Seoul World’s 5th Most Expensive City

Seoul ranked as the fifth most expensive city to live in, according to a world-renowned consulting firm, Wednesday.

Mercer's recent Cost of Living Survey, which covered 143 cities, showed Moscow as No. 1, followed by Tokyo, London and Oslo.

The survey took into account the cost of 200 items including housing, transport, food, clothing, household necessities and entertainment.

"The higher cost of living for cities such as Seoul, Singapore and India can be attributed to their highly valued quality of living," said Yvonne Traber, Mercer's principal research manager.

Reflecting the current inflationary pressures and the weakened dollar, the researcher pointed out the risk of higher living costs, especially for expatriate-level housing and other services. The Mercer survey is regarded as the most comprehensive cost of living survey, which helps multinational companies and governments determine compensation allowances for their expatriate employees.

In the survey, Moscow was the world's most expensive city for expats for the third consecutive year, while the Paraguayan capital of Asuncion turned out to be the least expensive for the sixth consecutive year.

Three of the world's top 10 costliest cities for expatriates are in Asia. Besides Tokyo and Seoul, the third entry was Hong Kong.

Among other Asian cities, Shanghai climbed two rungs to 24th, while Beijing remained unchanged at 20th.

In Vietnam, Hanoi dropped 35 places to rank 91st and Ho Chi Minh city fell 40 places to 100th.

An increase in residential property prices has helped Singapore climb one notch to 13th. Jakarta and Bangkok were 55th and 95th, respectively.

"Despite Asian cities dominating the top 10 most expensive places to live, the cost of living in Asia will not deter many companies and their employees as Asia is the current focus for foreign direct investment from multinational bodies for higher growth revenue," Asia Pacific Information Product Solutions chief Neo Siew Khim said.

Analysts say the external economic outlook for emerging East Asia has dimmed amid prospects for slower growth, tighter credit conditions and higher inflation, which is pushing Asian central banks to tighten their monetary policies.

http://www.koreatimes.co.kr/www/news/biz/2008/07/123_28078.html ◦

Seoul World’s 5th Most Expensive City

Korean Wives Decide Where the Money Gets Spent

Korea is behind other countries in terms of gender equality, but is not so when it comes to who controls the household budget. Statistics show that women in two out of every three couples are in charge of the money.



The National Statistical Office (NSO) published the Life of Woman in Statistics report to commemorate the week of women, running from July 1 through July 7.

The report showed that wives in 65.3 percent of households determined where money was spent. 29 percent said the husband and the wife jointly decide, and only 5.7 percent left the man in charge.

Women also controlled the education of children ― as to which private institute they should go. Only 3.1 percent had fathers decide children's education while 39.2 percent left it totally to moms. The rest made decisions jointly.

The statistics show that around half of women are economically active. Women in their 40s were the most active, with 65.8 percent participating in economic activities. For those in their 30s, meanwhile, the ratio was 56.3 percent, reflecting the fact that many women of this age quit their jobs to take care of kids, returning to the job market later.

The results showed that an increasing number of women succeeded in getting good jobs. Some 19.3 percent of females were in professional or managerial level positions, up 7.1 percentage points from a decade ago. Among rookie diplomats who passed the difficult government exam last year, two out of three were female. Among lawmakers, 41 out of a total 299, or 13.7 percent, were women. Although this is still low compared with other countries, the ratio has been rising continuously. In 1996, only 3 percent of lawmakers were female.

In some workplaces there are too many women. About 73 percent of teachers at elementary schools were female. In 1990, the figure was only 50.1 percent.

Women are getting married older than before. The average age of a first time bride was 28.1. Grooms, meanwhile, were 31.1 years old on average. In 2000, however, brides were 26.5 years old, and grooms, 29.3 years.

Things have gotten better for baby girls as well. Parents are not preferring boys as much as before. There were 107.4 boys born to every 100 girls in 2006, while a decade ago it was 111.6 boys to every 100 girls.

Korea's female population totaled 24.19 million, or 49.8 percent of the entire population. They can expect to live to 82.36 years on average, 6.62 years more than males whose life expectancy hovered around 75.74 years. The gap has been decreasing since 1985, when women outlived men by 8.37 years.

The biggest death factor for women in 2006 was cancer, followed by cerebro-vascular disease, heart disease, diabetes and suicide.

Last year, 29,140 foreign women married Korean men, and 9,351 married foreign men.

◦

Korean Wives Decide Where the Money Gets Spent

Speaking a Foreign Language is Sexy in Korea

Tip for men on a blind date: learn some foreign words beforehand. Women are impressed, according to a survey.

"I like men speaking good English. It makes them look sexy, intelligent and very competent,'' said Yang Mi-kyoung, a 24-year-old who works for a fashion goods company.

"They also look very confident and I feel I could proudly introduce him to anyone,'' she added.

"I would like to marry a woman who can teach our future children English by herself. I know it sounds a bit selfish but we can save money and they can learn the language during life,'' Kim, who works at a construction company, said.

Matchmaking company Duo and English educational institute franchise YBMSisa.com conducted a survey of 242 single males and 315 females and found more than 66 percent of males and 82 percent of women have had experience of being attracted to the opposite sex with good foreign language skills.

Most replied that fluent foreign language speaking skills made their date eligible and competent, while some said the quality is important because they themselves do not have it. Both men and women thought being able to speak other languages is a basic attainment for everyone. Some said they want their counterpart to teach their future children English.

Moreover, 31 percent of women said a man's foreign language skill guarantees better income, indicating economics is a key reason for attraction.

However, the respondents themselves had little expectation for themselves in improving their language skills. About 77 percent said they have studied other languages after work. However, they said it was for their own satisfaction and that all they need is to be able to watch movies without having to read the captions below all the time. Instead, they had high hopes for their future spouses. The majority said they want the other to speak other languages in life.

http://www.koreatimes.co.kr/www/news/nation/2008/07/117_26926.html ◦

Speaking a Foreign Language is Sexy in Korea

South Korea to resume U.S. beef imports

South Korea's government announced Thursday it is going ahead with a much-criticized deal to resume imports of U.S. beef — a move that could escalate the daily street protests against the plan.

Agriculture Minister Chung Woon-chun said in a nationally televised announcement that the government has finalized new quarantine regulations for U.S. beef in accordance with an April 18 agreement with Washington.

The new regulations call for South Korea to import nearly all cuts of American beef without restrictions on the age of the cattle. That represents a significant easing of previous rules, which banned imports of meat attached to bones or from older cattle considered more susceptible to mad cow disease.
The relaxed rules will take effect as soon as they are published in a government journal in a few days.

Thursday's announcement, which had been delayed amid anti-government protests, was the final administrative step necessary to resume U.S. beef imports.

It cleared the way for American beef to return to South Korean store shelves for the first time since last year, when limited imports were briefly allowed before again being suspended.

Some 5,300 tons of U.S. beef, shipped earlier to South Korea but held in customs and quarantine storage facilities, will begin undergoing inspections early next week before being put on the market, according to the ministry.

Chung sought to dispel public concern over mad cow disease, saying the government would immediately halt imports if a new case of the illness breaks out in the United States, and would strictly control cattle parts banned over the disease.

"The government will protect the people's heath and food safety by thoroughly managing the inspection and distribution of U.S. beef," he said.

Still, the announcement is likely to intensify anti-government rallies in Seoul, which have been held on a near-daily basis in recent weeks to protest the agreement. Protesters believe the accord does not adequately protect the country from infected beef.

A small group of protesters staged a rally Thursday outside the government building where the announcement was made. Police estimated some 10,000 protesters would gather Thursday night in central Seoul for a rally.

Under the deal, South Korea pledged to scrap nearly all the quarantine restrictions imposed by the previous government to guard against mad cow disease. South Korea suspended imports of U.S. beef after the first American case of mad cow disease appeared in December 2003 in a Canadian-born cow in Washington state. Two subsequent cases were also discovered.
Several efforts to resume imports foundered after banned substances such as bones were discovered in shipments from the U.S.

Protesters accuse the government of ignoring their concerns about food safety. Worries about mad cow disease have been fanned by some sensational media reports, but both governments have repeatedly said American beef poses no health risk.

Scientists believe mad cow disease, or bovine spongiform encephalopathy, spreads when farmers feed cattle recycled meat and bones from infected animals. The U.S. banned recycled feeds in 1997. In humans, eating meat products contaminated with the cattle disease is linked to variant Creutzfeldt-Jakob disease, a rare and fatal malady.

The rallies, which began in early May, have been mostly peaceful, although tensions flared this week after the government instructed police to take a harder line.

Police have detained more than 200 protesters in recent days, later releasing 92.

The protests are a major headache for President Lee Myung-bak, who took office three months ago. He sought last week to reassure the country over the safety of U.S. beef, but failed to ease public anger.

