of Seoul’s urban policy? A. Both the European Parliament and UNESCO have established “principles for preserving historic 119
villages” several times, and there are a number of things that they say in common: Do not merge lots; preserve public roads; preserve the terrain; and preserve people’s way of life, that is, if people in the area work in commerce and industry, then allow them to continue doing that. These are some of the essential points that we must bear in mind when we consider redeveloping areas inside the four main gates of ancient Seoul. But this is not just limited to central Seoul; it also relates to other areas of the city, and if possible we should try not to change the land lots. Q. As part of the Sewoon District No. 4 redevelopment project, Seoul City’s SH Corporation plans to erect a high-rise building. A. The redevelopment plan should be scrapped. I’m going to do everything within my power as the chairman of Seoul City’s architectural policy planning committee to stop it. The areas around Seoul City Hall and Dongdaemun [East Gate] are already a dense forest of high-rises, and if another goes up in Sewoon District No. 4, a belt of high-rises would in effect act as a barrier dividing the area into north and south, giving the city a claustrophobic feel. This is a grave matter of whether we will be able to protect Seoul from reckless redevelopment. Also, the area around Jongmyo shrine should be preserved as a place of sanctity. A city needs a sacred place if it is to endure.
Q. Seoul City announced plans to remodel Sewoon Shopping Mall and transform the overpass near Seoul Station into a “garden in the air.”
A. I am in charge of the Sewoon Shopping Mall remodeling. In the past, projects like this were focused on delivering a spectacular makeover, so were far removed from the actual lives of the people. I am planning to build a walking deck on the second floor of the Sewoon Shopping Mall, which stretches from Jongmyo to Namsan. Due to the Cheonggye Stream, most roads in Seoul extend east and west, rather than north and south. Once the Sewoon pedestrian passage is complete, the roads running east and west will be connected vertically. Also, the Seoul Station overpass will connect the areas inside and outside of the Seoul Fortress Wall. Just imagine how great it will be to travel 20 kilometers from the Han River all the way to Mt. Bugak on foot, by way of Seoul Station overpass, Namsan, Sewoon Shopping Mall and Jongmyo. Once the projects are complete, Seoul citizens will be able to truly appreciate the charm of a walk-friendly city.
Q. What image of Seoul do you want to promote to people around the world?
A. The Seoul Fortress Wall is a city wall that is unlike any other in the world. Fortified walls in the 120
West or Japan were built for a particular clan or community. Also, they were built on flat land to set boundaries. In contrast, Seoul is the only city in the world with a fortress wall built along the contours of mountain ridges. The emblem of Seoul City features the sun, mountains and a river, but I think it should be changed to a mountain and fortress wall, which represents the distinctive image of Seoul.
Q. This year marks the 25th anniversary of your architecture firm. A. It’s been a quarter of a century, so I’m planning an exhibition. I personally made all the furniture that went into the buildings I’ve designed so far. I intend to hold an exhibition of my furniture collection. There’s a misconception in Korea that urban design, architecture and furniture design are all separate realms. I have continuously strived to break down the boundaries. People know that I do urban design, but not many know that I also make furniture. I believe that I can illustrate my concept of a city through a single piece of furniture.
[September 11, 2014]
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COPYRIGHT Korea Focus is a monthly webzine (www.koreafocus.or.kr), featuring commentaries and essays on Korean politics, economy, society and culture, as well as relevant international issues. The articles are selected from leading Korean newspapers, magazines, journals and academic papers from prestigious forums. The content is the property of the Korea Foundation and is protected by copyright and other intellectual property laws. If it is needed to reprint an article(s) from Korea Focus, please forward your request for reprint permission by fax or via e-mail. Address: The Korea Foundation Seocho P.O. Box 227, Diplomatic Center Building, 2558 Nambusunhwanno, Seocho-gu, Seoul, 137863, Korea Tel: (82-2) 2151-6526 Fax: (82-2) 2151-6592 E-mail: koreafocus@kf.or.kr ISBN 979-11-5604-105-4
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 â&#x201C;&#x2019; The Korea Foundation 2014 All rights reserved.
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