Sohn Kyung-shik, chairman of the Korea Chamber of Commerce and Industry, expressed his opposition to forcing large companies to share profits with suppliers by law.

“Everyone agrees that large and small businesses must cooperate, but you can’t force (profit-sharing) by law because each company has its own situation,” Sohn said during a year-end press conference in downtown Seoul on Tuesday.

“Both sides should reach an accord through dialogue. I don’t think it is impossible to come to an agreement.”

Sohn’s remarks came a day after another major business lobby ― the Federation of Korean Industries ― refused to attend a regular meeting on shared growth of small and large companies in protest of forced profit-sharing.
A nongovernmental council on shared growth headed by former Prime Minister Chung Un-chan decided to suspend talks on profit-sharing Tuesday.

The KCCI has both large and small companies as members, while the FKI represents the nation’s largest conglomerates.

Sohn also warned against undue welfare policy pledges by candidates in the upcoming general and presidential elections.

“We have two major elections next year, and rosy campaign promises or unrealistic, excessive welfare policy pledges are undesirable,” he said.

Sohn also called on the government to promptly conclude ongoing negotiations on free trade agreements and seek FTAs with economies of great growth potential such as Indonesia and South Africa. Korea is currently in talks with Australia, Turkey, New Zealand, Canada, Mexico, Colombia and the Gulf Cooperation Council over FTAs.

Sohn said Korea should find ways to minimize damage while achieving mutual benefits in FTA talks with China and Japan. The three East Asian countries are scheduled to complete a joint study on a trilateral FTA and begin negotiations in the first half of next year.

The KCCI chief reiterated his position that the government should stick to its planned corporate tax cuts to keep up corporate activity amidst an economic slowdown, and added that Korean high-income earners were already paying higher taxes than Americans.

“People talk a lot about Warren Buffett who pays 16 percent (of his income) to taxes,” Sohn said.

“Our high-income earners pay much more in taxes for their dividends and comprehensive income taxes.”

Sohn stressed that to perk up domestic demand, the bill on the establishment of for-profit hospitals should be passed and regulations on the service sector should be eased. He also noted that measures to stimulate the construction market were necessary.

By Kim So-hyun (sophie@heraldcorp.com)