[Editorial] Added risks

South Korea’s economy involving the capital market averted shocks in September as the Federal Reserve again delayed its policy to raise the key interest rate. But the US monetary issue still remains a big uncertainty for the local market.Further, two more external factors are aggravating uncertainty at the start of the fourth quarter: the crude oil issue centered on production in the Middle East and the Deutsche Bank woes in Europe.Earlier this week, the Organization of Petroleum Exporting Count

Sept. 30, 2016

[Editorial] Unbearable pain

The US is putting pressure on North Korea on several fronts, including military deterrence. Such efforts should be expedited and encourage other members of the international community to follow suit. Real deterrence against the North -- which even threatens a nuclear strike on the continental US -- should involve Washington and its allies South Korea and Japan making sure the fanatic rogues in Pyongyang do not even consider such provocations. The US, which sent B1-B supersonic bombers to South K

Sept. 29, 2016

[Editorial] Transportation setback

The joint strike by railroad and subway workers across the nation is raising concerns about disruptions to logistics and transport. In protest against the government-led performance-based pay system, unionized workers of the railway and subway sectors launched a simultaneous walkout earlier this week. It marked the first time in more than 20 years that the two sectors’ employees had gone on a joint strike.A union leader from the railway industry claimed that the state-controlled railroad operato

Sept. 28, 2016

[Editorial] Politics in disarray

The parliament’s passage last week of no-confidence vote against the agriculture minister leaves several things to ponder. First, the opposition-led vote against Kim Jae-soo was the first event at the 20th National Assembly in June that made everyone -- from the president, ruling and opposition members to the public -- realize the cold political reality: The parliament is controlled by opposition parties. The no-confidence motion, proposed by the main opposition Minjoo Party of Korea and the min

Sept. 27, 2016

[Editorial] Third-tier lending

Aside from lending from the first-tier banks and secondary financial firms, the loan issuance balance from private moneylenders is rapidly increasing. This indicates that South Korea has become a “debtor republic.”According to the Financial Services Commission, the outstanding loans issued by the third-tier lenders came to 13.2 trillion won ($11.9 billion) at the end of 2015. This marked a 7.3 percent increase from 12.3 trillion won at the end of June 2015.Considering the lending rate charged by

Sept. 26, 2016

[Editorial] All too familiar

The scandal involving President Park Geun-hye and two recently established nonprofit foundations follows the same pattern as similar past cases: Media critical of the president raise allegations, opposition members play up and reproduce them and the issue becomes a hot political dispute -- regardless of the veracity of the allegations.  In the initial stages, presidential officials come forward to deny the allegations, with the president maintaining her distance from the issue. If necessary, she

Sept. 25, 2016

[Editorial] Starting line

The local financial market is about to see a big bang in commercial banking thanks to the emergence of fintech, which refers to the convergence of finance and technology.Like major developed countries, information technology-based financial services are still unfamiliar to most Korean consumers as the infrastructure has yet to be established in the country.However, when market share competition starts, the speed of innovative financial products’ penetration into ordinary consumers’ daily lives m

Sept. 23, 2016

[Editorial] Too vulnerable

Until recently, natural disasters usually meant floods, typhoons and droughts for modern-day Koreans. For many, the thought of encountering a devastating earthquake never occurred to them. This public sentiment -- that Korea is safe from catastrophic underground tremors -- has changed a lot since a 5.8-magnitude earthquake jolted the Gyeongju area on Sept. 12. The temblor, the strongest ever on government record, was preceded by a 5.1-magnitude quake and was followed by more than 400 aftershocks

Sept. 22, 2016

[Editorial] China’s double face

The case of Liaoning Hongxiang Group, a Chinese conglomerate suspected of engaging in banned business activities with North Korea, is yet another piece of evidence that China is allowing loopholes to develop in the UN-led sanctions against the North’s nuclear and missile provocations. According to a South Korea-US joint study, six subsidiaries of the Chinese conglomerate have transacted with sanctioned Burmese and North Korean entities, have been associated with North Korean cyber operators, and

Sept. 22, 2016

[Editorial] Ailing competitiveness

A council on the international finance sector development kicked off with its first meeting convened this week, including panels composed of government officials, professors and economists. It aims to increase the nation’s ability to cope with rapidly changing global indices.Its establishment is laudable amid the volatility of global indexes, a series of negative external factors and mounting uncertainties in financial markets.Local market participants are pinning hopes on the council in terms o