Critics accuse Lee of making too many concessions on the beef issue in an attempt to gain U.S. congressional approval for a broader bilateral free trade agreement.

http://news.yahoo.com/s/ap/20080529/ap_on_re_as/skorea_us_beef_6

◦

South Korea to resume U.S. beef imports

Women in South Korea - Cracks in the Glass Ceiling

South Koreans are a bit conflicted about career women. Gender wasn't much of an issue in the selection of a female astronaut to fly this month on the country's first space mission. But when women are seeking workaday corporate jobs, some South Korean men still resist change. Outer space is one thing, but a woman in the next cubicle is something else.

For years, most educated women in South Korea who wanted to work could follow but one career path, which began and ended with teaching. The situation started to change after the 1998 Asian financial crisis. Thousands of men lost their jobs or took salary cuts, and their wives had to pick up the slack by starting businesses in their homes or seeking part-time work. A couple of years later, the government banned gender discrimination in the workplace and required businesses with more than 500 employees to set up child-care facilities. It also created a Gender Equality Ministry.

These days the government hires thousands of women (42% of its new employees last year), many for senior positions in the judiciary, international trade administration, and foreign service. Startups and foreign companies also employ (and promote) increasing numbers of Korean women.

ONE OF THE GUYS
But at the top 400 companies, many of which are family-run conglomerates, it's hard for women to reach the upper ranks. In all, about 8% of working women hold managerial positions. (In the U.S. nearly 51% do.) "We have a long way to go," says Cho Jin Woo, director of the Gender Equality Ministry.

South Koreans are grappling with traditional attitudes about women, a hierarchical business culture, and the need to open up the workplace to compete globally. A senior manager at SK Holdings, which controls the giant mobile phone carrier SK Telecom (SKM), says he avoids hiring women because he believes they lack tenacity. When deadlines are tight, he says, "you need people prepared to put in long hours at the office." Park Myung Soon, a 39-year-old woman who is in charge of business development at the carrier, says, "Many men are preoccupied with the notion that women are a different species." To get ahead, Park says she had to achieve 120% of what her male colleagues did—as well as play basketball and drink with them after work. "Luckily, I like sports, and I like to drink," she says.

When Choi Dong Hee joined SK's research arm in 2005, she was the only woman there and had no major assignment until she created one. After conducting a yearlong study, Choi, 30, proposed changing the company's policy to allow subscribers to use any wireless portal. Her managers ignored her. She persisted. Finally, they agreed to let her brief the division head, who agreed to let her make her case to the company chairman. Choi worked on the presentation for three weeks straight, sometimes alone in the office overnight (to her boss's horror). In the end, the company did adopt the open policy she advocated. Now her managers are quick to say that women's perspectives can help SK better serve its customers.

Sonia Kim, who is in charge of TV marketing at Samsung Electronics, says her male colleagues rarely argue with the boss, even if they think he's wrong. Kim, though, persuaded her manager to let her develop a promotional campaign rather than rely on an ad agency she thought had lost its creative edge. Kim also says some of the men used to overturn decisions made during the day while out drinking after hours. Since she and other women at Samsung complained, Kim says, the practice has mostly stopped.

http://www.businessweek.com/magazine/content/08_16/b4080058309099.htm

◦

Women in South Korea - Cracks in the Glass Ceiling

Elite Korean Schools, Forging Ivy League Skills

It is 10:30 p.m. and students at the elite Daewon prep school here are cramming in a study hall that ends a 15-hour school day. A window is propped open so the evening chill can keep them awake. One teenager studies standing upright at his desk to keep from dozing.

Kim Hyun-kyung, who has accumulated nearly perfect scores on her SATs, is multitasking to prepare for physics, chemistry and history exams.

“I can’t let myself waste even a second,” said Ms. Kim, who dreams of attending Harvard, Yale or another brand-name American college. And she has a good shot. This spring, as in previous years, all but a few of the 133 graduates from Daewon Foreign Language High School who applied to selective American universities won admission.

It is a success rate that American parents may well envy, especially now, as many students are swallowing rejection from favorite universities at the close of an insanely selective college application season.

“Going to U.S. universities has become like a huge fad in Korean society, and the Ivy League names — Harvard, Yale, Princeton — have really struck a nerve,” said Victoria Kim, who attended Daewon and graduated from Harvard last June.

Daewon has one major Korean rival, the Minjok Leadership Academy, three hours’ drive east of Seoul, which also has a spectacular record of admission to Ivy League colleges.

How do they do it? Their formula is relatively simple. They take South Korea’s top-scoring middle school students, put those who aspire to an American university in English-language classes, taught by Korean and highly paid American and other foreign teachers, emphasize composition and other skills crucial to success on the SATs and college admissions essays, and — especially this — urge them on to unceasing study.

Both schools seem to be rethinking their grueling regimen, at least a bit. Minjok, a boarding school, has turned off dormitory surveillance cameras previously used to ensure that students did not doze in late-night study sessions. Daewon is ending its school day earlier for freshmen. Its founder, Lee Won-hee, worried in an interview that while Daewon was turning out high-scoring students, it might be falling short in educating them as responsible citizens.

“American schools may do a better job at that,” Dr. Lee said.

Still, the schools are highly rigorous. Both supplement South Korea’s required, lecture-based national curriculum with Western-style discussion classes. Their academic year is more than a month longer than at American high schools. Daewon, which costs about $5,000 per year to attend, requires two foreign languages besides English. Minjok, where tuition, board and other expenses top $15,000, offers Advanced Placement courses and research projects.

And, oh yes. Both schools suppress teenage romance as a waste of time.

“What are you doing holding hands?” a Daewon administrator scolded an adolescent couple recently, according to his aides. “You should be studying!”

Students do not seem to complain. Park Yeshong, one of Kim Hyun-kyung’s classmates, said attractions tended to fade during hundreds of hours of close-quarters study. “We know each other too well to fall in love,” she said. Many American educators would kill to have such disciplined pupils.

Both schools reserve admission for highly motivated students; the application process resembles that at many American colleges, where students are judged on their grade-point averages, as well as their performance on special tests and in interviews.

“Even my worst students are great,” said Joseph Foster, a Williams College graduate who teaches writing at Daewon. “They’re professionals; if I teach them, they’ll learn it. I get e-mails at 2 a.m. I’ll respond and go to bed. When I get up, I’ll find a follow-up question mailed at 5 a.m.”

South Korea is not the only country sending more students to the United States, but it seems to be a special case. Some 103,000 Korean students study at American schools of all levels, more than from any other country, according to American government statistics. In higher education, only India and China, with populations more than 20 times that of South Korea’s, send more students.

“Preparing to get to the best American universities has become something of a national obsession in Korea,” said Alexander Vershbow, the American ambassador to South Korea.

Korean applications to Harvard alone have tripled, to 213 this spring, up from 66 in 2003, said William R. Fitzsimmons, Harvard’s dean of admissions. Harvard has 37 Korean undergraduates, more than from any foreign country except Canada and Britain. Harvard, Yale and Princeton have a total of 103 Korean undergraduates; 34 graduated from Daewon or Minjok.

This year, Daewon and Minjok graduates are heading to universities like Stanford, Chicago, Duke and seven of the eight Ivy League universities — but not to Harvard. Instead, Harvard accepted four Korean students from three other prep schools.

“That was certainly not any statement” about the Daewon and Minjok schools, Mr. Fitzsimmons said. “We’re alert to getting kids from schools where we haven’t had them before, but we’d never reject an applicant simply because he or she came from a school with a history of sending students to Harvard.”

South Korea’s academic year starts in March, so the 2008 class of Daewon’s Global Leadership Program, which prepares students for study at foreign universities, graduated in February.

One graduate was Kim Soo-yeon, 19, who was accepted by Princeton this month. Daewon parents tend to be wealthy doctors, lawyers or university professors. Ms. Kim’s father is a top official in the Korean Olympic Committee.

Ms. Kim developed fierce study habits early, watching her mother scold her older sister for receiving any score less than 100 on tests. Even a 98 or a 99 brought a tongue-lashing.

“Most Korean mothers want their children to get 100 on all the tests in all the subjects,” Ms. Kim’s mother said.

Ms. Kim’s highest aspiration was to attend a top Korean university, until she read a book by a Korean student at Harvard about American universities. Immediately she put up a sign in her bedroom: “I’m going to an Ivy League!”

Even while at Daewon, Ms. Kim, like thousands of Korean students, took weekend classes in English, physics and other subjects at private academies, raising her SAT scores by hundreds of points. “I just love to do well on the tests,” she said.

As bright as she is, she was just one great student among many, said Eric Cho, Daewon’s college counselor. Sitting at his computer terminal at the school, perched on a craggy eastern hilltop overlooking the Seoul skyline, Mr. Cho scrolled through the class of 2008’s academic records.
Their average combined SAT score was 2203 out of 2400. By comparison, the average combined score at Phillips Exeter, the New Hampshire boarding school, is 2085. Sixty-seven Daewon graduates had perfect 800 math scores.

Kim Hyun-kyung, 17, scored perfect 800s on the SAT verbal and math tests, and 790 in writing. She is scheduled to take nine Advanced Placement tests next month, in calculus, physics, chemistry, European history and five other subjects. One challenge: she has taken none of these courses. Instead, she is teaching herself in between classes at Daewon, buying and devouring textbooks.

