Investment is our best hopeConglomerates in our country reportedly plan to increase investment significantly during the second half of the year.
Hanhwa Group has decided to increase its investment target this year to 1.8 trillion won ($1.49 billion), 12 percent higher than its earlier plan. GS Group has also planned to increase investment for this year to 2.3 trillion won, 10 percent more than last year.
LG Display has decided to invest 3.27 trillion won to build more production lines for LCD TVs. SK Group has decided to spend 1.3 trillion won this year on research and development, while Samsung Electronics plans to invest 500 billion won over five years to develop pharmaceuticals.
It is truly good news that major conglomerates have decided to increase their investment, because corporate investment is a decisive factor in restoring the economy and creating jobs. The government encouraged and urged these companies to invest aggressively, but until now they had not moved an inch.
Now they have voluntarily made the decision, because their business in the first half of the year improved more than expected and they see the possibility that the economy may be restored in the second half of the year.
Investment is meaningful for many reasons, as it accounts for a large part of domestic consumption, contributes to the recovery of economy and serves as a foundation for growth.
In the first half of this year, our economy stayed afloat thanks to the government’s stimulus expenditures and improved exports, despite decreased corporate investment. But in the second half of the year, the government has not had much room to expand its spending, and the outlook for exports is uncertain.
As household consumption has shrunk considerably as a percentage of domestic consumption, investment is the only factor we can rely on.
Under these circumstances, it is truly timely that major conglomerates have decided to invest more once again.
We believe that the government cannot persuade or force companies to make investments. That’s why the conglomerates made the decision based on their own judgment.
These large business groups’ pre-emptive investments are being made to take advantage of opportunities for the future. They should never release plans for expanded spending simply because they have been forced to do so by the government.
We hope that the investment by these conglomerates will lead other companies to make similar moves. The government must also work more actively to maintain an atmosphere suitable for investment.