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[Editorial] Cut the Yoke of Regulations

Posted August. 09, 2004 22:10,   


Even with idle capital, companies are disinclined to invest locally. Some big corporations are restricted in their investment because of limits on investments they make between their subsidiaries. International capital is briskly passing up this country. Before reversing the current state of affairs, a repeated verbal commitment to job creation through fresh investment won’t turn around the economy.

No one denies that enlivening investment is central in turning the vicious circle into a positive one. What is at issue is whether there are concrete efforts to eliminate factors that contract investment or make them difficult. Among them should be a paradigm-shifting attempt at deregulation. The government and the National Assembly are held responsible for implementing them. In this respect, some Uri Party lawmakers’ proactive moves to further raise or repeal the cap on the cross-investment within big corporations should be welcomed although they came late. However, these moves are backpedaled by other quarters of the ruling party on the pretext that there should be no retreat in corporate reform.

Until when should they wander around and take one step forward only to take another back? It is deplorable since an opportunity is likely to be missed to eliminate a factor in the contraction of investment and thereby snuff out hope for immediate job creation and potential for long-term growth. If one believes sticking to regulations amounts to economic reform, he doesn’t know about the economy at all. We’d like to ask him whether he can see the gushing global economy and the stagnant local economy.

The effects of an untimely policy are adverse rather than positive. Currently, over-investment is not an issue. A draught of investment is undermining the potential for economic growth. However, those who insist on improving corporate transparency and ownership structure in the name of market reform, rather than eliminating barriers to investment, still remain obstinate. The case in point: the Fair Trade Commission is lambasting corporations for their demand for deregulation.

We see the spoilers in enlivening the economy as those who are biased towards “reform is good” in the face of a cooling economic engine and an implosion of the economy. We urge the government and the ruling party to stop wondering and cut the yoke of regulations.