[EDITORIALS]Let’s see real deregulationIn a meeting with foreign chief executive officers based in Seoul, President Roh Moo-hyun pledged to review 8,700 regulations and remove those which can be removed. He said the government will reduce the time and cost of the administrative process for doing business in Korea. We found it highly welcoming to see the president address the matter directly to business people.
There has not been one president who has not emphasized the importance of deregulation. Despite that, South Korea is still considered a department store of regulations. The government’s say in founding, adding or expanding existing business and investment, is still strong.
The president said there are 8,700 regulations, but businesses feel that there are a lot more than that. The Federation of Korean Industries said 202 rules have been added recently.
The reality is harsher. The administrative cost of building a small or medium-size factory, on farm land outside the Seoul metropolitan area, is estimated at 150 million won ($135,000). The total time needed is estimated at six months.
Such a plan would also face 68 regulations spread among the ministries of environment, commerce, industry and energy, construction and transportation, agriculture and regional governments. So anyone looking to build such a factory would have to personally visit these various ministries to obtain the necessary permission.
In the process, the hands of government officials will need greasing. As a result, it is difficult to expect businesses to want to invest in the country.
The business environment and the competition businesses today face have greatly changed. Accordingly, the government should think about changing the regulations to adapt to the different environment. The government should not tie the hands of businesses but must let them proceed. What the government can do is to clamp down on irregular activities and on anti-fair trade practices.
The government says it is reviewing all regulations from scratch. With the president having declared his desire to lift regulations for businesses, we would like to see some changes this time around.
Surely, this is the way for businesses to survive, for investment to pick up, for the economy to rebound and for the country and the people of this country to prosper.