LTW - Summit, Dust, World Bank, & Overtime Cut

1. National
   1) Nuclear Security Summit held in Seoul

The 2^nd Nuclear Security Summit was held at COEX Center in Seoul, just 2 km from where I live, with the leaders of 53 nations attending the summit. While the leaders unanimously adopted a communiqué that encourages nations to take all possible steps and cooperate to secure vulnerable weapons-grade fissile material by 2014, critiques said no progress has been made in reality in terms of reducing nuclear materials and that the communiqué is no significant improvement over commitments made during the first one in Washington in 2010 where the U.S., Russia and China agreed to reduce nuclear materials equivalent to 20,000 nuclear weapons and actually lowered to 3,000. The third summit will be held in Netherland in 2014.

While in Korea for the summit, Obama made a visit to DMZ, gazing at North Korean soldiers a few hundreds meters away. Obama thus became the 4th U.S. president to visit DMZ after Ronald Reagan (1983), Bill Clinton (1993) and George W.Bush (2002). The U.S. solider next Obama was in efforts to make sure no microphone was turned on while Obama was pouring colorful F words at Kim Jong-un across the border.

  2) Yellow dust season started

Just as two Metaldyne engineers arrived in Korea for a meeting with Hyundai last Wednesday, the sky turned yellow as this is the time of year when yellow dust from Mongolia and China blow east to cover whole Korean peninsula. Concerns are the sandstorms are occurring more frequently as the regions that generate the yellow dust are experiencing increased desertification as a result of industrialization and logging. In the 80’s, yellow dust hit Korea for an average of 3.9 days, while in the 90’s, it jumped to 7.7. From 2000 to 2011, it increased to 11.8 days. The worst that I have seen was 2006 when most of the schools were closed for a couple days due to thick dust.

While Koreans suffer from sore throats due to jet stream blowing from China to Korea, Koreans should not complain too much about it. If the jet stream blows the other way around, Koreans would be soaked with nuclear dust from Fukushima by now.

2. Economy
 1) A Korean-American nominated as the head of World Bank

Koreans got excited at the news that Obama nominated Korean-born Jim Yong Kim, president of Dartmouth College, to lead the World Bank. Born in Seoul in 1959, Kim moved to the U.S. at the age of five, and got an M.D. degree and a Ph.D. in anthropology from Harvard. Before going to Dartmouth in 2009, Kim was the director of the WHO’s HIV/AIDS department. While the new leader to replace current Robert Zoellick will be selected in the IMF meeting in April, the U.S. nominee gets the job traditionally. Kim arrived in Korea last week, and met with President Lee Myungbak.

It seems Koreans now have accomplished what Genghis Khan had once dreamed about 800 years ago as an Asian. Ban Ki-moon is leading the world politics as the leader of United Nations. Jim Yong Kim will dominate the world money market. Kim Jong-un scares the hell out of the whole world just by toying with nuclear missiles, to top it off.

3. Auto Industry
 1) Government push to cut overtime

According to OECD, Koreans are the busiest bees, working 2,193 hours a year, including overtime, as of 2010, becoming the only OECD nation in which people work more than 2,000 hours. Dutch people work 1,377 hours while industrious Germans toil 1,419 hours, just for comparison. To create more jobs under “job sharing” program, the government is modifying labor laws so that working on holidays is included in overtime as holiday working is currently not included in extended working hours. Under the current labor law, employees are to work maximum overtime of 12 hours a week. If the law is changed to the way the government wants, the companies either have to stop production on weekends or add third shift to run 4 days on 3 days off mode, hiring one third more work forces. Auto industry, which is running full capacity these days, has the most to lose if the new law is enacted.

While business leaders are dead against the new law as it would be a huge financial cost to add one third more people, the workers also do not welcome the new law as their income will be reduced without overtime. Here is what people in the auto industry say to the government. “You are helping me a lot if you do not help me.”

2) Fire in a supplier stops Kia Georgia plant

Kia’s West Point plant in Georgia had to shut down because of a fire at Daehan Solution’s plant nearby on Mar 17. The plant was manufacturing headliners, floor mats, and other noise absorbing materials for Kia’s Optima, Sorento as well as Hyundai’s Santafe. No casualties, but one of the two Daehan Solution’s plants were completely burned down. Daehan Solution’s solution was immediate airfreight of parts from its plants in Korea, and Kia’s Georgia plant resumed full operation last Monday, just a week after the fire. While the fire was a disaster for Daehan Solution and Kia, it gave some relief to other Hyundai and Kia suppliers who were bleeding from air freight cost due to tight production capacity.

  I fully understand the panic Daehan Solution employees had to go through from the fire as Metaldyne Korea had a similar disaster in Aug 2010 when the roof our plant collapsed from heavy rain. We had to work without roof for two months, covering the production line with giant tents as you see in the above pictures. We managed not to stop Hyundai production even a second, but most of our employees lost average 10% of their hairs from the stress. Our HR manager Ken Lee above was definitely the employee most stressed during that crisis.

Regards,

H.S.