Kim: Daewoo Motor's survival hinges on restructuring

President Kim Dae-Jung assured Monday that the government would certainly revive Daewoo Motor if it undergoes a thorough restructuring. He also suggested that the nation tolerate temporary suffering in order to maintain global competitiveness.

On Monday, the Inchon City government reported its operations to President Kim. At the meeting, President Kim said that the government could not just sit and watch any longer while the ailing carmaker causes defaults worth about 100 billion won each month. He said that the government couldn¡¯t help but let the company be finally declared bankrupt because it is part of the government¡¯s duty.

He also emphasized that it is important to secure flexibility in employment such as laying off and hiring according to needs. If a company tries to stay afloat without reducing its payroll, all employees could become jobless, he said.

The President recollected the cases of Kia Motors and Samsung Motors, which faced crises similar to Daewoo Motor¡¯s and caused great pain to the local economy.

And he said that Daewoo Motor should be reborn as a company which makes money based on economic principles, and in that case, the government would help it revive.

Regarding the issue, Lee Ki-Ho, a chief Presidential economic advisor, said that a court will pass the final judgment on whether or not to start the court receivership for Daewoo Motor on Nov. 27 and that restructuring is a prerequisite for the court action. He said that if Daewoo Motor goes back on its normal business track, it could issue a recall order for its products with defects. He also said that Hyundai Motor had once fired 10,000 employees but they all came back to the workplace two years later.

Meanwhile, President Kim attended an opening ceremony for the Inchon International Airport expressway and gave a speech, in which he urged the people to join forces once again just like they had in waging massive gold-collecting campaigns years ago.