Chaebol must be broken up if Korea is to progress

From Alan Plumb, Chairman, Abicomms Co, Seoul, Korea

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Sir, Simon Mundy is right to point the finger of blame at the chaebol as the reason the Korean tiger is wounded (“Sparks fly over the chaebol”, The Big Read, November 3). They were formed to create the industries that have been the backbone of the development of the Korean economy as it is today. But they are no longer relevant or appropriate for the next stage of Korea’s development as an advanced economy. This requires smaller, less capital-intensive businesses, which are led by a new breed of entrepreneur, and are more likely to be in the service than the manufacturing sector. This will not only harness the creative and innovative minds of today’s younger Koreans, as President Park Geun-hye has called for, but will offer more employment opportunities to the country’s highly educated young people.

The chaebol must, therefore, be broken up, with the viable and valuable businesses within them pruned and refashioned by a new breed of forward-looking professional managers, appointed by the shareholders for their skills not their family connections. It is time for the shareholders to act, and, in many cases, the majority are not Korean.

Alan Plumb

Chairman, Abicomms Co,

Seoul, Korea

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