[EDITORIALS]Lessons from ChinaBlue Star, or Lanxing Group, a Chinese petrochemical industry-based conglomerate, has been chosen as a priority negotiating partner for the sale of Ssangyong Motor Co. If the negotiations proceed smoothly through the procedure of actual inspections, Lanxing Group will be the new owner of Ssangyong.
It is the first time that a Chinese business has reached out to acquire a leading Korean business. It gives an impression that Chinese capital has started to flow into the Korean market. Seeing how South Korea and China have suddenly reversed positions, we cannot help but have mixed feelings.
When the diplomatic relations between South Korea and China were established in 1992, South Korea was a successful country. Chinese civil servants rushed to Seoul to learn the secrets of Korea’s economic success, advanced technology and know-how in managerial skills.
After a little more than 10 years, the position of the two countries has been completely reversed. China has emerged as a new economic power; meanwhile, the Korean economy has hit the ground with a thud.
What is behind the Chinese transformation? Under strong leadership, the government and the people worked together to revive the economy. China did not spare any efforts to invite foreign investment. Last year, China attracted $57.8 billion in foreign investment, the largest in the world, and became the second largest foreign exchange holding country after Japan.
But Korea failed to pull itself together even after the foreign exchange crisis in 1997. Economic vitality is lost in the middle of endless political conflicts and labor struggles. It is in a crisis, where the rate of unemployed youth runs up to 8 percent, credit delinquents are over 3.6 million, the middle class has collapsed, the gap between the rich and the poor grows bigger and investment shrinks.
Due to confusion and absence of political leadership, the whole society is in limbo. There is no future for Korea, if things go on this way. The political community, the government, the management and the labor must work together