[EDITORIALS]Less Intervention Is Key to ReformJin Nyum, Deputy Prime Minister and Minister of Finance and Economy, recently said, "The government is reappraising business-related regulations that were established during the foreign exchange crisis." Considering that excessive government intervention and control of business activities have sapped our economy, such a move seems appropriate, though belated. Since Mr. Jin has emphasized loosening regulations on companies since the beginning of his term without any visible outcome, we urge the government to bring its efforts to fruition.
In October, the government announced that 7,109 business regulations were in effect in Korea. The government must review all of them thoroughly in the interests of reform. As well as the demand by business to expand guarantee limits for subsidiaries of large trading companies operating overseas, the government should also consider providing tax benefits to companies engaged in merger activities and streamlining systems to shut down insolvent divisions. Laws that directly impact company operations, especially labor regulations, should be revised to reflect reality.
But what is more important than such changes in the law is changing the attitude of politicians and some government organs toward business. The International Institute of Management Development, a Swiss-based management school, recently rated Korea as having a low level of business efficiency due to excessive government control. The government must thus seek to minimize its "invisible intervention."
The government should commit itself to market principles and realize that public confidence cannot be regained without wiping out speculation that politics govern economic policies.
Yet, such moves should never weaken or degenerate corporate efforts to improve company structures and constitutions, the most important economic policy task of today. Furthermore, it is dangerous for the government to take credit for loosening regulations on business with an eye on the upcoming elections, as some already suspect is the case.