The South Korean government will keep watchful eye on 12 public firms that it selects as the target for debt reduction

November 25, 2013 Leave a comment

Gov’t to put 12 public firms under control list

Shin Hyun-gyu, Chang Jae-woong

2013.11.24 18:13:36

The South Korean government will keep watchful eye on 12 public firms that it selects as the target for debt reduction. The list included 12 public firms – Korea Land Housing Corporation, Korea Electric Power Corporation, Korea National Oil Corporation, Korea Gas Corporation, Korea Railroad Corporation, Korea Coal Corporation, Korea Water Resources Corporation, Korea Rail Network Authority, Korea Expressway Corporation, Korea Resources Corporation, Korea Student Aid Foundation and Korea Deposit Insurance Corporation. The government will closely look into the 12 firms’ debt structures to classify them as faults of the past administration, lax management and expansion of impractical plans. Then, it will disclose those who are responsible for the irregularities to the public. The 12 firms on the list are what the government deems problematic ones whose debt exceeds 20 trillion won ($18.8 billion) and debt ratio surpasses 500 percent.
Deputy prime minister and finance minister Hyun Oh-seok told to the Maeil Business Newspaper’s report Sunday, “we’ve said the party is over. So we expected public firms’ heads to hold responsibility by setting up emergency measure committee, but they didn’t.”
“Public firms’ reform efforts fizzled out so far, so they seem to have no sense of urgency, believing this is nothing but a repeat of an empty rhetoric from a new regime. But this time, that will never be the case,” Hyun added “some firms may cut down on their debt via profitable projects but strengthening fundamentals and ensuring soundness should be their focus from now on.”
The minister stressed “[some public firms] cannot even understand the reason for reducing a sabbatical leave,” noting “public firms with abnormal union negotiation environment will be all disclosed to the public.”
The government’s firm resolve largely came as their combined debt reaches 407 trillion won, accounting for a whopping 85 percent of the nation’s total debt of 480 trillion won.

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