Subscribe
E-Paper
 |
This is the final of a three-part series highlighting economic pledges of the two most prominent presidential candidates, Moon Jae-in of the Democratic Party of Korea and Ahn Cheol-soo of the People's Party. ― ED.
Two candidates differ on how to bring fair competition
By Lee Hyo-sik
Presidential hopefuls have been scrambling to garner the backing of small businesses, which employ 87.9 percent of Korea's salaried workers, by making lofty promises for a better future.
In particular, the two frontrunners, Moon Jae-in of the Democratic Party of Korea (DPK) and Ahn Cheol-soo of the People's Party, are actively courting small business owners and their employees amid the increasingly competitive May 9 presidential election.
Both Moon and Ahn have said they will place higher policy priority on supporting small- and medium-size enterprises (SMEs) than family-controlled conglomerates if elected as the next president.
They say the Korean economy, the fourth-largest in Asia, should be propelled by small businesses, which account for 99.9 percent of corporations in terms of numbers.
However, the two differ in their opinions about how to achieve the goal.
Moon says the government should be in charge of nurturing SMEs, while Ahn, a successful entrepreneur before becoming a politician, has been arguing that the government should limit its role to creating an optimal market environment and let the private sector take care of business.
On Monday, Moon visited the Korea Federation of Small and Medium Businesses (K-Biz) on Yeouido, promising to make things better for small companies if he takes Korea's highest public office.
"SMEs employ 88 percent of salaried workers and account for 48.3 percent of the nation's gross domestic product. They are the backbone of our economy," Moon said. "I will do everything I can to enable small businesses to exert their full potential and remove any obstacles blocking them from doing so. I will ensure the fruits of economic growth are shared by small firms and their members."
The former presidential chief of staff to the late President Roh Moo-hyun pledged to create the "Ministry of Small Business and Venture" to supervise his administration's policies concerning SMEs and startups. Moon also said he will double the state research and development (R&D) budget for small companies.
He promised to expand financial support to those hiring new workers. Under Moon's plan, if small firms recruit three new workers, the government will pay the wages for the third worker for three years.
"The government will pay wages for 50,000 people each year as small companies hire 150,000," Moon said. "Korea should reduce working hours while bolstering worker productivity. Many studies show that when employees work less, their productivity goes up. The shorter working hours would not necessarily burden employers."
The DPK standard-bearer also said he will more harshly penalize large companies abusing their small subcontractors through dubious business practices.
"Under the law, small firms can sue their larger business partners for money in punitive damage if they are unfairly treated. I will further strengthen the law to make it more financially costly for abusers."
‘Let private sector do work'
Ahn seems to agree with Moon on most of SME policies. But the lawmaker differs in methodology as he believes that the government should play only a supporting role.
"Korea needs to abandon the current government-led SME policy stance," Ahn told K-Biz members Tuesday. "With the Fourth Industrial Revolution in full swing, the government's role should be to create a market environment where the private sector takes the initiative to foster small businesses and startups. If I become the president, I will change the current policy approach."
He said the government-led economic policies cannot enable Korea to tide itself over the tight labor market, the sluggish domestic demand and other difficulties, adding that policymakers should help companies enhance their core competitiveness rather than tell them what to do.
"What the government needs to do is to build a robust and fair marketplace for private firms so that they can compete and foster innovation," Ahn said. "My administration will set up an institutional framework under which those who have failed to get a second chance can try again."
He also said his government will expand investments to nurture talented workers and advance technological prowess, adding that it will strengthen the role of the Fair Trade Commission (FTC) to create a fair market environment.
"I will ensure the FTC's independence by guaranteeing the tenure of its chairman," he said. "I will also establish a state R&D center exclusively for small businesses and startups, and extend a 500,000 won ($442) allowance each month for two years to those finding jobs at SMEs."
