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Korea urged to 'treat foreign business equally'

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Seoul ranked 36th out of 112 cities in the Global Financial Centers Index published by the London-based think tank Z/Yen last week. / gettyimagesbank
Seoul ranked 36th out of 112 cities in the Global Financial Centers Index published by the London-based think tank Z/Yen last week. / gettyimagesbank

By Kim Bo-eun

Korea needs a level playing field to attract more financial experts from around the world and transform Seoul and Busan into international financial centers, Mark Yeandle, lead author and co-creator of the Global Financial Centers Index, told The Korea Times, Wednesday.

He pointed out that Korea's financial centers lack competitiveness because of an unfriendly business environment.

"The business environment is currently the most important. Korea suffers from a business environment that needs improvement," Yeandle, director of Z/Yen Group of Companies, said in an email interview.

His advice came after London-based think tank released its 2019 Global Financial Centers Index a week ago.

Mark Yeandle, director of Z/Yen Group of Companies
Mark Yeandle, director of Z/Yen Group of Companies
According to the report, Seoul's ranking dropped to 36th from 33rd in September 2018. The index is published in March and September every year. Busan's ranking as the country's second financial center also dropped, to 46th from 44th.

The index was established to provide evaluations of competitiveness and rankings for 112 global financial centers based on five key factors ― business environment, human capital, infrastructure, financial sector development and reputation ― through 2,373 online surveys.

"If you want to create an international finance center you need to attract international people. In order to do that you need to treat everyone equally and be welcoming to foreigners," Yeandle said.

"However, the people who completed our questionnaire do not find Korea a very welcoming country."

According to the report, factors affecting the business environment are political stability and rule of law, the institutional, regulatory and macroeconomic environments, taxes and cost effectiveness.

The report said "the level of corruption and the rule of law are significant factors in a financial center's competitiveness."

"Seoul is 62nd out of 102 financial centers in the corruption perceptions index published by Transparency International," Yeandle said.

Other areas he referred to Korea having room for improvement included tax as a percentage of GDP, as well as bilateral tax information exchange agreements.

Seoul also did not make it into the top 10 financial centers in the Asia-Pacific region, ranking 13th; and was not included in the list of 15 the report cited as considered "likely to become more significant."

Experts here have pointed out that Korea creating an additional financial center in Busan when the first one in Seoul already lacked competitiveness is one reason neither of the cities is faring well.

Controversy is growing over a government plan to create a third financial center in the city of Jeonju ― a project that seems more likely to be a regional development scheme.

The Moon Jae-in administration has been criticized for its lack of policies focused on further fostering the financial sector.

The index's top five cities were New York, London, Hong Kong, Singapore and Shanghai.


Kim Bo-eun bkim@koreatimes.co.kr


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