Headlines, September 19, 2018

Wednesday, September 19, 2018

A study of Korean jaebeol business conglomerates

Chairman Lee Kun-hee of Samsung Group accompanies President Moon to Pyongyang

By Vice President Park Byung-wook with Reporter Sua Kim

This is the third installment in a series articles on leading business conglomerates in Korea and around the world covered by the writer, a specialist in the business world in Korea and outside the world. Park was formerly the director of the Business Bureau of The Korea Times, a leading independent English daily in Korea. Park joined The Korea Post media in 2003, which now own and operate 3 English and 2 Korean-language media outlets since 1985. Vice President Park is assisted by Reporter Ms. Sua Kim.—Ed.

President Moon Jae-in poses with Vice Chairman Lee Jae-yong of Samsung Group

Vice Chairman Lee Jae-yong (better known as Jay Y. Lee in the West) accompanied President Moon Jae-in during Moon’s visit to Pyongyang on the occasion of the 3^rd Inter-Korean Summit Meeting in Pyongyang on July 18-20, 2018. Moon was accompanied also by the leaders of three other jaebeol business groups, e.g., Hyundai, SK, LG, and the heads of four major business-related associations.

Deputy Prime Minister Ri Ryong Nam of North Korea (right) receives Korean busienss leaders visiting Pyongyang accompanying President Moon Jae-in on Sept. 18-20, 2018. On the right, foreground, is Vice Chairman Lee Jae-yong of Samsung Electronics shaking shakes hands with Ri followed by other Korean jaebeol busienss leaders.

This is considered a very welcome development in the government-business relations in Korea following the birth of the Moon government on May 11, 2017. This is because it is construed in the Korean society, notably in the business world, as a sign of an end to the period of Jaebeol-taming which all but invariably followed the change of government in Korea—from Park Geun-hye to Moon, Lee Myung-bak to Park, Roh Moo-hyun to Lee MB, and almost all their predecessors.On this situation, the majority of the Korean people, especially those who want continued economic development and growth of Korea, take sides with the businesses because they view them as the main source of economic development and growth of the country.

Korean businesses, especially Samsung, perform the role of a dependable locomotive in helping the government leaders explore and develop diplomatic relations economic cooperation with other countries.

‘Samsung Store Co., Ltd.’ (name of sign) was the name of the original company of today’s Samsung Business Group established during the Japanese Occupation Era of the Korean peninsula in 1938.

On July 9, 2018, Vice Chairman Lee Jae-yong played a pivotal role in the promotion of understanding and friendship between President Moon Jae-in and Prime Minister Narendra Mobi of India. At a meeting with President Moon, Prime Minister Mobi had very high remarks for Samsung. He said: “South Korean tech giant Samsung's largest global mobile factory in Noida will not only generate more jobs but also make India a global export hub.”

(For further details, visit: http://www.koreapost.com/news/articleView.html?idxno=7573)

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Round-up of important news from major Korean dailies today

And from international media:

The Korea Post media (www.koreapost.com) in English, (www.koreapost.co.kr) in Korean.

N. Korea says leaders 'highly appreciate' current state of inter-Korean relations

North Korea's state media reported Wednesday on the third inter-Korean summit under way in Pyongyang, saying that the leaders of the two Koreas "highly appreciated" the current state of cross-border relations during their talks. South Korean President Moon Jae-in visited Pyongyang on Tuesday for a three-day stay for his third summit with North Korean leader Kim Jong-un. They held talks for about two hours, which will be followed by another round Wednesday.

“Korean companies are welcome to infrastructure, high-tech, renewable energy, other areas”

Korean companies are encouraged to move into Viet Nam and make investment in infrastructure, high-technology industries and renewable energy. This was immediately apparent at a recent interview conducted with Ambassador Nguyen Vu Tu of of Viet Nam in Seoul for publication in the five news outlets of Korea Post on the occasion of the Independence Day of Viet Nam on Sept. 3, 2018. The Korea Post media, established 33 years ago in 1985 now own and operate 3 English and 2 Korean news media outlets.

‘We keep high-level contact with Korea, work intensively in EU-ROK context’

Ambassador Milan Lajciak of the Slovak Republic in Seoul said, “This year we will celebrate 25 years of our diplomatic relations. Through this period, we have proved to establish very stable ground of mutually advantageous cooperation and friendly relationship.” Speaking at a recent interview with The Korea Post media (owner and operator of 3 English, 2 Korean news publications) on the occasion of the Day of the Constitution of the Day of the Slovak Republic on Sept. 1 this year, Ambassador Lajciak said, “We have been keeping high-level contacts and working dialogue, we coordinate our interests on international arena, and we work very intensively in the EU-ROK context as well as in V4+ROK format.”