So she is busy. She rises at 6 a.m. and heads for her school bus at 6:50. Arriving at Daewon, she grabs a broom to help classmates clean her classroom. Between 8 and noon, she hears Korean instructors teach supply and demand in economics, Korean soils in geography and classical poets in Korean literature.

At lunch she joins other raucous students, all, like her, wearing blue blazers, in a chow line serving beans and rice, fried dumpling and pickled turnip, which she eats with girlfriends. Boys, who sit elsewhere, wolf their food and race to a dirt lot for a 10-minute pickup soccer game before afternoon classes.

Kim Hyun-kyung joins other girls at a hallway sink to brush her teeth before reporting to French literature, French culture and English grammar classes, taught by Korean instructors. At 3:20, her English language classes begin. This day, they include English literature, taught by Mani Tadayon, a polyglot graduate of the University of California at Berkeley who was born in Iran, and government and politics, taught by Hugh Quigley, a former Wall Street lawyer.

Evening study hall begins at 7:45. She piles up textbooks on an adjoining desk, where they glare at her like a to-do list. Classmates sling backpacks over seats, prop a window open and start cramming. Three hours later, the floor is littered with empty juice cartons and water bottles.

One girl has nodded out, head on desk. At 10:50 a tone sounds, and Ms. Kim heads for a bus that will wend its way through Seoul’s towering high-rise canyons to her home, south of the Han River.

“I feel proud that I’ve endured another day,” she said.

The schedule at the Minjok academy, on a rural campus of tile-roofed buildings in forested hills, appears even more daunting. Students rise at 6 for martial arts, and thereafter, wearing full-sleeved, gray-and-black robes, plunge into a day of relentless study that ends just before midnight, when they may sleep.

But most keep cramming until 2 a.m., when dorm lights are switched off, said Gang Min-ho, a senior. Even then some students turn on lanterns and keep going, Mr. Gang said. “Basically we lead very tired lives,” he said.

Students sometimes report for classes so exhausted that Alexander Ganse, a German who teaches European history, said he asked, “Did you go to bed at all last night?”

“But we’re not only nerds!” interrupted Choi Jung-yun, who grew up in San Diego. Minjok students play sports, take part in many clubs and even have a rock band, she said. Ambassador Vershbow, who plays the drums, confirmed that with photographs that showed him jamming with Minjok’s rockers during a visit to the school last year.

There are other hints of slackening. A banner once hung on a Minjok building. “This school is a paradise for those who want to study and a hell for those who do not,” it read. But it was taken down after faculty members deemed it too harsh, said Son Eun-ju, director of counseling.

http://www.nytimes.com/2008/04/27/world/asia/27seoul.html?ex=1209960000&en=f9ba883576c35596&ei=5070&emc=eta1 ◦

Elite Korean Schools, Forging Ivy League Skills

South Korea's First Astronaut Returns

South Korea's first astronaut Yi So-yeon looks on during a news conference in Star City, outside Moscow,Monday, April 21, 2008. A Russian space capsule touched down in Kazakhstan on Saturday after hurtling through Earth's atmosphere in a steeper-than-normal descent, subjecting the three-nation-crew to severe G-forces and landing hundreds of kilometers (miles) off target. Saturday's mission saw the return to Earth of South Korea's first astronaut, Yi So-yeon. She spent 10 days in space before joining U.S. astronaut Peggy Whitson and Russian flight engineer Yuri Malenchenko in the 3 1/2-hour, bone-jarring descent from the international space station.

◦

South Korea's First Astronaut Returns

Bush hosts South Korean president at Camp David

President Bush and South Korean President Lee Myung-bak opened two days of talks on Friday focusing on North Korea's unfulfilled pledge to disclose its nuclear activities and a U.S. free-trade deal with South Korea that faces an uphill battle in Congress.

Bush hopes to strengthen sometimes-shaky U.S.-South Korea ties under Lee, a pro-American conservative who took office in late February and made the United States his first overseas trip. Their get-to-know-you meeting took on renewed importance when South Korea announced Friday that it would lift its ban on U.S. beef imports.

The dinner menu at the secluded presidential retreat in Maryland? Texas black Angus beef tenderloin.

South Korea was the third largest foreign market for U.S. beef before it banned imports in December 2003 over the possibility of mad cow disease. Its decision to end the ban removed a major roadblock to getting Congress to pass the free-trade pact, which Bush wants lawmakers to ratify before he leaves office. But even with the beef spat resolved, opposition from Democrats and automakers and a narrowing legislative calendar could push the issue into the next administration.

On North Korea, Bush is embracing Lee's get-tough rhetoric against its communist neighbor. But the talks between North Korea and the U.S., China, Russia, South Korea and Japan are at an impasse over how the North should make good on its pledge to declare its nuclear and proliferation activities.

Lee is the first South Korean president to be invited to Camp David, and the visit, under picture-perfect blue skies, was evidence of Bush's hope that U.S.-Korean relations will get even stronger under the new leader. Bush and first lady Laura Bush greeted Lee and his wife, Kim Yoon-ok, as they got off a helicopter that ferried them from Washington to the compound.

Bush started to climb into the driver's seat of one of the golf carts that are used to get around Camp David, then asked Lee if he wanted to drive.

"Yeah. Can I drive?" Lee asked, then moved quickly to the driver's side.

"I drive," Lee exclaimed, grabbing the steering wheel with one hand and waving with the other.

As the two drove past the media, Bush joked: "He's afraid of my driving."

The two leaders were to have talks Friday night and then more meetings on Saturday along with a brief press conference. They are expected to herald the beef deal, the culmination of lengthy negotiations.

The South Korean Agriculture Ministry said it will allow U.S. beef imports from cattle younger than 30 months. Younger cows are believed to be less at risk for mad cow disease. South Korea said it would allow beef from older cattle after the U.S. strengthens controls on feed to reduce chances of infection.

But even with that progress, the trade deal could face trouble as U.S. lawmakers, including Democratic presidential candidates Hillary Rodham Clinton and Barack Obama, voice increasingly anti-free trade sentiments.

On Friday, Lee met with Secretary of State Condoleezza Rice and with U.S. trade envoy Susan Schwab, who said the resumption of beef sales means that "safe, affordable, high-quality American beef will soon be back on Korean tables."

But Sen. Max Baucus, D-Mont., chairman the Senate Finance Committee, said he will block consideration of the trade agreement until all cuts of U.S. beef from cattle of all ages are on Korean store shelves.

"Korea must provide full market access for all U.S. beef, and I believe this deal can get us there if the Korean government follows through," Baucus said. "I will closely monitor the implementation of this new import protocol, and I expect great results."

Lee, a former construction chief executive nicknamed "The Bulldozer" for his determination to get things done, has ended a decade of liberal rule in which South Korea sought to embrace the North and refrained from criticism. The relief in Washington has been evident in the Bush administration's praise of Lee's insistence that the North follow through on nuclear pledges before receiving aid from its southern rival.

Bush's meetings with Lee's predecessor, Roh Moo-hyun — elected on an anti-America platform — were often notable for their awkwardness, fueling the perception that the leaders did not like each other. Roh favored a "sunshine" policy that provided aid without demanding concessions from North Korea.

Lee's position on North Korea may turn out to be even tougher than Bush's because the United States is pressing hard for an agreement. Nuclear talks are stalled over whether the North will hand over a promised full declaration of its nuclear programs in return for concessions. The Bush administration apparently has decided that the declaration's exact contents are less important than an assurance that the nuclear negotiators can check up on Kim Jong Il's government to make sure it has told the truth.

http://news.yahoo.com/s/ap/20080419/ap_on_go_pr_wh/us_skorea;_ylt=AhDtdQ.R0L0RLOxwgb91Z0yyFz4D ◦

Bush hosts South Korean president at Camp David

Beef deal buoys US-SK April summit

Buoyed by Seoul's decision to resume US beef imports, President George W. Bush and South Korea's leader Lee Myung-bak hold talks Friday on pushing ahead with a huge free trade deal and fortifying their half-century security alliance.

The meeting will also focus on a multilateral bid to end North Korea's nuclear weapons drive, as the Bush administration appears to be bending backwards to forge an agreement with the hardline communist state.

Eager to have the free trade and nuclear deals implemented before he leaves the White House in January 2009, Bush will welcome Lee at Camp David for the two-day talks, that are to include their economic and defense teams.

Lee is the first South Korean leader to be invited to the rustic presidential retreat.
Although the two have not met before, they share a business background, conservative free market principles and strong Christian values.

Ties between the allies have warmed since Lee took over the helm of the world's 10th biggest economy hardly two months ago.

Relations had deteriorated under Lee's predecessors Roh Moo-Hyun and Kim Dae-jung, both of whose unconditional support for North Korea had raised suspicions in the United States, which has 28,000 troops stationed in South Korea.

On the eve of the Bush-Lee talks, South Korea announced it has agreed to give US beef greater access to its market, giving a fillip to a free trade agreement signed about a year ago but unratified by their legislatures.

Washington wanted full access to the beef market for any ratification.

South Korea banned import of US beef in 2003 due to mad cow fears. It eased the ban in 2006 but effectively halted all imports last October.

