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(Yonhap Interview) Minister says smaller firms should play key role in inter-Korean projects

All Headlines 10:09 May 10, 2018

SEOUL, May 10 (Yonhap) -- South Korea's minister for small and medium-sized enterprises (SMEs) has said smaller companies should play a leading role in economic cooperation between the two Koreas amid growing hopes for cross-border projects after their two leaders' historic summit last month.

Hong Jong-haak said he has been asking the government to give 80 percent of the business projects to smaller firms so that they can earn corresponding profits.

The progressive economist and former lawmaker was appointed to head the newly created Ministry of SMEs and Startups in November last year as part of South Korea's efforts to level the playing field for smaller companies in a country that has been dominated by conglomerates for decades.

"Contracts for major projects, such as those dealing with electricity or railways, will be clinched by conglomerates, but it will be the smaller firms who will actually go and work," Hong said in an interview with Yonhap News Agency at his Seoul office on Wednesday.

Taking the forestation project as an example, he said "it will be the smaller firms who will actually go and plant trees."

Earlier, Prime Minister Lee Nak-yon said forestation is one of the cooperation projects South Korea can pursue with North Korea regardless of international sanctions on Pyongyang.

Mountains in North Korea are believed to have suffered severe deforestation, especially since famine swept through the impoverished nation in the 1990s, when people cut down trees for fuel and to extend farmland.

North Korea has been hit by devastating floods in recent years due in part to deforestation.

Hong said North Korea's plan to boost light industry is also in line with South Korea's push to nurture smaller firms.

The ministry is keeping its eyes on the unfolding situations surrounding the Korean Peninsula as the projects aimed at improving inter-Korean relations could be subject to U.N. sanctions on the North.

Last month, South Korean President Moon Jae-in and North Korean leader Kim Jong-un held talks at the border village of Panmunjom and reached an agreement on a wide range of measures to ease tensions and boost ties, including complete denuclearization of the peninsula.

Part of the joint declaration was to set up a liaison office in the North's border city of Kaesong to smoothly ensure civil-sector exchanges and cooperation.

"The economic cooperation between the two Koreas will be a huge opportunity for smaller firms," Hong said.

Small and Medium-sized Enterprises (SMEs) and Startups Minister Hong Jong-haak speaks during an interview with Yonhap News Agency at his office in Seoul on May 9, 2018. (Yonhap)


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