[NOTEBOOK]No Clear Message to Business

It started with a high-ranking Millennium Democratic Party lawmaker in charge of policy-making and coordination, Kang Un-tae, who said on May 3 that four industries － construction, marine shipping, air cargo and general trading － would be made exempt from government guidelines on corporate debt that limit corporate borrowings to 200 percent of equity.

As if to back up the lawmaker's statement, Deputy Prime Minister Jin Nyum said the next morning at a gathering of business leaders that the government would conduct "a comprehensive review of the various regulations placed on corporations after the financial crisis."

The business community was getting excited. With the economy in shaky condition, it seemed to businessmen that government leaders were finally allowing them breathing space to invest. The mood seemed to be taking further hold last Monday when, at a workshop attended by the MDP's Supreme Council members, there was talk of "refurbishing reform policy" and an apparent readiness to lift restrictions as a part of a political solution to the deepening sense of reform fatigue being felt among the public.

The same day, the president of the Korea Chamber of Commerce and Industry said, "It will suffice just to get on with administering the existing reform programs rather than coming up with additional goals of reform."

A think tank affiliated with the Federation of Korean Industries took issue with the fair trade law provision which restricted large companies from acquiring more than 25 percent of the owners' equity as stakes in affiliated companies. Laws should be changed to create a framework in which companies can compete freely, the Korea Economic Research Institute said.

But the next day, Tuesday, the presidential office made an apparent about-face. The chief government antitrust regulator, Lee Nam-ki, and the senior economic secretary to the president were unified Wednesday on the need to push through corporate restructuring without interruption.

Mr. Lee, the Fair Trade Commission chairman, even called in reporters to insist that there could be no change in the special restrictions on the top 30 business groups and the ceiling on equity ownership in affiliates.

The senior presidential secretary for economic affairs, Lee Ki-ho also told a gathering of foreign businessmen that the government would continue to reform corporate governance － an ominous prospect for business.

But on Thursday afternoon, Representative Kang again made some comments contradicting those of the president's office and the Fair Trade Commission, saying, "The restrictions on debt ratios and equity ownership should not be applied rigidly to profitable companies which have interest coverage ratios greater than one," he said.

No wonder the business community is confused. All this talk is stalling investment decisions. Businessmen are weary.

－ The writer is an economic news reporter of the JoongAng Ilbo.

by Song Sang-hoon