"Both sides reached an agreement on gradual expansion of US beef imports," South Korea's Assistant Agriculture Minister Min Dong-Seok said in Seoul.

But US Trade Representative Susan Schwab said in Washington the agreement represented reopening the Korean market "to all US beef and beef products, from cattle of all ages."

She said "the major obstacle" to Congressional consideration of the FTA "is removed.

"The Administration will now work in earnest with Congress and the US agriculture, manufacturing, and services sectors to pass the FTA," Schwab said.

The agreement is the most commercially significant US trade deal in 15 years. The Democratic-led US Congress has been wary of trade deals negotiated by the Bush administration.

At a dinner late Thursday with business leaders, Lee was served US beef from farm-rich Montana.

"The ratification of the South Korea-US free trade agreement constitutes an essential part" of transnational community building, he said.

It would usher in a new era in bilateral security relations, "anchoring the military alliance on a firm social and economic basis," he said.

If ratified, the FTA will add about 20 billion dollars a year to trade between the two nations, said Dennis Wilder, the White House national security director for Asian affairs.

In a bid to mend fences with North Korea, Lee proposed Thursday the creation of the first liaison offices in the capitals of the two Koreas, which are still technically in a state of war after their 1950-1953 bloody clashes.

The offices in Seoul and Pyongyang would act as a permanent communication link, he told The Washington Post newspaper in an interview.

Lee has promised a firmer line on North Korea, linking aid to nuclear disarmament in a move that has angered the hardline communist state.

A furious Pyongyang has threatened to turn its neighbor into "ashes" after kicking South Korean officials out of a joint industrial complex in the North's border city of Kaesong.

Bush and Lee would discuss the latest efforts being made to prod North Korea to disband its nuclear weapons program under an aid-for-denuclearization pact adopted by the United States, China, the two Koreas, Japan and Russia.

In a turnaround Thursday, US Secretary of State Condoleezza Rice hinted that US sanctions against North Korea could be removed even before its nuclear programs or proliferation activities were verified independently.

"Verification can take some time," she told reporters.

North Korea has been pushing the United States to remove it from the blacklist of state sponsors of terrorism.

http://news.yahoo.com/s/afp/20080418/wl_asia_afp/usskoreankoreanuclearweaponstrade;_ylt=Au0Y4W3o5FUp.iCO7otGpCoBxg8F ◦

Beef deal buoys US-SK April summit

10 Major Trends in Korea for 2008

http://www.ikjournal.com/
Samsung Economic Research Institute
Han Chang-Soo

In 2008, under a change in national leadership, Korea is expected to embark on major transitions in almost every sector, from politics to the economy and society. The victory of the conservative Grand National Party (GNP) in the December presidential election means a more pro-business administration for the first time in ten years. The overarching economic principle of the new administration will be "growth" rather than "equality and income distribution" as witnessed in recent years.

The administration hopes to maximize the economy's growth potential and job creation by stimulating corporate investment and market competition. However, political resistance to policy changes on top of ongoing social needs and demands will present a challenge in navigating a change in course.

Trend #1: Shifts in Economic Policy Line: Pro-Growth

Stressing pragmatism, President-elect Lee Myung-Bak wants to shift the economic focus back to growth. It is his goal to advance Korea to leading country status by building on the results of industrialization (in the 1970s) and democratization (in the late 1990s), and fortifying growth engines. "It is now time for Korea to become an advanced nation following its establishment (in 1948), industrialization and democratization. ...I am determined to create new development engines based on creativity," said Lee said in his victory speech.

Lee's administration will break away with the equality- and distribution-centered policy line of the last ten years under the liberal governments and try to "realize welfare through growth." Previous administrations attempted to enhance economic efficiency by implementing structural reforms and by introducing global standards over the past decade, but ended up undermining the Korean economy's vitality and native strengths: brisk corporate investment coupled with diligence a challenging spirit, all of which had driven national economic growth. As a result, the average annual economic growth rate fell from 7.7 percent in the 1980s to 6.3 percent in the 1990s and to 4.4 percent between 1997 and 2007.

The new administration plans to implement a market-orientated policy line to achieve its top economic priorities: higher growth and more jobs. Lee's "747 Public Pledge" during his election campaign calls for an annual average of 7.0 percent economic growth, US$40,000 of per-capita income, and Korea becoming one of the world's top seven economies. Along the way, it is envisioned that three million new jobs will be created during his five-year term.

To this end, his administration will choose pragmatic policy designed to invigorate market functions. It is highly likely that it will strive to recognize certain companies as core growth engines and improve corporate investment through deregulation. Prime targets for deregulation are the limits on the shareholdings of large conglomerates in their subsidiary companies, rules governing merger and acquisition (M&A) and the separation between the financial sector and non-financial actors (i.e., the regulation prohibiting an industrial company from owning a commercial bank).

Trend #2: Job Creation through Support for SMEs

Stronger competitiveness through supporting small and medium-sized enterprises (SMEs) and job creation will be the new administration's bywords. It aims to generate 500,000 jobs by fostering 50,000 innovative SMEs over the next five years. According to the government, innovative SMEs are:

* Venture companies

* The so-called "Innobiz" type of company, that is, government-designated SMEs that have operated for over three years, demonstrated technological prowess and growth potential

* SMEs that have proven themselves to be managerially innovative

Their potential of these two latter types of company to hire workers is estimated to be 2.6 times greater than ordinary SMEs.

SME competitiveness was also a key concern of previous administrations since they account for 88.1 percent (as of 2005) of total employment, according to the Korea Federation of Small and Medium Business.

The "People's Government" under the Kim Dae-Jung administration focused on nurturing venture companies in order to overcome the 1997 financial crisis, while the outgoing "Participatory Government" under President Roh Moo-Hyun introduced its "Comprehensive Measures [relating to technology, workforce, capital and markets] to Strengthen the Competitiveness of SMEs" in 2004, which contrasted with traditional protective policies toward the sector.

The new administration will promote a more advanced "growth stage-based strategy for fostering SMEs" than that of the Participatory government, which tried to nurture such companies simply by providing financial support. Specifically, the new administration will pursue concrete measures tailored to each type of innovative SME. Venture companies will be fostered with a focus on foundation; Innobiz SMEs will be nurtured in such a way to achieve higher growth; and the progress of managerially innovative SMEs will be bolstered through marketing and organizational innovation.

Trend #3: Prolonged Volatility in Financial Markets

The United States and Korean housing markets will weigh heavily on financial markets. In the U.S., the turmoil triggered by the subprime mortgage debacle will last through 2008 as a record number of homeowners face the end of their low introductory lending-rate period and a reset to a higher rate.

This could create a giant wave of foreclosures and crimp vital consumer spending in the U.S. economy. On a bigger scale, banks, forced into huge write-downs because of toxic securitized mortgages, are limiting commercial lending and non-financial concerns are feeling the effects of the housing industry recession on their own earnings.

The turbulence will raise one of the major questions of 2008: will the slowing U.S. economy fall into a recession and, if so, how will the global economy be affected? Jittery investors have been quick to exit stock markets, fearing a global slowdown. Therefore, the volatility of the U.S. stock market (and consequently the Korean stock market) is expected to continue at least several more months.

For example, following the second round of subprime mortgage woes in August 2007, foreigners sold securities on Korean bourses worth 21.9 trillion won in net terms, i.e., 80.5 percent of the securities that were net sold on an annual average in 2007. If the housing slump in Korea continues with an increasing number of unsold new houses and the recent liquidity squeeze persists, more and more nonperforming loans related to real estate are likely. Project financing (PF) loans offered by saving banks may be a case in point. The proportion of saving banks-issued PF loans jumped from 5.7 percent in June 2006 to 14.0 percent in March 2007 and has since remained at the same high level. Should interest rates keep rising and the housing market stays weak, even home-equity loans (largely with adjustable interest rates) are feared to go sour. The value of home-equity loans stood at 283.6 trillion won as of the end of September 2007, 94 percent of which were of the adjustable-rate variety. A one-percentage point increase in interest rates on home-equity loans is anticipated to add 550,000 won annually to the amount each borrower must repay.

Trend #4: Start of a "Big Bang" in the Financial Industry

The introduction of the Capital Market Consolidation Law (due to take effect in February 2009) promises to bring fundamental changes to the financial industry. Securities firms will be permitted to deal with all financial businesses except for banking and insurance businesses. An assortment of financial products will be based on the principle of "negative-listing" (meaning everything will be allowed unless prohibited specifically in the law), bringing down barriers between financial businesses and ushering in unlimited competition across virtually all types of institution within the sector.

Therefore, securities firms looking to expand the scope of their opportunities will likely seek to bulk their capital size through merger and acquisition or by acquiring asset management companies. In terms of the total assets, Korea's top three securities firms currently account for only one one-hundredth of the top three global investment banks. However, after the anticipated wave of such M&As, the domestic securities business will likely augment its weight relative to the financial industry as a whole.

