This is the 14th in the "Letters to President Yoon" series The Korea Times has organized to convey policy recommendations in open letters from politicians, scholars and experts to President Yoon Suk-yeol following his May 10 inauguration. ― ED.
By Christoph Heider
Dear Mr. President,
The European Chamber of Commerce in Korea (ECCK), on behalf of its members, expresses our warm congratulations on your inauguration as the president of the Republic of Korea.
The European business community is an essential contributor to Korea's economic growth by conducting science-based research and development, producing and bringing innovative products into Korea, as well as employing a substantial number of people ― more than 200,000.
It's been 12 years since I moved to Korea and as a member of the business and ECCK community, I have worked with several administrations here. Therefore, I was very impressed by your openness to get connected and your willingness to pursue steady collaboration and information exchange. In fact, that is what the ECCK also has preferred and thrived in doing. I hope and believe that with the continuation of a transparent and open dialogue among you, your administration and the European business community, together we will be able to cope with and overcome the massive challenges we are currently facing.
Beyond the ongoing pandemic, the real challenges lay in several different areas: the interruption of supply chains, enormous consumer price inflation, Korea's national debt and the risk of economic stagflation.
Please allow me to raise some issues specific to the Korean business environment. Korea is a global economic powerhouse. It is the world's tenth biggest economy and sixth-biggest exporter. It is time to be proud of those achievements and to play a more pivotal role on the global stage. Korea's voice needs to be heard when it comes to international trade policies or the setting of international standards.
I am afraid to say that too many rules and regulations are either not in line with global standards or only partly so. It is also my firm belief that the full adoption of and adherence to global standards will not only improve efficiency and effectiveness for European and Korean multinational companies but also for small and medium-sized enterprises (SMEs) on both sides. At the moment, innovative economic power for Korea is simply wasted as many SMEs do not dare to start exporting to Europe because expert knowledge on global standards is missing. Adherence to and adoption of global standards will facilitate business overall and in particular boost opportunities for Korean SMEs overseas.
The European business community strives to invest further, extend business and hire additional people to work in their operations here. I am sure that European companies would love to invest even more, but in fact, there are some issues hindering us from doing so. One of the main concerns in this respect is the rigid and in some areas outdated labor law. The pandemic has proven how flexible companies can be managed and how flexible employees can work ― if they are only allowed to do so. In my opinion, Korea's labor law should be modified to provide more flexibility ― both flexibility in ways of working as well as in working times.
The other area that needs to be covered in modern labor law is the fast-changing complexity of our lives. Business is performance-driven and skill sets that were an asset in the past but are not required anymore should be replaced by new skill sets. What ends up happening is that a certain share of the workforce ― especially those reluctant to change ― cannot fulfill new job requirements any longer and gradually become low performers. Thus, there must be a compliant way to be able to separate productive workers from those who are low performers and unwilling to adapt.
Another main obstacle to additional foreign direct investment is the liability of the CEO ― especially the criminal liability. This situation recently became more visible again due to the Severe Accident Punishment Act. European business leaders are here to grow their business in line with the governing legal framework. Nevertheless, there is no guarantee in the modern world that everything works like clockwork. Please have a look also into the legal frameworks of other countries where not every deficiency leads to criminal but rather to administrative procedures.
Deregulation will help both the Korean and European business communities contribute further to economic growth and prosperity. Again, I wish you and your team of ministers all the best for leading Korea into an even brighter future and be assured that the European business community is always there to support you.
The writer is the president of the European Chamber of Commerce in Korea.
By Christoph Heider
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The European Chamber of Commerce in Korea (ECCK), on behalf of its members, expresses our warm congratulations on your inauguration as the president of the Republic of Korea.
The European business community is an essential contributor to Korea's economic growth by conducting science-based research and development, producing and bringing innovative products into Korea, as well as employing a substantial number of people ― more than 200,000.
It's been 12 years since I moved to Korea and as a member of the business and ECCK community, I have worked with several administrations here. Therefore, I was very impressed by your openness to get connected and your willingness to pursue steady collaboration and information exchange. In fact, that is what the ECCK also has preferred and thrived in doing. I hope and believe that with the continuation of a transparent and open dialogue among you, your administration and the European business community, together we will be able to cope with and overcome the massive challenges we are currently facing.
Beyond the ongoing pandemic, the real challenges lay in several different areas: the interruption of supply chains, enormous consumer price inflation, Korea's national debt and the risk of economic stagflation.
Please allow me to raise some issues specific to the Korean business environment. Korea is a global economic powerhouse. It is the world's tenth biggest economy and sixth-biggest exporter. It is time to be proud of those achievements and to play a more pivotal role on the global stage. Korea's voice needs to be heard when it comes to international trade policies or the setting of international standards.
I am afraid to say that too many rules and regulations are either not in line with global standards or only partly so. It is also my firm belief that the full adoption of and adherence to global standards will not only improve efficiency and effectiveness for European and Korean multinational companies but also for small and medium-sized enterprises (SMEs) on both sides. At the moment, innovative economic power for Korea is simply wasted as many SMEs do not dare to start exporting to Europe because expert knowledge on global standards is missing. Adherence to and adoption of global standards will facilitate business overall and in particular boost opportunities for Korean SMEs overseas.
The European business community strives to invest further, extend business and hire additional people to work in their operations here. I am sure that European companies would love to invest even more, but in fact, there are some issues hindering us from doing so. One of the main concerns in this respect is the rigid and in some areas outdated labor law. The pandemic has proven how flexible companies can be managed and how flexible employees can work ― if they are only allowed to do so. In my opinion, Korea's labor law should be modified to provide more flexibility ― both flexibility in ways of working as well as in working times.
The other area that needs to be covered in modern labor law is the fast-changing complexity of our lives. Business is performance-driven and skill sets that were an asset in the past but are not required anymore should be replaced by new skill sets. What ends up happening is that a certain share of the workforce ― especially those reluctant to change ― cannot fulfill new job requirements any longer and gradually become low performers. Thus, there must be a compliant way to be able to separate productive workers from those who are low performers and unwilling to adapt.
Another main obstacle to additional foreign direct investment is the liability of the CEO ― especially the criminal liability. This situation recently became more visible again due to the Severe Accident Punishment Act. European business leaders are here to grow their business in line with the governing legal framework. Nevertheless, there is no guarantee in the modern world that everything works like clockwork. Please have a look also into the legal frameworks of other countries where not every deficiency leads to criminal but rather to administrative procedures.
Deregulation will help both the Korean and European business communities contribute further to economic growth and prosperity. Again, I wish you and your team of ministers all the best for leading Korea into an even brighter future and be assured that the European business community is always there to support you.
The writer is the president of the European Chamber of Commerce in Korea.
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