Sept. 21, 2016

[Editorial] Strike season

Concerns are mounting as workers in the financial industry are poised to stage an all-out protest. Employees from some other public sectors including railways, subway lines and hospitals will follow suit in the form of a general strike against the government’s scheduled introduction of performance-based pay scheme.The Korea Financial Industry Union has already publicized its strike plan in which a dominant portion of its unionized workers will participate in the walkout this Friday.As about 100,

Sept. 21, 2016

[Editorial] Construction-led growth

With exports on a downward spiral, Korea’s economic growth is increasingly being led by the construction industry. Policymakers need to take action to correct this abnormal growth pattern.A report released by the Korea Institute for Industrial Economics and Trade showed that the construction sector accounted for 51.5 percent of the country’s economic growth in the second quarter. Of the economy’s 3.3 percent expansion in the April-June period, 1.7 percentage points came from brisk construction i

Sept. 20, 2016

[Editorial] Fight against cancer

The Ministry of Health and Welfare has recently finalized the third five-year National Cancer Management Plan, which is aimed at improving the quality of life of cancer patients and expanding the government’s role in fighting cancer.　The survival rate of cancer patients in Korea has dramatically improved in recent years thanks to increased efforts for early detection of cancer and advances in cancer treatment. 　The five-year survival rate for people diagnosed with cancer between 2009 and 2013 wa

Sept. 20, 2016

[Editorial] No more words

On the surface, China seems to be fulfilling its obligations as a member of the international community and a key player in dealing with North Korea’s latest nuclear and missile provocations. The Beijing government departed from its usual tepid attitude by joining the international community’s condemnation of the North after it detonated its fifth nuclear bomb Sept. 9.A permanent member of the UN Security Council, China agreed to a statement which called for the council to take “further signific

Sept. 19, 2016

[Editorial] Lost mandate

South Gyeongsang Gov. Hong Joon-pyo is well known for his self-righteousness and freewheeling style. He often draws public attention for his irreverent behavior and controversial remarks. So it hardly comes as a surprise that he refuses to resign as governor despite a court ruling earlier this month that found him guilty of taking illegal political funds. To make matters worse, while handing out an 18-month prison term, the court did not take him into custody, citing his status as a serving gove

Sept. 19, 2016

[Editorial] To be productive

This year’s parliamentary audit, which will mark the first conducted under the 20th National Assembly, is scheduled to begin Sept. 26 for a three-week run.Wordy warfare between the ruling and opposition parties will likely intensify over the issue of the US and Korean governments’ accord to deploy the Terminal High Altitude Area Defense on the peninsula and North Korea’s fifth nuclear test earlier this month.Rival parties have also been at loggerheads over whether to question Woo Byung-woo, a pr

Sept. 18, 2016

[Editorial] FOMC week

After the five-day Chuseok holiday, the local economy and financial markets will face significant external influence from the US in the form of a decision to be publicized here Sept. 22. If the US Federal Reserve keeps its base rate untouched again during the gathering of the Federal Open Market Committee, slated for Sept. 20-21, South Korea’s policymakers might be given more time to boost the economy in the fourth quarter.Some foreign investment banks even predict the Bank of Korea could choose

Sept. 18, 2016

[Editorial] Nature’s warning

The strongest earthquake yet that hit the country Monday night is a reminder that this land is not safe from the curse of a major earthquake or other major natural disasters. It is fortunate that there have been no reports of casualties or major property damage, but what the nation experienced overnight was sufficient to urge the government and the public to raise their awareness of the danger of earthquakes. The 5.8-magnitude tremor, which was centered in the southeastern city of Kyeongju, was

Sept. 13, 2016

[Editorial] Real deterrence

On many counts, North Korea’s fifth nuclear test last week means that the world now faces the worst-case scenario: North Korea has -- or is very close to having -- the capability to launch a nuclear strike. The latest blast, which Pyongyang claimed was a “warhead,” was the most powerful yet -- experts estimate it at a force of at least 10 kilotons of TNT -- and it came only eight months after the previous detonation. Moreover, the test came as the North is in what seems to be the final stage of

Sept. 13, 2016

[Editorial] Kia’s plant in Mexico

Kia Motors has built a new production facility in Mexico, securing a base for its advance into North and South American markets.　The $3 billion plant is Kia’s fourth overseas production facility, with the three others located in China, Slovenia and the United States. It is capable of producing 400,000 cars per year.　With the new factory in Mexico, Kia‘s overall production capacity came to 3.56 million vehicles per year. Notably, the Mexican plant boosts the company’s overseas production capacity

Sept. 12, 2016