Banks and insurance providers, as well, will make every effort to improve their competitiveness in the run up to the Capital Market Consolidation Law taking effect. It is envisioned that financial holding companies, mostly set up by commercial banks, will acquire or establish securities firms. Those already in possession of securities firms will enlarge departments related to investment banking and recruit more professionals.

Through the Ministry of Finance and Economy (MOFE), the government is also exploring ways to encourage M&A among financial institutions so that they can grow in size and cover operations of a broader scope. For instance, the ministry will provide tax incentives by, say, reducing the tax burden associated with M&As, lift regulations on private equity funds and allow hedge funds to merge with and acquire domestic or foreign financial institutions.

Trend #5: Full-Blown Convergence between Broadcasting and Communications and between Wired and Wireless Communications

SK Telecom's acquisition of Hanaro Telecom (wired telecom provider) from the AIG/Newbridge consortium announced in December 2007 is leading the Korean telecommunication market into a new competitive phase. KT (wired telecom provider) is considering merging with its wireless telecom subsidiary KTF while LG Dacom (wired telecom provider) plans to list its subsidiary LG Powercomm (and Internet service provider) on the Korea Stock Exchange and subsequently merge with it. The government has also developed policy measures to facilitate convergence between broadcasting and communications and between wired and wireless communications by consolidating the number of designated business lines and streamlining regulatory organizations.

For example, the number of business lines was reduced in December 2007 from the previous eight, which included local/long-distance/international calls, Internet access, VoIP (voice over Internet protocol) and telex, down to three, namely transmission, frequency provision and the leasing service of telecommunications circuit facilities

Meanwhile, separate regulatory organizations responsible for communications and broadcasting were integrated into the Committee to Promote Broadcasting/Communications Convergence under the Office of Prime Minister in July 2006. An integrated regulatory organization to govern this matter is expected to emerge later.

As a result of such convergence, the communications industry will develop a new competitive structure. The industry at present is primarily driven by competition among the top three wireless telecom service providers and the top three wired service providers. However, on the assumption that KT and SKT will maintain the dominant positions in the markets for wired and wireless communication services, respectively, the industry will be led by the top two comprehensive (wired plus wireless) service providers (KT and SKT) followed by one smaller provider (LG).

Trend #6: Hypercompetition Boundary Collapse among Markets and Industries

Competition in the future will not be affected by conventional barriers among industries, technologies, distribution and markets. As consumer needs become more complicated and technological barriers lower, some "gray market" companies will emerge. That is, new types of enterprises that are not illegal, but rather defy conventional competition rules and existing market demarcation.

For example, distributors may vie more intensely to secure new distribution channels. Also, in the electronics market, originally separate markets may overlap with one another as digital convergence products are developed. In fact, this phenomenon is already evident. Designer clothes, which were once only handled by specialty stores, are now sold by discount outlets or overseas purchase agents at reasonable prices. Also, the fast growth of satellite-based automobile navigation has prompted multimedia companies to combine their products with global positioning capabilities in order to gain a beachhead in this burgeoning market.

Trend #7: Multicultural and Globalized Families and Society

Korea is expected to welcome progressively more foreigners and foreign cultures. An increasing inflow of foreign workers and immigrants by international marriage brought the number of foreigners residing in Korea above the one-million mark as of August 2007. Over 50 foreign communities across the country exert multicultural influence on Korean society.

The Internet and cable TV facilitate the inflow of foreign cultural content and members of the younger generation increasingly go abroad and to experience other cultures. U.S. and Japanese dramas claim huge, enthusiastic audiences, resulting in the creation of some 1,400 Internet clubs that further increase the viewership of the shows. Moreover, domestic TV shows help familiarize Koreans with foreign culture by increasingly featuring more foreigners and by covering diverse themes. This has even given birth to a new term, "media nomadism," which refers to the phenomenon whereby the media does not stick to conventional forms or traditions, but rather encompasses a variety of cultures.

Trend #8: Shifts in Education Policy Direction Valuing Excellence over Equality

The incoming government plans to trim the size and power of the Ministry of Education and Human Resource Development and merge it with the science and technology ministry. The current egalitarianism-based education policy will be scrapped. Local governments and universities will be given greater autonomy and parents and students will have more options.

More than one hundred new independent private high schools are to be established to encourage competition for higher quality education and dampen the urge to enroll in after-school private academies. Such private high schools do not depend on state subsidies and therefore operate with full autonomy.

On the contentious issue of university admissions policy, universities will likely have more leeway in deciding on how to use the grading system in scoring the national academic achievement examination for university entrance, and how much high school records should be reflected in the admissions system.

In addition, the new administration will establish college systems that will make domestic colleges or universities internationally competitive in research capability. It will lay the groundwork for global research-centered universities by giving financial support toward research according to the research competitiveness of applicant universities. It will consolidate various and scattered R&D related policies of the Ministry of Science and Technology and the Ministry of Education and Human Resources Development and thus enhance the efficiency of R&D budget execution.

Trend #9: National Assembly Elections and Shifts in the Political Landscape

The 18th elections for the National Assembly scheduled for April 9th 2008 are likely to revolve around two key issues: on the one hand, the need of the GNP, the new ruling party, to secure more than half the seats within the legislature; and on the other hand, the need by the opposition to check the power of the same ruling party. At present, the GNP is expected to win a significant number of seats, but perhaps not as many as party leaders hope if voters think more checks and balances are needed in the National Assembly. Any early errors by the new administration, lackluster GNP candidates or doubts about the Lee administration's ability may result in a more mixed political landscape.

Voters in the Seoul metropolitan area will play a decisive role in the elections and consequently in the rearrangement of regionalism in politics. After the local elections of 2006, economic concerns, not regionalism, became the overriding voter concern, ultimately leading to the return of the conservative GNP to power. Unless major changes occur, a new political landscape may emerge characterized by a huge ruling party supported by voters in the Seoul metropolitan area and the Gyeongsang Provinces, plus several smaller parties that draw support from the Jeolla or Chungcheong provinces.

Trend #10: More Moderate Pace of Improvement in the Inter-Korean Relationship

Given the uncertainty about whether North Korea will proceed with its promised denuclearization, the new administration is very likely to insist on this issue as the top priority for better inter-Korean relations. It will focus on "mutual engagement" rather than "unilateral engagement." Thus, any further assistance to the North will be expected to hinge on the North's dismantling of its nuclear program. However, it will likely adopt a flexible support policy toward the North even before denuclearization occurs should there be concrete signs the country is progressing in this direction.

North Korea is currently in denial about its uranium enrichment program and is expected to declare a plutonium stock of less than the internationally suspected 50 kilograms. Even if the North makes an exact declaration about the state of its nuclear program, it is highly unlikely that negotiations on nuclear dismantlement in the second half of 2008 will proceed smoothly. However, considering that the North needs to leave room for negotiations with the next U.S. administration, which will commence in January 2009, it will likely refrain from extreme action such as a second nuclear test. ◦

10 Major Trends in Korea for 2008

A landslide in South Korea - does a new era beckon?

AS VOTING ended in South Korea’s presidential election, exit polls indicated what most in the country had anyway expected: the opposition Grand National Party’s Lee Myung-bak was to be the country’s president. Mr Lee won a thumping endorsement, securing close to 50% of the vote in a 12-man presidential field. Mr Lee’s victory brightens the conservative GNP's prospects of also winning control of the legislature in elections next April.

So ends a decade of liberal rule by Kim Dae-jung and his successor Roh Moo-hyun. South Koreans are disillusioned with Mr Roh, who talked about improving their lot but failed to deliver robust economic growth. His divisive rhetoric angered many. “A president has to bring the country together,” Hyundai's chairman and a legislator, Chung Mong-joon, suggested. “Roh Moo-hyun divided the country.”

Many South Koreans believe that Kim Dae-jung’s “Sunshine Policy’’ of being friendly towards North Korea, which continued under Mr Roh, brought them little in the way of security. Kim Jong Il’s dictatorship developed and tested nuclear bombs despite it. South Koreans suspect that vast amounts of money have been paid to the north in return for summits with the dictator. Mr Lee wants an end to aid if North Korea does not give up its nuclear-weapons programme. He intends to use six-party talks (with China, America, Japan, Russia and North Korea) to put pressure on the north.

Raised in poverty, like many of his 49m countrymen, Mr Lee has an appealing chutzpah. Voters evidently liked the 66-year-old's strong personal story: he overcame malnutrition, paid his own way through university by working as a rubbish collector, and eventually rose to become the boss of ten Hyundai affiliates. His pragmatism helped, too. He is not an old-guard conservative. He was arrested and jailed during his university days. As mayor of Seoul, the capital, he sought to beautify the city. He planted trees, widened pavements, created green public spaces and improved public transport.

Mr Lee’s last election rally was in the centre of Seoul beside the Cheonggyecheon stream. The revival and beautification of the 5.8km waterway through the city became a symbol of his success as mayor. For many voters his ability to graft a consensus among Seoul’s diverse interest groups, to complete the project, augurs well for his time in higher office.

