Accountability sought for failed sales

Jin Nyum, Minister of Finance and Economy, said that someone has to take the responsibility for the failure in sales negotiation of Hanbo Steel and Daewoo Motor.

Also, he said that there exists a serious gap between the economic indicators and the real economy due to differences between export sales and domestic sales, and among various industries. He noted that the government will work out a measure to nurture strategic industries of each region to boost regional economies.

He told reporters at a report on the current economic trends that the government won't hurry for overseas sale of Hanbo Steel and take time through normal operation of the plant.

Jin said that both the government and creditors will take the responsibility for the failure of Hanbo's sale. But he said that the failure in the sale of Daewoo Motor to Ford Motor is due largely to Ford's internal situation, hinting that the call to hold someone accountable would be weaker than in the case of Hanbo Steel.

The Financial Supervisory Commission reportedly has begun to examine who is responsible for the failure to sell these corporations at the direction of President Kim Dae-Jung.

A government official explained that secretariat for sale of Hanbo Steel, which consists of Korea First Bank and other creditors, and the Daewoo restructuring team will be held responsible for the failures. He noted that creditors' collection of rights of sale from Daewoo restructuring team could be blamed for the failure, adding that it could lead to resignation of the team leader Oh Ho-Keun and other members or dismantling of the team.

Meanwhile, some observers ponder whether it is desirable to seek scapegoats following the remarks of President Kim. Also, it is expected to be criticized if working-level officials of the private sector are blamed and government officials are excluded.

Minister Jin also said that one of the biggest problems facing the nation's economy is the regional imbalance. In particular, economies of Busan, Daegu, South and North Jolla Provinces, and South Chungcheong Provice, where growth-oriented industries are lacking, are suffering from difficulties.

According to the Ministry of Finance and Economy, the regional industrial production index, which is pegged to 100 for 1997, for the second quarter of the year is 167.6 for the Seoul metropolitan area but only 122.2 for all other areas. The situation is the same in the construction industry, with the metropolitan area almost recovered to the pre-crisis level but other regions still at 50% to 60% of the business level recorded in 1997.