Go to Contents Go to Navigation

(EDITORIAL from Korea Times on May 26)

Editorials from Korean dailies 06:55 May 26, 2023

FKI's comeback
Stop being a conduit for collusion between politicians and businesses

It is hard to find a similar example around the world of a business association like the Federation of Korean Industries (FKI).

The association was established in the 1960s to protect family-controlled conglomerates, or chaebol in Korean, from military dictators. Korea is now a democratic country, but chaebol have never been entirely free from political influence.

The FKI has also served as a link for collusion between politicians and tycoons.

The FKI has laid low in the past seven years since its involvement in the corruption scandal of impeached former President Park Geun-hye. Now, it is trying to come back under another business-friendly president.

At the center of such efforts is its acting chairman, Kim Byong-joon. Last week, Kim unveiled a set of measures for reforming the FKI. Conscious of criticism about the chaebol lobby, he vowed to set up an ethics committee to avoid external interference. Kim also said he would rebrand it as a research-oriented organization, an economic think tank.

The announcement was the replica of its vows in 2017 after the FKI came under fire for collecting money for a foundation related to Park. However, the group has yet to turn such words into action. Few businesspeople believe it will be any different this time around. Nothing shows this better than the reluctance of the four largest chaebol ― Samsung, Hyundai, LG and SK ― to rejoin the FKI they left after the collusion scandal.

It is noteworthy that Kim was the campaign chief of President Yoon Suk Yeol. Yoon said he believes in market principles, promising to give more freedom to businesses. However, the pro-business president also made some moves running counter to his avowed principles. His aides have intervened in appointing the heads of banking groups and KT. Faced with criticism about reviving "government-dictated" financing, Yoon said these private businesses deal in "public goods."

Is Yoon about to strengthen presidential influence on businesses while sloganeering a free economy? We hope not. But some signs are suspicious. Kim organized a 120-strong business entourage for Yoon's visit to the U.S. last month, two to five times larger than previous ones. Few, if any, national leaders accompany such a large group of business executives to summits with foreign counterparts. Moreover, U.S. President Joe Biden steps up America-first economic policies at the expense of allies and their companies. We have yet to hear about the visit's economic benefits.

The chief executive may have good intentions in seeking closer collaboration between the government and businesses by reviving the FKI. But the results are far from desirable from the public's viewpoint.

In March last year, Yoon announced a plan to relocate the presidential office from Cheong Wa Dae to the defense ministry compound. The FKI released a report soon, alleging the relocation would create an economic effect worth 3.3 trillion won ($2.5 billion). Eager to restore its past status, the group's report, devoid of objective grounds and not even calculating cost factors, became the laughingstock of private economists.

Also, the first thing the FKI did upon returning home from the U.S. visit was to conduct a survey. It said three-fourths of Koreans thought the visit was a success, inviting jeers from the public that the FKI was faster than the president's press officers.

The most glaring scene occurred in Tokyo earlier in the month. Sitting with the head of the FKI's Japanese counterpart, Keidanren, Kim brushed aside Korean journalists' questions on the possible participation of the two Japanese firms in a fund for indirect compensation for the South Korean victims of their wartime forced labor. "Such questions will only mar the spirit of this collaborative fund," Kim said.

The president had better think twice. Big businesses' capacities have long excelled over those of politicians and bureaucrats.

Yoon must let Kim go when his interim role ends in August and allow the business community to run around the Korea Chamber of Commerce and Industry as most advanced countries do.

The newborn FKI should devise strategies on global issues, like dealing with the U.S. Inflation Reduction Act (IRA).

Send Feedback
How can we improve?
Thanks for your feedback!