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[EDITORIALS]No leaders, no growth

Published: 08 Nov. 2005, 21:59

Samsung Group has decided to invest 47 trillion won ($44.8 billion) in research and development over the next five years. The amount is equivalent to double the investments the conglomerate has made for the past five years. The group also came out with a blueprint for doubling the current level of sales revenue and profits by 2010.
Announcing its management initiatives for the future with a major focus on technologies, Samsung said it would be “devoted to innovative research and development activities to survive in the global competition of the 21st century.”
The Korean economy has been suffering from enervation for a long time. Many people have been looking forward to growth, but facilities investment and potential growth rates have gone down, not up. In addition, a negative investment psychology is making it harder for the economy to recover. The government, the ruling party and local businesses have criticized each other; large conglomerates blamed government regulations, while the government and the party in power argued that the lagging economy came from the conglomerates’ sabotage.
We see no future for our economy unless the potential growth rate and production capacity are stepped up. The major focus should be expanding facility investment. We have observed clumsy defenders of wealth distribution disrupting the nation’s economy over the past several years. An economy staying still actually means it is lagging behind in the fierce international competition. Not even survival is guaranteed in this competition without innovative technology development and massive investment. The conglomerate has volunteered to serve as a front-runner in technology innovation.
Samsung’s plan to post 27 trillion won in sales and 30 trillion won in pretax profit is not to be achieved solely by its willpower. The goal will be met only when the company ranks among the top three electronics makers in the world. Samsung will also have to win in a head-on rivalry with global brands such as GE, IBM, Intel, Microsoft and Nokia. Cutting-edge core technologies, excellent human resources and world-class management will be required.
Korea has been called the “Republic of Samsung” by some critics. Those critics may find fault with its newest initiative as well. But for the nation to become first-class, it should have many first-class companies. Not many advanced countries could have made their economic achievements without hosting the world’s leading companies.
We hope that the new challenges that Samsung is facing will revitalize the nation’s economy and usher in a new era of an advanced economy.