Korean Trade Pioneer Offers Insight

Kim Ki-tak, the CEO of Samhwa Corporation, arrived in Hong Kong at the age of 27 in October 1948 with a cargo of dried squid. It was five days after he left Incheon, being on board of a cargo ship of Swire Group, the British trading company. Centered in Hong Kong, he earned 50,000 dollars after he sold 2,000 tons of dried squid to a wholesaler of imports.

The first generation of Korean traders who traveled on cargo ships along with him exported squid, eggs, zinc, tungsten and others to Hong Kong, earning money abroad. Although they had no industrial goods to sell, they had passion and ambition as young entrepreneurs of Korea. Thanks to their efforts, Korea, the then new independent state, recorded 14.2 million dollars in exports in 1948.

Kim Ki-tak introduced penicillin and textiles for suits to Korea with the money he earned by exporting squid and tungsten to Hong Kong. Whenever he returned to Korea from Hong Kong, his fortune accumulated enough for him to buy a nice house in Korea. He established Samhwa Industrial Co. Ltd., exporting various items abroad in 1949. In 1967 he also founded Samhwa Paper Co. Ltd.

In the early 1960s, he exported leaf tobacco to Germany, and throughout the 1970s and early 1980s, he exported paper products to Southeast Asia, including Bangladesh and Pakistan.

The export volume of Samhwa Industrial Co. even surpassed 30 million dollars in the early 1980s. However as Samhwa Group initiated trading businesses in full swing from the late 1980s, their market dominance declined, leading them to reduce the share of trading and focus more on paper businesses for domestic demand.

He has been an executive of the Korea International Trade Association (KITA) for 52 years since 1954. For 14 years from 1971, he served as vice president of KITA. Both of the terms are the longest ever in KITA’s history. KITA will award him with a medal of honor on July 28 at its 60th anniversary ceremony.

In the afternoon of July 24, I met the honorary chairman of Samhwa Paper Co. Ltd, Kim Ki-tak (85) at the office building in Sogong-dong, Jung-gu, Seoul, a piece of living history of Korean trade. His heartfelt affection toward trade and KITA were felt during his one-and-a-half-hour interview.

He was asked what he would like to say to KITA Chairman Lee Hee-beom.

“Korean companies are at war with other companies all around the world. Without their will to fight, they would end up losing the war. The government must help entrepreneurs fight to their utmost. The new chairman should lead the efforts in this aspect.”

He emphasized that entrepreneurs are responsible for making a country where they could do business happily and with ease.

“Businessmen have much trouble unknown to ordinary people. They would better enjoy a glass of drink at night in a cozy atmosphere, which isn’t really so yet.”

He was also critical of KITA.

“There are so many employees there. New members are brought in whenever a new chairman comes in. It is true that many of KITA chairmen so far have focused more on being favored by the government than trading businesses themselves. This needs to change now.”

For 12 years from 1970, he served as vice chairman of the Korea Chamber of Commerce and Industry (KCCI) and he is also the founding member of the Federation of Korean Industries.

He pointed out weaknesses in the activities of Korean economic organizations.

“Economic organizations need to speak up before the government. When Park Doo–byung, the late chairman of Doosan Group, was the chairman of KCCI, he often used to speak up with confidence, but now people there are reluctant to say what is right without their own critical thinking. They don’t want to look bad.”

Regarding the Korea-U.S. FTA, he replied, “I am not at a position to comment on it,” but added, “Now is the time for Korea to compete with the world.”

Jin-Young Hwang buddy@donga.com