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KBS (http://world.kbs.co.kr/english/news/)

Moon, Kim to Meet Again on Day 2 of Historic Summit

South Korean President Moon Jae-in and North Korean leader Kim Jong-un will hold a second round of summit talks on Wednesday to discuss inter-Korean relations and the North's denuclearization. The two leaders will again sit down for talks at the headquarters of the Central Committee of the Workers' Party in Pyongyang. If the dialogue proceeds well, Moon and Kim are expected to explain the results of the talks in a joint news conference.

UN Security Council to Hold Ministerial Meeting on N. Korea Next Week

The UN Security Council will hold a minister-level meeting next week to discuss North Korea's denuclearization and sanctions. U.S. State Department spokeswoman Heather Nauert said during a news briefing on Tuesday that foreign ministers of the 15 Security Council members will hold the meeting next Thursday at the UN headquarters in New York. The U.S. is known to have convened the meeting, which will be chaired by U.S. Secretary of State Mike Pompeo.

US Hopes for Meaningful, Verifiable Steps toward N. Korea's Denuclearization

The U.S. said Tuesday that it hopes to see meaningful and verifiable steps toward the dismantlement of North Korea's nuclear weapons program through the ongoing inter-Korean summit in Pyongyang. U.S. State Department spokeswoman Heather Nauert said during a news briefing that the summit between South Korean President Moon Jae-in and North Korean leader Kim Jong-un is a "historic opportunity" for Kim to follow through on the denuclearization commitments he made previously.

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Yonhap (http://english.yonhapnews.co.kr)

U.S. finalizes anti-dumping duties on S. Korean PET resin

The United States Department of Commerce has set anti-dumping duties on polyethylene terephthalate (PET) resin from South Korea and four other nations, its website showed Wednesday. The commerce department said PET resin products imported from South Korea, Brazil, Indonesia, Pakistan and Taiwan were sold at "less than fair value rates" in the U.S. market, finalizing anti-dumping tariffs ranging from 5.16 percent to 275.89 percent. Under the decision, South Korean exporters will be assessed duties of 8.23-101.41 percent on PET resin sold in the U.S. market.

Ministry denies Seoul and Washington's push for OPCON transfer with specific date in mind

South Korea's defense ministry on Wednesday dismissed a claim that Seoul and Washington have been pushing for the transfer of wartime operational control (OPCON) with a specific timeline in mind. During a presentation at a security forum, Yeo Suk-joo, deputy minister for policy, said that the Moon Jae-in government's position is to push for the transfer by securing needed defense capabilities at an early date. "The principle of the early, conditions-based transfer of wartime operational control does not mean that we will advance the date for the handover when our military has yet to secure capabilities," Yeo said.

Cigarette sales down 1.1 pct on campaign, higher prices

Sales of cigarettes in South Korea declined 1.1 percent in the first eight months of 2018 from a year earlier due to a government-led anti-smoking campaign and higher prices, data showed Wednesday. South Korean smokers purchased 2.31 billion 20-cigarette packs in the January-August period, compared with the previous year's 2.34 billion packs, according to data compiled by the finance ministry. Starting in January 2015, South Korea increased the price of cigarettes by 80 percent, from 2,500 won (US$2.25) per pack to 4,500 won, in an effort to curb smoking.

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The Korea Herald (http://www.koreaherald.com)

Moon, Kim to jointly announce outcome of summit in Pyongyang: Seoul

South Korean President Moon Jae-in and North Korean leader Kim Jong-un are scheduled to jointly announce the outcome of their summit in Pyongyang, a Seoul official said Wednesday. "It is still difficult to predict how an agreement will be reached between the two leaders," said Yoon Young-chan, the senior secretary to President Moon for public relations. "The announcement of the outcome too is scheduled though we do not know the exact time," the official added in a daily press briefing in Seoul.

