Stronger Mid-sized Businesses for Korea’s Economic Revival [Arirang News]


Korea’s top conglomerates and brands have
the global spotlight at the moment… but in the shadows of the wings… exist the nation’s
underdeveloped small- and medium-sized enterprises. Experts now say that their future… will
creates Korea’s. Arirang’s Hwang Ji-hye looks into the country’s
next big economic challenge. Hidden champions… that is what the nation’s
small yet highly successful companies have been called. But the truth is… these companies have long
been left out in the cold in Korea… a place where family-controlled conglomerates have
dominated the economy for decades. Mid-sized businesses… with sales of 150
billion won,… or roughly 140 million U.S. dollars,… account for just zero-point-0-4
percent… of the more than 3-point-1 million corporations registered in the country,…
according to KOTRA, the state-run trade promotion agency. This is significantly low… compared to other
nations around the world. The ratio stands at around 12 percent in Germany,
over 4 percent in China… and 3-point-7 percent for Japan. While an expert says… that mid-sized companies
are what keep an economy stable in times of global economic uncertainty… and create
jobs — even more than the conglomerates — the ground under them is not yet fertile enough
to promote growth. “Small businesses, with up to around 7-and-a-half
million dollars in owned capital, are entitled to various financial and tax benefits from
the government, but once they grow larger, all of the benefits are immediately cut off.
At the same time, they’re growth is bothered by large companies… that are trying to pick
them out of the race.” Given that,… the situation now is likely
to be turned in favor of mid-sized businesses by the incoming administration of President-elect
Park Geun-hye. She has promised to provide customized support
to small companies… to help them to grow into mid-sized firms. A center solely for mid-sized enterprises…
under the Ministry of Knowledge Economy that was established last November… is expected
to back up her plans. “Mid-sized companies didn’t have a place to
talk about their difficulties. Now that the High Potential Enterprise Promotion Center
has been established, we are planning to provide a better business environment for mid-sized
businesses.” Experts add… that Park’s transition team
should also push through measures that introduce stricter punishments for conglomerates…
that engage in unfair practices… to level the playing field for small- and mid-sized
enterprises. Hwang Ji-hye, Arirang News.

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