| President Park Geun-hye asked heads of Korea`s top conglomerates to increase investment and employment during a luncheon meeting with them at her office Cheong Wa Dae on Wednesday. Although some criticize the old-fashion way in which the president seemed to have "summoned" the entrepreneurs to her office, it is meaningful for her to have a direct conversation with business leaders at a time of a slumping economy. Most of those present at the meeting made policy recommendations regarding their conglomerates` specific issues, while the president responded to each of the recommendations and instructed senior government officials, including the finance minister, to review them.
President Park promised to ensure that the so-called "economic democratization" campaign will not turn into repression of conglomerates or excessive regulation. She also pledged that her administration will conduct a careful review of a government-proposed revision of the Commercial Act in consideration of business concerns. The business leaders, including Samsung Group Chairman Lee Kun-hee and Hyundai Automotive Group Chairman Chung Mong-koo, promised to increase investment and hiring. It is encouraging that the president and the business chiefs agreed on the need to reinvigorate corporate investment. However, not a few such meetings ended up being a mere "lip service" for Cheong Wa Dae meetings in the past. The promises will be meaningful only when they lead to concrete action.
The business community is very concerned about a series of regulatory legislations and administrative measures adopted by the government and the political circles. Such business resistance reflect corporate selfishness to a certain extent. However, it is true that there have been plenty of bills and policies that neglected business realities. The government and the political circles should present practical solutions by checking what discourages companies from making investments. It is necessary to enhance transparency in corporate activities. Such moves would result in more losses than gains if they are made at the expense of corporate competitiveness or discourage entrepreneurs.
According to a government tally, the country`s top-30 conglomerates plan to invest a total of 154.7 trillion won (138.6 billion U.S. dollars) and hire 147,000 workers, higher than their initial plans announced at the beginning of this year. However, the 30 conglomerate actually invested just 138 trillion won (123.7 billion dollars) last year out of their promised 151 trillion won (135.3 billion dollars). Companies may put some planned investments on hold when the business situation falls short of their expectations. Still, if they continue to inflate their investment projections, the public would increasingly distrust them. The local business community can speak up against moves to excessively restrict their activities but should keep their investment and employment promises.