Kim expects progress at next summit with Trump

South Korean President Moon Jae-in and his North Korean counterpart, Kim Jong-un, kicked off their historic summit Tuesday in hopes of reviving the stalled denuclearization talks between the US and the communist state. A closed-door meeting was held at the headquarters of the Central Committee of the Workers’ Party of Korea from 3:45 p.m. to 5:45 p.m., marking the first inter-Korean summit at the North’s ruling party building. The meeting ran beyond the allotted time by 30 minutes. Accompanying Moon on the South Korean side was National Security Office chief Chung Eui-yong and National Intelligence Service chief Suh Hoon, while Kim was joined by his sister Kim Yo-jong, vice director of the Central Committee of the North’s Workers’ Party and deputy chief of the ruling party’s propaganda and agitation department, and Kim Yong-chol, vice chairman of the same Central Committee.

Leaders of two Koreas to hold second meeting over nukes, ties

South Korean President Moon Jae-in and North Korean leader Kim Jong-un will hold a second and final round of talks Wednesday in their historic summit largely aimed at breaking an impasse in denuclearization talks between the North and the United States. In the first round of talks the previous day, Kim thanked Moon for brokering his summit with US President Donald Trump in June and expressed hope for further progress in the talks with the US. Moon highlighted the great responsibility he and the North Korean leader owed to their nation and the entire world.

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The Korea Times (http://www.koreatimes.co.kr)

Moon, Kim begin second round of talks

South Korean President Moon Jae-in and North Korean leader Kim Jong-un started the second round of formal talks in Pyongyang at 10 a.m. Wednesday, as the two leaders seek to establish lasting peace on the Korean Peninsula. In the first round of talks the previous day, Kim thanked Moon for brokering his summit with U.S. President Donald Trump in June and expressed hope for further progress in the nuclear talks with the United States. "I feel the great weight we must bear, along with a heavy responsibility. I wish this will be a summit that produces abundant results as a gift to the 80 million people of this nation for Chuseok," Moon said, referring to the upcoming holiday that falls on Monday.

Kim Jong-un has Trump in mind

Is U.S. President Donald Trump watching the news from Pyongyang? You bet. Would North Korea be giving President Moon Jae-in the red carpet treatment with Trump in mind? Kim Jong-un has every reason to do so. Not that Kim takes Moon lightly. After all, Moon has played well his stated role of honest broker between the U.S. and the North. Moon did so for a one-two summit in April and May, leading to the first summit between the leaders of the North and the U.S.

Moon, Kim watch art performance together in Pyongyang

The leaders of the two Koreas on Tuesday watched an art performance in Pyongyang together with their wives following the first day of their summit. The Samjiyon Orchestra staged a concert at Pyongyang Grand Theater in front of South Korean President Moon Jae-in and first lady Kim Jung-sook. The North's leader Kim Jong-un and his wife Ri Sol-ju were present as well. Kim arrived at the theater first and waited for the South Korean visitors.

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Chosun Ilbo (http://english.chosun.com)

Moon, Kim Talk Denuclearization at Workers Party HQ

President Moon Jae-in and North Korean leaders sat down for talks on Tuesday afternoon in Kim's office at Workers Party headquarters. Moon urged Kim to make more concrete commitments to denuclearization like handing over of a list of nuclear stockpiles, while Kim called for Washington to take a reciprocal step like declaring a formal end to the Korean War to reward him for dismantling the Punggye-ri nuclear test site.

Moon Under Pressure to Find Breakthrough in Denuclearization Talks

President Moon Jae-in is under tremendous international pressure to find a breakthrough in denuclearization talks between the U.S. and North Korea as he visits Pyongyang for three days. It will be his third summit with North Korean leader Kim Jong-un already this year. They are also expected to discuss improving cross-border relations, economic cooperation, and ways to prevent military clashes, but denuclearization is by far the hottest topic.

Compact Car Market Dwindles as Consumers Splurge on Size

Compact cars, once the typical entry-level or second cars in Korea, have seen their market share in Korea decline. The Korea Automobile Manufacturers Association on Sunday said domestic sales of compact cars dipped 2.2 percent in July on-year to 11,068 units, the 20th consecutive month of decline. In the first seven months of this year, only 73,177 compact cars were sold, down 10.6 percent from the same period last year. Peaking in 2012 at over 200,000, sales fell to just over 130,000 last year.

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HanKyoReh Shinmun (http://english.hani.co.kr)

North Korea gives unprecedented welcome to Moon

North Korea gave a warm welcome to South Korean President Moon Jae-in when he arrived at Pyongyang Sunan International Airport on Sept. 18. North Korean military gave their first gun salute to a South Korean leader, and the head of the honor guard referred to Moon as “Your Excellency Mr. President.”Both occurrences were unprecedented.

