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(EDITORIAL from Korea Times on April 8)

All Headlines 07:13 April 08, 2016

Samsung blues

No surprise if one heard Corporate Korea's collective sigh of relief about Samsung Electronics' first-quarter performance that beat market forecasts. That is clearly good news but it is also true that it is taken with a dose of reflection and concern.

This reaction of emotional ambivalence is caused by what the nation's largest chaebol stands for, not just about its family-oriented governance or the Republic of Samsung, as foreign media would aptly point out.

It is the nation's overdependence on one conglomerate, to the point that any woe befalling it would come back to haunt the nation's economy. First, congratulations are in order to Samsung for posting 6.6 trillion won in operating profit, up 10.37 percent from the same quarter a year ago. This stellar performance is due to the popularity of its latest smartphones ― Galaxy 7 and Edge ― which are selling well, thanks to the waterproof feature, among other things. However, the two latest gadgets put a damper, whether temporary or not, on the pessimistic future of smartphones as we know that, by many indications, they are made too readily available in similar models.

The reason why this good news cannot be entirely happy news is that Samsung also reflects a mistake at the national level, that is, something like putting all one's eggs in the same basket. In other words, if Samsung falls, the nation falls.

It is also the pride of the nation internationally, competing with Apple and being the No. 1 chip maker in the world.

Although Samsung cannot be singled out for being responsible for the underperformance of small and medium companies, it is true that the country has been a poor breeding ground for small and medium enterprises (SMEs) in an economy dominated by a few big companies.

If Korea joins the ranks of the truly developed countries, efforts should be made relentlessly to foster a healthy corporate forest where not only giant trees like Samsung but also small but strong firms compete with and help each other under the rule of fairness and the spirit of compassion for mutual growth. That is the way that Korea Inc. can prosper, and it will prevent us from losing or gaining a heartbeat because of Samsung's performance. We need a strong Samsung and an even stronger army of SMEs.
(END)

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