As president Mr Lee says he will slash taxes and ease regulations in order to boost consumer spending. At a news conference the day before the poll he promised a “new era” of economic growth once he takes office in February. He even made specific predictions, suggesting that South Korea’s main stock index will rise to 3,000 one year into his presidency and will be at 5,000 when his five-year term ends. The Kospi closed at 1,861.47 on the day before the election.

If there is a cloud already on the horizon it concerns corruption. Mr Lee sees South Korea’s chaebol (conglomerates) as important allies in reviving the economy. Thus many suspect he will not press prosecutors to investigate alleged bribery and influence peddling at Samsung. Mr Lee, too, is under investigation for his role in an investment scheme that defrauded thousands. He protests that he “has never been involved in scandal as a CEO or as Seoul mayor” and blames his opponents for spreading propaganda against him. By the time Mr Lee is scheduled to take office, he promises, his name will be cleared.

◦

A landslide in South Korea - does a new era beckon?

Ex-Hyundai CEO wins South Korean Presidency

A former Hyundai CEO known as "The Bulldozer" for his determination to get things done rolled over all opposition and financial fraud allegations to win South Korea's presidency Wednesday, ending a decade of liberal rule.

A day after his landslide victory, Lee Myung-bak pledged to work for a nuclear-free Korean peninsula and strengthen Seoul's alliance with the United States.

"The most important thing is for North Korea to get rid of its nuclear weapons," he told a news conference Thursday.

Lee, who turned 66 on election day Wednesday and has also served as the mayor of Seoul, earned his win on a wave of discontent with incumbent President Roh Moo-hyun, whom many believe bungled the economy and dragged down the country's rapid growth.

The National Election Commission said Lee had 48.7 percent of the vote after all ballots were counted. Liberal Chung Dong-young was a distant second with 26.1 percent.

It was the biggest margin of victory in any South Korean presidential election. The candidate with the most votes wins and there are no run-offs. Turnout was a record low 63 percent of 37.7 million eligible voters.

South Koreans apparently wanted change so badly that they were willing to overlook accusations of ethical lapses that dogged Lee throughout his campaign.

Just days before the election, parliament approved an independent counsel investigation into allegations that Lee manipulated stock. The investigation is to be completed before the Feb. 25 inauguration, and Lee has said he will step down if found at fault.

"After all, the people chose the economy over morality," the Maeil Business Newspaper wrote in an editorial for its Thursday editions.

Lee's conservative Grand National Party asked for a veto of the independent counsel bill. "What I'm asking for President Roh to do is veto such legislation before he leaves office for the sake of the national unity," Kang Jae-sup, chairman of the Grand National Party, told KBS radio Thursday.

Presidential spokesman Oh Young-jin responded by saying Roh had earlier expressed his intention to sign the investigation bill.

Lee emphasized the economy in his campaign with a "747" pledge — promising to raise annual growth to 7 percent, double the country's per capita income to $40,000 and lift South Korea to among the world's top seven economies. He also proposed a "Grand Canal" linking Seoul to the southern port city of Busan that would improve transport and be a tourist attraction.

"Today, the people gave me absolute support. I'm well aware of the people's wishes," Lee told supporters at his party's headquarters. "I will serve the people in a very humble way. According to the people's wishes, I will save the nation's economy that faces a crisis."

Lee heads to office amid progress in the long-running standoff over North Korea's nuclear weapons program, fostered by U.S. political and economic concessions to Pyongyang.

The president-elect is expected to tie aid to continued compliance with international demands in the atomic dispute in line with Washington's wishes, but was not expected to make any dramatic change in assistance while the North remains on the path to disarmament.

"The North's abandonment of its nuclear programs is the way for the North to develop" its economy, Lee said in his comments to reporters Thursday.

Lee said he would not shy away from raising the North's shortcomings. "I think unconditionally avoiding criticism toward North Korea would not be appropriate."

On relations with Seoul's key Washington ally, Lee said he would "renew the common values and peace based on trust."

The Bush administration congratulated Lee on his victory, saying it expected close cooperation with his government over the North Korean nuclear dispute.

"We have a long history of cooperation and friendship with South Korea and fully expect that'll continue with this new government," said State Department spokesman Tom Casey.

Hundreds of supporters watching the results on a giant TV in front of the Grand National Party's headquarters burst into song Wednesday evening as Lee's victory became clear.
"I am very happy and it is like retaking democracy after a decade" of liberal rule, said Park Mi-won, a housewife in her 50s.

Lee rose from the poverty that gripped the peninsula after the 1950-53 Korean War and worked as a janitor to put himself through college.

He first gained prominence as head of Hyundai's construction unit, which symbolized South Korea's meteoric economic rise in the 1960-70s. As Seoul's mayor from 2002-2006, he undertook beautification projects in the city that earned him environmental credibility and were viewed as redemption for earlier eyesores he built with Hyundai in the country's haste to develop.

It was during his three decades with the Hyundai Group that Lee earned the nickname "Bulldozer" for his drive to push through challenges. In one instance, he completely took apart a bulldozer to study its mechanism and figure out why it kept breaking down.

"I feel good that the right person was elected. I voted for him because he is an economic president," said Lee Myung-ja, 60, a housewife who was among crowds gathered to watch vote results near a restored stream in central Seoul that was Lee's landmark project as mayor. "I hope President Lee Myung-bak will focus on economic growth so as to make the people better-off."

Taking the luster off Lee's victory were lingering allegations of involvement in a stock manipulation case in which a former business associate faces criminal charges for illegal gains of millions of dollars. A video released Sunday by his liberal rivals showed Lee saying in 2000 that he founded the firm at the center of the case.

Lee has said the taped comments were taken out of context and denied the allegations, but consented to the independent counsel to clear his name. He is the country's first president-elect to face a criminal probe.

By South Korean law, a president-elect can be prosecuted but he would receive immunity from most criminal lawsuits after inauguration.

http://news.yahoo.com/s/ap/20071220/ap_on_re_as/skorea_presidential_election_40

◦

Ex-Hyundai CEO wins South Korean Presidency

Chinese imports of TVs, videos unveiling world to N. Koreans

By Blaine Harden
The Washington Post

SEOUL, South Korea — Cheap Chinese TV sets and video players, together with pirated videotapes and DVDs, are lifting the lid on information reaching the North Korean people, according to defectors and experts on Kim Jong-Il's dictatorship.

The unsealing process — underway for nearly a decade and accelerating this year — coincides with the crumbling of North Korea's centralized economy and the rise of street markets.
In those markets, doing business daily nearly everywhere in the North, are cut-rate electronics and knockoff videos that have acquainted a sizable number of North Koreans with the wealth and razzmatazz of the capitalist world.

Watching South Korean soap operas and Hollywood movies inside North Korea, defectors say, is scary, exhilarating and depressing.

"We closed the drapes and turned the volume down low whenever we watched the James Bond videos," said a North Korean woman, who two years ago fled her fishing town in a boat with her husband and son. "Those movies were how I started to learn what is going on in the world, how people learned the government of Kim Jong-Il is not really for their own good."

The woman, 40, who now lives in a Seoul suburb and did not want her name published because her parents are still in the North, said Chinese consumer electronics began to trickle into her coastal region in the mid-1990s, when massive crop failures and widespread famine forced the government to tolerate private trading.

By 2002, when Kim officially approved limited market reforms, she said, she and her neighbors could sell fish for cash. She used that cash to buy, among other manufactured goods from China, a color television and a videotape player.

In addition to Bond movies, she said, she learned about the world beyond North Korea from Hong Kong gangster films and from South Korean television, which she could receive on her Chinese-made TV.

Her son, now 17, said his understanding of the United States — where he hopes one day to live — was formed by watching old videos of "Charlie's Angels." ◦

Chinese imports of TVs, videos unveiling world to N. Koreans

Why Korea has a Bright Future

by Jeremy Siegel, Ph.D.

My 14-hour Korean Air flight on a non-stop Boeing 747 airliner from New York to Seoul took the polar route over Siberia and China right towards the South Korean capital. But when the plane approached North Korea, it turned sharply east to the Yellow Sea and then hugged the coast before veering west to land at Incheon, the sparkling new airport completed in 2001, a year before Korea hosted the World Cup.

The detour is mandated by North Korea which does not allow South Korean aircraft over their airspace, a restriction that adds nearly an hour to the flight. The north-south division has been a central feature of Korea over the past half century, influencing its politics and economics. But the country is now looking forward, seeking its place in Asia’s future amid the growing economic power of China.

I was invited to Seoul by Mr. Park Hyeon-Joo, Founder and Chairman of the Mirae Asset Group, one of Korea’s fastest growing financial companies. The firm was one of the sponsors of a conference honoring the 20th anniversary of the National Pension Service, Korea’s social security system. Korea, in contrast to the US, invests some of its massive $250 billion trust fund in equities and was considering the advantages of an even higher allocation.

An Asian Economic Success
South Korea is enormously successful. Its per capita income is more than 60% of that of the US, up from only 8% in the early 1960s. Seoul is the second most populated metropolitan area in the world (behind Tokyo), with over 22,000,000 residents. It is a modern Asian metropolis with little sign of poverty.

