The recent Gestapo tactics used by the Seoul Metropolitan Government to harass and disrupt business at Costco Wholesale is disgraceful. Sadly, these anti-foreign measures of bullying foreign companies that are successful in the Republic have been standard procedure in Korea. However, as they expand their globalization rhetoric and continue to seek foreign direct investment, Korea’s hypocritical practice needs come to an end, because they aren’t fooling anyone, anymore.
To be clear, everyone in business is aware of the “Korea Discount,” this unlevel playing field in the Korean market from corruption to protectionism is preventing Korea from taking the next step in their advancement in this global economy. In the past, Carrefour, the National Cattlemen's Beef Association, Wal-Mart, Lone Star, Standard Chartered, and Apple have had to fend off these attacks. Today, Costco Wholesale is the target, and Korea is showing its true colors with the orchestrated effort by the government, labor organizations, and the media to attack these non-Korean entities.
In an election year, it is no surprise to see this type of shameful propaganda being used to galvanize support through protectionist rhetoric. I only wish the people of Korea would recognize it for what it is and finally demand for it to end.
Make no mistake; helping mom-and-pop stores is not the issue. They have been suffering for a long time, because they are dinosaurs in a modern economy. Their business model is flawed, as rational people don’t want to buy inferior produce or the same products at grossly inflated prices. Most of these shops are rundown, dirty, and cluttered. The service is subpar, and consumers don’t actively choose to shop there. They shop there when they are in a pinch.
Creative destruction of these mom and pop stores is inevitable. It is the nature of things in a capitalist economy. If the Seoul Metropolitan Government really wanted to help these small business owners, they would either help them become more competitive or they would help them to transition into an economically feasible business.
As it stands, they have done neither, because mom-and-pop stores are not the issue. It is the red herring.
Sunday closers are just an inconvenience to customers that won’t solve the fundamental flaw of mom-and-pop stores. Moreover, if due diligence had been done, the Seoul Metropolitan Government would have discovered that consumers who shop at Costco Wholesale don’t care to shop at mom-and-pop stores.
The real issue is the jealousy and resentment of Costco Wholesale’s success in Korea. Though they have tried, unsuccessfully, to copy it with Vic Market, Korea has been unable to compete with Costco’s quality and selection of products and services, and their commitment to the lowest possible prices.
While foreigners’ favorite derogatory euphemism for Korean businessmen continues to be, a stone-aged farmer in a suit, does one really believe that Korea will ever be the Hub of Asia?
It is time for Korea to truly transition beyond the appearance of modernity, to start conducting business properly by following the rule of law, and to stop harassing successful non-Korean businesses.
Steven Austin
Seoul