Overseas sale of companies recommended

Korea's economic crisis could be repeated if the current situation that both bureaucrats and Koreans see overseas sale of companies such as Hyundai Engineering & Construction to overseas investors as an outflow of national wealth, experts warn.

Also, the experts warned that this country would face another critical situation during the second half of next year when bonds that Korean companies issued to raise emergency funds are to mature.

Bill Hunsaker, executive director of ING Barings, John Burton, Seoul correspondent of the Financial Times, and Lee Nam-Woo, managing director of Samsung Securities, expressed their views about the Korean economy at a Wednesday's panel discussion organized by Dong-A Ilbo.

"Hyundai Engineering and Construction is in a critical situation that it could not repay its debt even with its entire operating profit, but there was no discussion about overseas sale of the company,¡± Burton said. ¡°In the long run, overseas sale of the company would create more profit and jobs for Hyundai."

Hunsaker said: "Korean corporations' debt that is to mature within the next six months is greater than their operating profit. And redemption of collateralized bond obligation (CBO) and high-yield fund that was rolled over with tax exemption benefit would be the stumbling block for the Korean economy during 2001.¡±

Also, Lee pointed out that the government is seeking to foster venture companies, to restructure corporations and to promote South-North Korean economic cooperation, but it will be difficult to succeed in all three areas. He said that it is time that all energy should be focused on corporate restructuring.

Kim Seung-Ryun srkim@donga.com