The country has come a long way from the 1998 Asian crisis that spread from South Asia to Korea. At the height of the crisis, the South Korea’s market index, the KOSPI, fell 74% from 1150 to 277. But lately the market has been surging and in October the index surpassed 2000 and Korean stocks now have a market value over $1 trillion.

Despite the recent bull market, the valuation of Korea’s stock market is still quite compelling. The KOSPI index is selling at only 15.5 times this year’s earnings, a valuation that compares favorably with 19 time earnings in Indonesia, 24 in India, and the 50s for the booming Chinese stock market.

Investors looking to invest in the country can buy the iShares MSCI South Korea Index ETF (EWY), which trades on the New York Stock Exchange.

The Korean won is also strong, rising from 2000 to the dollar at the height of the crisis to 900 today, about the same rate it was before the Asian turmoil began. In dollar terms, the Korean stock market has increased more than ten-fold over the past decade.

But despite this recovery, the country is at a crossroads. It is aging more rapidly than the US, and its fertility rate of 1.2 rivals Japan as one of the lowest in the world. Geopolitical risks abound as the division between the North and the South hangs over the country.

Koreans constantly debate the pros and cons of an eventual merger with the North. They are acutely aware of the cost that West Germany incurred in the absorption of East Germany. They rightfully argue that if the South absorbed the North, the cost to South Korea would be greater since North Korea is so much poorer than East Germany was when the Berlin Wall fell. Yet many feel that eventually the two countries will be united.

But there are more immediate challenges. Korea’s manufacturing is being squeezed by cheap labor from China and its electronics giant, Samsung, has been floundering of late. Increased competition is everywhere. For example, the Koreans once dominated the computer game market in China, but are now feeling stiff competition from the Chinese themselves.

Blueprint for the Future
Mr. Park, the far-sighted chairman of Mirae Asset Management, believes that Seoul can make its mark in financial services and become the financial center of East Asia. The financial industry is growing and clearly has an important place in Korea’s future. But to insure future growth Seoul would have to reduce regulation and foster an innovative and dynamic image. Today there are far too many restrictions on short selling, hedge funds, and its financial institutions are small by today’s international standards.

Yet Korea has some decided advantages. Its people are highly educated and the country sends more students to the US than any other Asian nation, including China and India. Recent political trends have turned more conservative and economic growth is being giving top priority. The five year rule of Roh Moo-hyun, a populist who promised to redress the inequalities of wealth and break up monopolies, has not been successful. As a result, Lee Myung-bak, the former Hyundai executive and mayor of Seoul, enjoys a strong lead in the polls for the upcoming presidential election.

A pro-business government is important, but Korea must do more. To achieve economic success, Seoul must retain its foreign-educated students and entice others to make their mark in Korea. Mr. Park’s presentation at the conference emphasized the importance of being a magnet for top talent. His slides showed the vibrant and colorful skyline of Pudong area of Shanghai and compared it to the clean, white, but uninteresting skyline of Seoul.

He is right: Seoul, like other Asian capitals, must compete with Hong Kong, Singapore, Shanghai, and others cities to attract the best people. We Americans should also not become complacent, as many rightfully claim that the world’s financial center is moving from New York to London and the Far East. All cities now compete in the global marketplace.

Korea’s greatest resource is its people as it has a highly educated and motivated workforce. The country rose from poverty to become one of the richest nations in Asia in a few short decades. As long as it stays focused on the future, I see no reasons why Korea cannot continue to be a leader in Asia. ◦

Why Korea has a Bright Future

Status of U.S. Military Bases in Korea

The transfer of U.S. military bases to the South Koreans is on track and going smoothly, U.S. officials said as Defense Secretary Robert Gates and his top military leaders gathered Tuesday for two days of meetings with their Seoul counterparts here.

So far, 23 of the U.S. camps — vestiges of the 1950-53 Korean War — have been transferred as part of a broader plan to have Seoul assume more responsibility for its own defenses and take over its own wartime command by 2012.

While some South Koreans, including a few protesters who met Gates upon his arrival, would like to see the transfer sooner, both sides have agreed that it would take until 2012 to get all of the needed equipment and training in place.

Senior U.S. defense officials traveling with Gates said this week that the South is not yet prepared for the transfer, but is on pace to be ready by 2012.

Still, just 50 kilometers north of here, the guarded, barbed-wire fence — the DMZ — still divides the country from its northern neighbor. Adm. Mike Mullen, chairman of the Joint Chiefs of Staff, visited the border Monday, after he arrived for the defense meetings.

The developments in the North are also a likely topic for the defense officials.

Just this week, north of that DMZ, North Korea began its long-demanded work to disable its nuclear facility at Yongbyon. The move is a result of the six-nation talks, and would be the most significant step the communist country has taken to scale back its nuclear program.

North Korea conducted its first nuclear test in October of last year.

The North has promised to disable the reactor at Yongbyon by the end of the year in exchange for energy aid and other political concessions from the other five nations: the U.S., China, Japan, South Korea and Russia. One of those concessions that has sparked some debate is the possibility that North Korea could eventually be taken off the U.S. list of states that sponsor terrorism.

Removal from the list has long been a goal of Pyongyang, but the North would have to meet requirements stipulated under U.S. law.

Gates said Tuesday that the meetings in Seoul will largely focus on the progress of the military transition here from U.S. to South Korea.

About 29,000 U.S. troops are still deployed in the South as a legacy of the Korean War, which ended in a cease-fire that has never been replaced by a peace treaty. Under the current military arrangements, the U.S. commander, currently U.S. Army Gen. B.B. Bell, would lead all allied forces under a joint command in the event of a renewed conflict.

Another likely topic for the defense officials is the continued deployment of South Korean troops in Iraq. There is a plan to cut the current number — 1,200 — in half and extend the deployment for another year. South Korean President Roh Moo-hyun has said the extension would boost his country's alliance with the U.S., but others in the country are opposed.

◦

Status of U.S. Military Bases in Korea

Korean men still lag behind female golfers

orlandosentinel.com/sports/golf/orl-andrew1107jul11,0,5905170.column

OrlandoSentinel.com
Korean men still lag behind female golfers
Andrew Carter
July 11, 2007

The revolution began, best anyone can remember, late on a summer night some eight years ago. It was actually early morning by then, local Korean time, when a 20-year-old Korean named Se Ri Pak won the 1998 U.S. Women's Open in Kohler, Wis.

From half the world away, in Pak's homeland, little girls sat in front of televisions, ignoring the need for sleep in the wee hours and dreamt of what it might be like to be Pak. And Korean fathers, too, looked upon their daughters and wondered if they might possess an untapped golf gene."

I picked up a golf club because of her," said In-Bee Park, a Korean who was 10 years old when she stayed up all hours that summer night in '98. "The year she won [the Women's Open], that's when I started playing golf."Park, a rookie on the LPGA Tour, finished tied for fourth a couple of weeks ago in the most recent Women's Open. Years ago, she was one of countless Korean girls whom Pak inspired to play golf, and Park is now one of 45 Korean-born women on the LPGA Tour.

It's no secret, of course, that Pak's influence on the LPGA Tour has been monumental. There are 42 more Korean-born players on the women's tour than there were during her rookie season in '98. Pak, only 29, qualified earlier this season for the LPGA Tour Hall of Fame, and her accomplishments have made the ever-growing Korean presence on the women's tour easy to explain.

What's far more difficult to explain, though, is the absence of a similar Korean presence on the PGA Tour. K.J. Choi, the first Korean-born golfer to compete on the men's tour, walked off No. 18 on Sunday at Congressional Country Club in Maryland, and for the second time in six weeks, he was a champion. He won the Memorial Tournament in early June.

After another victory ended on Sunday, someone asked him whether he was "bigger" in his homeland than Pak. And to that, Choi said, "I think we're both, Se Ri and I, walking a similar path right now. You can't really compare the two of us -- who is better, who is more popular. You can't really say that."

I think what she has done on the LPGA Tour is tremendous. . . . She was a pioneer on the LPGA Tour."She was, indeed. But why has Pak's deep and wide mark on golf failed to leave an imprint on the men's game? Why are there so many Koreans on the LPGA Tour and so few on the PGA Tour?

Among the 45 Koreans on the LPGA Tour this season are 14 rookies. The total number of Koreans has risen steadily since Pak's American breakthrough almost a decade ago.Yet Korean representation on the PGA Tour has remained stagnant since Choi's rookie season in 2000, and he has but only three fellow countrymen on tour now.

Michael Yim, Choi's agent, tried to explain on Tuesday why the numbers are the way they are."There are many differences," he said, speaking of the men's and women's game. "You can't really pinpoint the one specific reason."

Then Yim, who is Korean himself, listed his theories -- how Korean women face an easier road to qualify for the LPGA Tour than men do when trying to reach the PGA Tour. How Korean men must serve in the military, which Choi did after he graduated high school. Yim said Korean families -- though fast becoming more westernized -- still are old-fashioned and rely on men to be primary providers, and that women are able to take more chances with their futures."

When [men] try to make the move from Korea to the U.S., it's not only them that they have to worry about," Yim said. "They have to worry about bringing the whole family over -- and what if you don't make it?"Just the fact that you have to worry about the whole family acts as a deterrent."

