Tag: business

I agree with South Korea’s move to increase chip production, but putting these plants within North Korean artillery range around Seoul is not a good idea. These plants are so important they should be built further south out of artillery range:

South Korea will create the world’s largest semiconductor cluster in the Seoul metropolitan area by attracting 300 trillion won (US$229.81 billion) in investments as part of efforts to secure a competitive edge in the sector, the industry ministry said Wednesday.

It is part of the government’s comprehensive plan to promote six key industries — chips, displays, secondary batteries, bio, future vehicles and robots — which also called for the corporate investment of 550 trillion won by 2026, according to the Ministry of Trade, Industry and Energy.

Yonhap

You can read more at the link.

Some happy chaebol chiefs today in South Korea:

Korea and the United Arab Emirates (UAE) signed a total of 24 agreements worth $6.1 billion in traditional industries, such as energy and defense, as well as emerging businesses, including hydrogen, mobility, bio and digital transformation, according to the Ministry of Trade, Industry and Energy, Monday.

The ministry said about 320 officials from business lobby groups, Samsung Electronics, Hyundai Motor Group and other Korean companies, who accompanied President Yoon Suk Yeol’s state visit to the Middle Eastern country, held the Korea-UAE Business Forum at the Rixos Marina Abu Dhabi hotel.

Korea Times

You can read more at the link.

What the U.S. is doing is pushing industries to make a choice between the U.S. or Chinese markets. Korea is trying to find a middle ground which so far the Biden administration does not want to offer them:

Korea Inc. faces an uphill battle as a push in the United States for economic security is taking its toll on companies dependent on China for manufacturing or for the supply of materials and components.    
   
The U.S. is passing laws and enacting executive orders to bring the manufacturing of products important to national interest back to U.S. soil. Chips, batteries, electric vehicles(EV), solar cells and certain biotechnology products are on the list, and China is the main country of concern.    
   
A number of Korean companies have been affected already.  

Hyundai Motor’s EV sales in the U.S. have fallen since the passage of the Inflation Reduction Act (IRA), as its EV models won’t be qualified for the subsidies under the act.    
   
Samsung Electronics and SK hynix are having to rethink their use of China as a major manufacturing base for semiconductors as a number of U.S. rules are making it difficult to transfer key technologies to China, which is the second largest source of memory chips for these companies after Korea.      
   
Korea feels betrayed by its ally and is fighting for workarounds that would allow its companies to continue sourcing heavily from China. It is now engaged in an intense lobbying effort to get the rules watered down or waivers for its companies.  
   
This anniversary special will explore the impact of the U.S.-China tech war on Korean business and map out ways to curtail the damage. It is based on interviews with academics and researchers.    
   
Some argue that the dependence on China needs to be reexamined, while others argue that the Yoon Suk-yeol administration should come up with sizable financial incentives and tax cuts to attract manufacturing facilities for chips and high-tech products to Korea. 

Joong Ang Ilbo

You can read more at the link.

It will be interesting to see if under her leadership she is able to make Naver a global IT brand:

Naver will become an incubator that creates innovative technology penetrating the global market and seek to go beyond providing services that are popular today, the company’s new CEO said Monday. 

“Not only all businesses owned by Naver began with the thought of going global from the start, but all of the objectives also point to going global,” Naver CEO Choi Soo-yeon said at a meeting with shareholders and board of directors where she was appointed as the new chief.

The IT giant will focus all of its management efforts on becoming a global top-tier internet company, it added.

The appointment of the 41-year-old female executive marks a major shift in its management, the company said. Choi is the youngest CEO to lead Naver, South Korea’s fourth-largest company by market capitalization. Having Choi as CEO signifies that the management will be led by the younger generation who grew up with the internet, and no longer by those who pursued evolution of the platform businesses.

Korea Herald

You can read more at the link.

If these teleworkers have work from home syndrome than the entire U.S. military needs to get diagnosed with this disorder because even when you are off duty you are still on duty. Maybe servicemembers can get an extra VA rating for this 😉 :

Three out of every 10 employees who telecommute are experiencing “work-from-home (WFH) syndrome” as the pandemic rolls on and the boundary between work and life blurs. 

According to a survey of 910 remote workers conducted by recruiting platform Job Korea from Sept. 3 to 10, 32.1 percent of the respondents said they have experienced the WFH syndrome, experienced as physical and emotional stress.

Where multiple answers were allowed, 54.8 percent said they experienced the feeling that they were still working even after work hours, similar to 46.2 percent who answered they felt a nervous and stressed all day. 

“In a from-home working environment, the physical distinction between work and home life is pretty vague. I think that’s why I can’t get my mind off of work even when my computer is turned off and feel like I’m working all day,” said a 28-year-old employee in Seoul who asked to be identified only by her surname Kim. 

Korea Times

You can read more at the link.

The real story is not being reported is what President Moon wants from the Biden administration in return for these investments. My guess will be he wants the U.S. to be more flexible on sanctions to jump start his North Korea engagement policy:

The United States is the world’s leading technology and innovation hub, but it is not a leader in the high-tech supply chain, mostly relying on Asian countries for essential items, such as semiconductors and batteries for electric vehicles. 