Significance of 17 chaebol chairmen and business leaders visiting PyongyangKang Many speculate that in areas of social overhead capital, such as joint railway, road, and electricity projects, a fairly detailed cooperation plan might even emerge. The businessmen said that “although it will be difficult to prepare business plans immediately due to realistic limitations such as the international community’s sanctions on North Korea, this visit could be a meaningful opportunity to listen to the thoughts of North Korea’s top leaders and economic ministers on economic and industrial cooperation is a meaningful opportunity.”

Pyongyang summit more specific in approach to resolving inter-Korean tensions

Two battle lines are drawn across the Korean Peninsula, which remains mired in the Cold War – the military and political confrontations between South and North Korea on the one hand and North Korea and the US on the other. In the Panmunjom Declaration, which was formulated during their first summit on Apr. 27, South Korean President Moon Jae-in and North Korean leader Kim Jong-un state that “there will be no more war on the Korean Peninsula.”

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The Dong-A Ilbo (http://english.donga.com/)

Moon, Kim embark third inter-Korean summit in PyongyangJapan Maritime Self- South Korean President Moon Jae-in and North Korean leader Kim Jong Un had a "surprise secrete conversation" on Tuesday before the commencement of the summit. The talk took place inside the vehicle heading towards the Baekhwawon guest house in Pyongyang.

Japanese billionaire to be the first civilian to fly around the moonIt has been The first civilian to travel to the moon on the SpaceX rocket will be Japanese billionaire Yusaku Maezawa, 42. Elon Musk announced on Monday (local time) at the headquarters of SpaceX in California that Maezawa will go on a week-long space travel aboard SpaceX’s Big Falcon Rocket (BFR) in 2023, according to a report by AP.

S-1 Corporation to share its 450 security patents for freeIt has been released on S-1 Corporation has decided to open its 450 security patents to its subcontractors. “Cooperation between diverse industries is a must in order to deal with the fourth industrial revolution,” S-1 CEO Yook Hyun-pyo said at the "S-1 Solution Fair 2018." “We will open some of our patents that could help industry convergence so that the security industry can take a leap forward.”

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JoongAng Ilbo (http://koreajoongangdaily.joins.com/)

Kim lays on warm welcome for Moon

President Moon Jae-in and North Korean leader Kim Jong-un had a first round of summit talks in Pyongyang on Tuesday, the initial day of a three-day summit, the first to be held in the North Korean capital in 11 years. The two leaders’ meeting began at 3:45 p.m., about six hours after Moon arrived by air, and ran until 5:45 p.m. with a focus on seeking ways to improve inter-Korean ties and ease military tensions along the border and, most importantly, denuclearize North Korea.

First ladies visit children’s hospital, collegeLeaders of Korea’s top four conglomerates The wives of the two Korean leaders met Tuesday on the sidelines of the third inter-Korean summit in Pyongyang and visited a children’s hospital and a music college together. The meeting between South Korea’s first lady Kim Jung-sook and North Korea’s first lady Ri Sol-ju marked the first time that the wives of the leaders of the two Koreas have met in

Cheers heard in Seoul as Moon steps off plane

The public response to the start of the third Moon-Kim summit was generally upbeat on Tuesday, although the atmosphere was far more subdued in the National Assembly as conservative lawmakers remained pessimistic that the meeting would bring about any tangible results.Crowds gathered around the TVs in Seoul Station, central Seoul, to watch the live broadcast of South Korean President Moon Jae-in stepping off the plane to be greeted by North Korean leader Kim Jong-un on the tarmac at Pyongyang Sunan International Airport. The two leaders’ embrace was met with applause, with some members of the public capturing the moment with their smartphones.

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The KyungHyang Shinmun (http://english.khan.co.kr/)

Pyongyang Inter-Korean Summit, Hopefully the Cornerstone of Denuclearization and Peace

President Moon Jae-in and Kim Jong-un, chairman of the North Korean State Affairs Commission will hold the third inter-Korean summit in Pyongyang on September 18. President Moon's trip to North Korea will be the third following presidents Kim Dae-jung and Roh Moo-hyun. Compared to the trips by the two previous presidents, President Moon will not be traveling to Pyongyang with a light heart. At the summit in 2000, nuclear weapons were not an issue, and in 2007, President Roh was able to concentrate on inter-Korean relations for the direction was already set toward denuclearization at the six-party talks and in a follow-up agreement between North Korea and the U.S. But this time, denuclearization lays heavy on the president's shoulders. In addition, international conditions are not so sunny with the United Nations Security Council holding an emergency meeting to discuss the implementation of sanctions on North Korea on the first day of the president's trip to North Korea.

