A new era of governance in South Korea has vowed to reform the long history of family-run conglomerates that control a majority of the country’s economy.
Newly sworn in President Moon Jae-in appointed Kim Sang-jo, nicknamed the ‘chaebol sniper’, as his chief of Fair Trade Commission. Kim has been a long time advocate for reformation of chaebol businesses and levelling out an even playing field to grow the economy.
Moon said his decision to appoint Kim is to keep his office to his pledge of creating jobs and separating ties between big corporations and the government. Kim’s appointment still requires approval, though ahead of confirmation, big businesses are already starting to scramble to make nice in order to stay out of the crossfire.
Earlier in the year, President Park Guen-hye was impeached following 17 weeks of public protest and currently being trialled on 18 counts of bribery and extortion. Park is currently serving time in Seoul Detention Centre.
Park was closely associated with the financial scandal that plagued Samsung all of 2016, which indicted 30 people, including heir Lee Jae Yong. According to the prosecutor in charge of probe, Park accepted bribes from Samsung in exchange for business favours.
Four main chaebol businesses influence the economy of South Korea — Samsung, LG, SK and Hyundai Motor. While these four companies combined placed the country into the ranks of one of Asia’s strongest economies, their collusion with the government, lack of transparency and nepotism are factors driving criticism and discontent among citizens.
Moon has yet to release his strategy and plan for reforming the government, but the cabinet will definitely see a mix of conservative, moderate and liberal politicians as well as revisions in business ethics, laws and tax codes.
President Moon said during his inauguration speech that his priority is to create jobs and lift the shadow that casts over South Koreans by conglomerates. According to analysts, creating 810,000 jobs during his time in office will be a tall order, especially in a time when the people are not trusting of the government.
In South Korea, there’s the tedious work of assessing the workforce, which includes irregular workers who are often undocumented, under paid and relinquished after two years of service without confirmation. Affected areas outside of manufacturing and export is retail. Under Moon’s tutelage, he plans on merging several sectors, including retail and entertainment.
Shopping malls will face a more stringent vetting and approval process before it can be developed and new regulations regulating working hours may be implemented. If so, shopping malls will have to close for two business days out of a month and work with smaller retailers than big brands.