“South Korea’s Strategy of Becoming Northeast Asia Hub is a Mere Gesture”

“The capital flowing to China will not divert its way towards South Korea only because of its construction of economic free trade areas. Unless South Korea as a whole changes into a free trade area, the Northeast Asia Hub project will stop short, becoming a mere ad-hoc plan.”

On Wednesday, EU Chamber of Commerce in Korea (EUCCK) President Frans Hampsink, during the press conference held at Shilla Hotel in Jangchung-dong, Jung-gu, Seoul, criticized South Korea’s “Northeast Asia Economic Hub policy.”

At the press conference, also celebrating the publication of the “‘2005 EUCCK Trade Barrier Economic White Paper,” he demanded changes in the regulations, saying, “Every year, we submit a 300-page report that condemns South Korea’s high trade barrier, but 75 percent of the content is merely repeating material from the previous year.”

“Talks Alone Will not Bring about the Northeast Asia Hub”-

Hampsink criticized the government’s policy of the hub strategy, saying,“We think there exists no long-term project for the South Korean economy.”

He said, “China possesses various areas of economic free trade, and it is an attractive market for foreign investors due to its strong potential for economic growth and low cost benefits. Capital will not be diverted on its way from China to South Korea merely because South Korea decides to open up some areas of free economic trade.”

Soon after, he criticized, “Like Singapore or Dubai, South Korea as a whole must change into a free trade area in order to counter China’s economic power, and become the Northeast Asia’s ‘free trade area hub.’ So far, we have given numerous suggestions to the South Korean government, but it has been stubborn, refusing to hear our opinions.”

“Unshackle the Restrictions”-

European businessmen working in South Korea have poured complaints about the South Korean government’s restriction policies.

Hampsink asserted, “The South Korean government is still deeply soaked in bureaucracy and lacks cooperation among the governmental branches. We have been dealing with the issue for 7-8 years, and I have to say that I’m not pleased with the way South Korea has been dealing with it.”

He added, “I have not proposed an economic white paper to fight the South Korean government, but I have to say that I’m disappointed in the way the South Korean government is dealing with the matter every year.”

Demanding Reform on Restrictions Imposed on each Industry-

Not only Hampsink but also Aerospace & Defense, Agro-Chemicals, Automotive, and Banking under EUCCK, a total of eight committees’ chairmen, participated in the press conference, complaining about the difficulties of conducting business in South Korea.

They demanded unshackling of the restrictions, such as the On-Board Diagnostics System (OBD) carried out in January of this year, joint ownership of business management between foreign financial institution factions, and advertisements of functional cosmetic products. Also, they demanded the South Korean government to come up with measures to deal with fabricated medicine products and to decrease tax by implementing the consolidated tax return system.

As a response, Trade Negotiation headquarters stated, “We will reflect the reasonable opinions in making the policy decisions, and clarify the misunderstandings with EUCCK, if any.”

Young-Hae Choi yhchoi65@donga.com