Internet Bank Restrictions for the Chaebol to Be Determined by Enforcement Decree: Undermining the Separation of Banking and Commerce

On September 17, the three ruling and opposition parties agreed to vote on bills concerning deregulation and the people's economic activities at a parliamentary session on September 20. These bills include an act on special regulations for Internet banks, a regulation-free zone act, and the Commercial Building Lease Protection Act.

Distorted Argument of a Comprehensive Real Estate Tax “Bomb” Deceiving the People

It's the "tax bomb" again. The Liberty Korea Party and the conservative press are pouring out false arguments of a tax bomb after the government released new measures to curb the real estate market on September 13. The new measures included a tougher comprehensive real estate tax. This is a vivid deja vu. It's a repeat of the "tax bomb" curse, which they had cast to mislead the public and block the comprehensive real estate tax when it was first introduced in 2005. The Liberty Korea Party released a series of comments to fight the September 13 measures, claiming it was a tax bomb. The party used expressions, such as a "high-intensity tax bomb," "punitive taxation and tax bombs," and "tax bombs on even the middle class in reality." The conservative media joined in, busily casting a red frame over the government's measures mentioning a "punitive tax bomb policy" and "a comprehensive real estate tax bomb." They continued to attach the word "bomb" making it look like many of the citizens would suffer a fatal blow and pay more taxes.

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AJU Business Daily (http://eng.ajunews.com/korea)

Moon and Kim praise each other at talks in PyongyangSouth Korean President Moon North Korean leader Kim Jong-un praised South Korean President Moon Jae-in for making "tireless" efforts to bring peace to the Korean peninsula at their fresh summit in Pyongyang that followed a stalemate in denuclearization.

S. Korean President visits Pyongyang to attend inter-Korean summit

South Korean President Moon Jae-in visited Pyongyang on Tuesday to attend the three-day inter-Korean summit with North Korean Kim Jong-un. The South Korean president was accompanied by his counterpart in the North on a drive through Pyongyang where tens of thousands of citizens welcomed their neighbor waving North Korean flags, unification flags, representing all of Korea, and colorful paper flowers.

Moon and Kim praise each other at talks in Pyongyang

North Korean leader Kim Jong-un praised South Korean President Moon Jae-in for making "tireless" efforts to bring peace to the Korean peninsula at their fresh summit in Pyongyang that followed a stalemate in denuclearization. "There was a big achievement because of President Moon's tireless efforts," Kim said in his opening remarks at the start of a two-hour meeting in the headquarters of the Central Committee of the Workers' Party of Korea. He said Moon should be complimented for arranging a historic summit between North Korea and the United States in Singapore in June.

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Maeil Business News Korea ( http://www.pulsenews.co.kr/)

Korean summits in 1st round of talks amid cheery mood and lingering doubts

Flushed from the topmost red-carpet welcome from his state hosts as well as civilians upon arriving at Pyongyang by air early Tuesday, South Korean President Moon Jae-in embarked on his first round of talks with North Korean leader Kim Jong-un in a cheerful mood as skeptics back at home and in Washington remain doubtful of a breakthrough on the denuclearization bottleneck, which is essential to any development in the inter-Korean relationship.

Kolon Industries completes construction of tire cord production plant in Vietnam

Kolon Industries Inc., the chemical and fashion unit of South Korea’s Kolon Group, said on Tuesday that it has completed construction of a polyester tire cord production facility in Binh Duong Province in Vietnam, which would boost the company’s total annual production capacity to 93,800 tons, about 15 percent of the global tire cord market.

Inter-Korean railway to provide new business opportunities: experts

South Korea can become a major global distribution hub once railway linking South and North Korea boosts trade in Eurasia and the Pacific Rim, experts said on Tuesday. There will also be more opportunities for logistics companies to expand business. Officials from the government and logistics companies Tuesday held a conference on the theme of “Reconnecting Asia” under the auspices of the Korea International Trade Association and U.S. Center for Strategic and International Studies in Seoul, timed with the third inter-Korean summit held in Pyongyang.

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Lee Kyung-sik edt@koreapost.com

Lee Kyung-sik edt@koreapost.com