In the face of growing challenges from China, U.S. President Joe Biden wants to revitalize the domestic manufacturing capacity amid the global chip crisis and a looming shortage of batteries, and he is expected to welcome a series of announcements of massive investment plans by Korean companies ahead of and after his summit talks with South Korean President Moon Jae-in on Friday.

Yonhap

You can read more at the link.

Some further relief for business owners in South Korea:

The government said Saturday it will allow businesses outside the greater Seoul area to operate until 10 p.m. starting next week, relaxing the distancing rules amid growing discontent over the prolonged virus curbs. 

The revised measure will permit businesses like restaurants and fitness clubs to extend their operating hours by one hour under Level 2 distancing currently imposed on the provincial regions, Prime Minister Chung Sye-kyun said in a government response meeting.

“After careful deliberation based on the various opinions from all walks of life, we are adjusting the business hours for publicly used facilities,” he said.

Yonhap

You can read more at the link.

Major conglomerates in South Korea are ready to push back against the ruling party’s attempt to make them give up profits to other companies not making profits. It is going to be interesting to see how this plays out:

The move is sparking backlash from large business owners, with major companies claiming the measures are only implemented in socialist or communist countries. Companies have also been criticizing the proposal over the lack of guidelines determining on which level a company is deemed profitable.

The ruling party has stressed that the profit-sharing scheme would not be compulsory and that each company’s voluntary participation would be encouraged through various incentives. However, business insiders believe the government will continue to pressure firms to take part in the initiatives.

“The government says it is voluntary but will continue to pressure firms to take part in the profit-sharing scheme,” an industry official said. “The Moon Jae-in administration has restrained companies with dozens of new regulations that severely impact business operations. This administration has pressured companies financially much more than other previous governments.”

Dozens of corporations including Samsung Electronics, LG Electronics, Kakao and Woowa Brothers are expected to be subject to the scheme as they have been able secure large profits amid the prolonged pandemic.

Korea Times

You can read more at the link, but it is the responsibility of the government that shutdown companies like restaurants and bars to subsidize them through tax money, not other private businesses.

This is a pretty prestigious recognition for Coupang:

Coupang is No. 2 on the 2020 CNBC Disruptor list.  
   
It is the first Korean company to make it onto the list, which has been published by the U.S. business channel since 2013. Coupang was also the first Korean company to be nominated.  
   
Each year, the broadcaster identifies 50 private companies with breakthroughs influencing business and market competition. All private, independently owned start-up companies founded after Jan. 1, 2005 were eligible to be nominated this year.  
   
Coupang was ranked No. 2 from a total 1,355 nominees selected by the station and a board of advisors.    
   
How the companies reacted to the coronavirus was key in the selection process this year. CNBC gave credit to the retailer’s fast delivery service, and its effort to replenish necessities, such as face masks and hand sanitizers, during the pandemic.    
   
The American broadcaster ranked Coupang high on the list considering its ability to withstand a rush of online orders during the virus outbreak while maintaining its quality delivery service. CNBC complimented the company for freezing the prices of face masks and hand sanitizers to prevent customers from being adversely affected by the disruption in the supply chain caused by the outbreak.    
   
Coupang said in a statement Wednesday that its vast logistics network and infrastructure it aggressively built in recent years may have helped it reach second place. The retailer claims more than 70 percent of the Korean population lives 10 minutes away from its “Rocket Delivery” logistics hubs.    
   
Coupang said it will continue to contribute to the fight against the pandemic. It created around 20,000 jobs in the first quarter in the face of a national unemployment crisis.   

Joong Ang Ilbo

You can read more at the link.

The future is here and now even the convenience store clerk may become obsolete:

According to Bloomberg, Amazon said it will increase the number of its smart stores to nearly 3,000 across the nation by 2021. This also led GS Retail to launch the first cashierless convenience store here in Sept. 2018 in Magok, western Seoul. Following this, other local retail giants have opened smart stores adopting hi-tech payment systems.

The most prominent example is the GS25 store that opened on the 20th floor of Eulji Twin Tower in Jung-gu, central Seoul, two weeks ago.

There are over 34 smart cameras installed in the store with some 300 weight sensors that all connect to an artificial intelligence (AI) system, which plays the cashier role. 

Cameras watch customers’ behavior and their movement around the store while sensors detect which items they have picked. When a customer finishes shopping, they can just walk out of the store and the payment is processed automatically through a mobile application. 

Despite the convenience, customers are expressing mixed feelings about cashierless stores.

“This is so cool. I don’t have to wait in the queue and I can just grab and go without taking my wallet out of my pocket,” said 31-year-old nurse Lee Jung-soo. “Sometimes I felt sorry for people behind me waiting for me to pay at the convenience store but this new automatic payment system allows me to walk out without stopping.”

However, 35-year-old office worker Kim Jong-bum expressed his discomfort over the move, saying the system could lead to problems involving privacy protection.

“Think about it. Cameras watching you everywhere, anytime. This AI program will first be adopted to convenience stores, then to restaurants and clothing shops. It is only a matter of time until they all connect to put you under surveillance,” Kim said.

Korea Times

You can read more at the link.