And there's another reason, too, maybe most obvious, for the wide gap in gender representation: physique."When you look at it from a physical point of view -- the western guys are a lot more physically developed, and they have a physical advantage over Asian guys," Yim said. "Whereas with the women, the physical side doesn't really [matter] as much."

It's not to say, of course, that Koreans on the LPGA Tour aren't without unique challenges, perhaps none more daunting than adapting to American culture.

"You have to quit all the Korean stuff," Park said. "Korean [TV], Korean movies. When I first came to America, I had to quit all those Korean things."

As he was making his way through another victory on Sunday, one of Choi's fans held up a sign that made reference to his nickname, which is "Tank."

"Move forward just like a tank," he said later. "Just progress. It's how I felt when I first came over to the U.S. starting out . . . There were a lot of hurdles for me to overcome."And so far, at least in the men's game, he's one of the few Koreans who have had to endure. For a while, Pak began a revolution in women's golf. The men's game still is awaiting when a similar one might come, if ever.

◦

Korean men still lag behind female golfers

Korea's New School of Thought on Education

http://www.businessweek.com/print/magazine/content/07_27/b4041054.htm?chan=gl

Korea's New School Of Thought
As growth cools, the nation looks for an education model that spurs innovation

It's 10 a.m. on a school day, and seventh grader Ku Do Hyun is reading an English translation of Aesops classic fable The Goat and the Goatherd. Ku is a student at the Peace Flower School, a private boarding school in Jecheon, a town in the mountains of central Korea. The place is decidedly laid-backno uniforms, no jarring bells heralding the beginning of class, and no late-night cramming. For an exercise in holistic learning called Tongjon, Ku decided to study goats—an endeavor that involved biology, reading assignments, star-gazing at the constellation Capricorn, and a field trip to a local farm to observe the animals. "I'm happy here because I do what I want to do," says the lanky 12-year-old.

At about the same time, 110 miles away in the port city of Incheon, 13-year-old Moon Sang Hyun is committing to memory the formula for a metal alloy and the date of a 14th century Korean coup. If the eighth grader cant recite what he learned in his last algebra class, hell be caned by his teacher as his 40 classmates look on. School lets out at 3 p.m., but the uniformed Moon barely has time for a quick dinner before hopping the bus to a private cram school, where for five hours hell be force-fed English grammar, chemistry, and a host of other subjects. "I'm lucky to go home before midnight, he says with a shrug. "Some of my friends study till 1 or 2 in the morning."

Two students, two very different schools. And those varying approaches to learning are the focus of a debate in South Korea about which better serves todays knowledge-driven economy. Rote learning and cramming, however inhumane, are credited with transforming a poor, mostly agrarian nation into a manufacturing powerhouse in the space of just three decades. The country of 48 million now ranks 11th among the worlds economies and is a top exporter of everything from steel and ships to cell phones and computer chips. It spends 7.5% of its gross domestic product on education, a bigger share than any other industrialized country, and that figure doesnt even include the $38 billion a year Korean parents shell out for after-school cram sessions.

But as growth has cooled to 5% annually over the past decade, from an average rate of nearly 8% during the prior 30 years, some experts are griping that Koreas educational system no longer makes the grade. Everyone from policy wonks to executives at Samsung Group and other top Korean companies complains that the system discourages creative thinking and stifles innovation. "Schools castrate the innate desire of students to satisfy intellectual curiosity," laments Yi Jong Tae, head of the private think tank Korean Education Research Institute. Says Chung Un Chan, economics professor at Seoul National University: "The key to resolving our economic problems lies in a radical reform of our education."

In the meantime, Korea risks losing some of its best and brightest. The number of the country's students enrolled in foreign schools and universities rose to 214,000 in 2005, from 109,000 in 1998, the Korea National Statistical Office says. "Frustrated Koreans are voting with their feet against the educational system," says Hongik University economist Jun Sung In. Their top destination is the U.S.: In the 2005-06 academic year, 58,847 Koreans attended American universities, according to New Yorks Institute of International Education. That's up 10.3% from the previous year. Only India and Chinawith populations at least 20 times greater than Korea's send more students to the U.S.The danger is that many will leave for good. "If I went back to Korea, it would be like starting all over," says Yang Soo In, a 32-year-old Korean who received a masters degree from Columbia Universitys graduate school of architecture in 2005 and decided not to return home. "I've already established good contacts and a network of people here."

Nearly half of all Koreans who earned PhDs in science and technology from U.S. institutions between 2000 and 2003 remained in the U.S., up from 20% in 1992-95, reports the Hyundai Research Institute, a think tank in Seoul. "Brain drain is accelerating as our educational system can't keep up with changes in the business environment," says Yu Byoung Gyu, a senior research fellow at the institute.The swelling discontent has touched off a political debate. In May, Lee Ju Ho, a lawmaker from a leading opposition party, introduced legislation calling for a presidential commission to overhaul the school system. "The first step must be the end of government control over curriculum," says Lee. "The Ministry of Education and Human Resources must be disbanded in favor of a much slimmed-down department focused on lifetime learning."

Dissatisfied families are searching for their own solutions. "Parents got fed up with the official system," says Hyun Byung Ho, publisher of an education magazine called Mindle. Around 4,000 students are enrolled in about 70 alternative schools such as Peace Flower. The first Peace Flower opened near Seoul in 2003; today the group runs four schools with a total of 205 students. "We simply couldnt let our children fall victim to the regimentation of the state schools, says Kim Kyeong Sik, a college instructor and father of two boys, who was one of the schools founders. I hope our school will serve as a stepping stone toward major educational reform in our country. ◦

Korea's New School of Thought on Education

A Capitalist Toehold in North Korea

Despite U.S. tariffs, more South Korean businesses are setting up shop in the North

From afar, the North Korean special economic zone of Kaesong looks like a Cold War relic. Getting there from Seoul takes you down a highway with tank traps set into the pavement, past checkpoints manned by machine-gun-toting guards, and through the demilitarized zone in a corridor flanked by barbed-wire-topped fences. Finally, you reach the barren boulevards and hulking buildings of the zone itself.

But take a closer look and you'll find the place is humming. The 23 South Korean companies operating there employ some 15,000 North Korean workers—double the number of just a year ago. In March, Kaesong's factories churned out $13 million worth of goods, up from $200,000 in January, 2005. An additional 47 South Korean companies are preparing to set up shop there, while Seoul in June is expected to give as many as 300 more the all-clear to move in. Within three years, Kaesong could employ as many as 100,000 workers. "Our Kaesong plant is more efficient and competitive than any factory in China, Vietnam, or anywhere in the world," says Park Sung Chul, chief executive of apparel maker Shinwon, which employs 900 workers in the zone who churn out 60,000 shirts, skirts, and other garments per month.

There's one place, though, where the competitiveness of Kaesong's factories doesn't count for much: Washington. Hardliners take a dim view of the project, arguing that the hard currency it generates for Pyongyang only perpetuates the rogue regime of dictator Kim Jong Il. U.S.-led pressure on Pyongyang to give up its nuclear arms program forced Seoul to slow its investment in Kaesong. That resulted in a two-year delay in the project, conceived during a thaw in North-South relations in 1998 and finally opened in 2004. Under the Trading with the Enemy Act, North Korean exports to the U.S.—including those from Kaesong—are severly restricted. They face tariffs of up to 90%, while most goods from South Korea will be eligible for duty-free entry once a free-trade agreement reached in April is ratified. "If we could start shipments [to the U.S.], the operation here would increase tenfold," says Park, whose company makes more than 40% of its $372 million in annual sales to U.S. customers such as Wal-Mart (WMT ), Gap (GPS ), and Target (TGT ).

Washington's opposition could be a big problem since Seoul has a lot riding on Kaesong's success. The South hopes the zone will give it an economic boost as the country finds itself squeezed between high-tech Japan and low-cost China. The park's North Korean workers—mostly women who are prescreened by bureaucrats in Pyongyang and bused in daily from neighboring towns—earn $57.50 a month regardless of their job or experience. That's roughly a third of what a Chinese factory worker makes, and it hasn't increased since Kaesong opened for business.

INTEGRATION
There's more than simple economics to the South's interest in Kaesong. Seoul sees the industrial park as a first step toward integration of the Korean peninsula. Powered by Kaesong, two-way trade between North and South Korea jumped 43%, to $350 million, in the first four months of this year. The South has already poured some $230 million into the project and expects to invest several times that over the next decade. If things pan out, within 10 years Kaesong will develop into an economic showcase with more than 500,000 North Koreans working in a bustling boom town—helping to spur reforms in the North. "There will be lots of hurdles," says Lee Young Hoon, an economist at the Bank of Korea, the South's central bank. "But given the economic benefits, the Kaesong project has great potential for coaxing Pyongyang out of its shell."


http://www.businessweek.com/magazine/content/07_24/b4038061.htm

◦

A Capitalist Toehold in North Korea

Would Einstein Buy a Hyundai? (TV commercial)

◦

Would Einstein Buy a Hyundai? (TV commercial)