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(LEAD) Park reiterates commitment to supporting midsize enterprises

All News 16:53 July 22, 2016

(ATTN: CHANGES photo, headline, lead; UPDATES throughout with Park's remarks)
By Song Sang-ho

SEOUL, July 22 (Yonhap) -- President Park Geun-hye on Friday reiterated her commitment to supporting midsize enterprises, saying her government will spare "no efforts" to build them up as key growth driver for Asia's fourth largest economy.

During a luncheon meeting with the chiefs of some 140 midsize companies, Park also said that the government will continue to address "unreasonable problems" confronting local businesses, such as excessive regulations cited for undermining competitiveness.

"The government will push to address unreasonable problems such as regulations for large conglomerates that have also been applied to midsize firms because of the fact that they have grown a bit in size," the president said.

"The basic purpose (of deregulations) is to help midsize firms, which target the global market, create new growth industries and good-quality jobs, although some are concerned about the side effects of deregulations," she added.

A midsize firm refers to an enterprise that has more than 500 billion won (US$440 million) in overall assets, hires more than 1,000 permanent workers and earns an average of 150 billion won a year in sales over the past three years.

Over the last several years, the government has been seeking to address the so-called "support cliff," which refers to a situation in which midsize firms are weaned off from government support and face increased regulation after their emergence from the ranks of small businesses.

The government has rolled out some 50 measures in recent years to help midsize firms bolster their research and development activities, increase trade and establish wider sales networks, the chief executive pointed out.

Touching on the achievements of her recent trip to Mongolia, Park expressed hope that her "economic diplomacy" would help pave the way for midsize enterprises to make advances into the global market.

During her visit to Ulaanbaatar, the two countries reached an agreement to seek South Korea's participation in 14 large scale projects being pursued by Mongolia, including a series of infrastructure programs to build power plants and railways. The projects are estimated to be worth US$4.49 billion in total.

"The reason why we are implementing our policy to support midsize firms and foster Korean hidden champions is to overcome the limits of the domestic market by advancing into the global market, create good-quality jobs and achieve sustainable economic growth," Park said.

Hidden champions refer to small yet competitive companies that are not well recognized by the general public, but are leading global industry sectors in their own specialty areas.

The luncheon gathering was also attended by Finance Minister Yoo Il-ho, who doubles as deputy prime minister for economic affairs; Trade, Industry and Energy Minister Joo Hyung-hwan; and Small and Medium Business Administration chief Joo Young-sup.


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