Monday, January 28, 2013

LTW - Thick Glass Ceiling, Minor Baby Boom, & NK Anger

1. National
1) North Korea in anger over a slap in the face by UN
Just hours after the UN Security Council’s unanimous decision to sanction North Korea over a rocket launch in Dec, North Korea vowed to boost its nuclear program. North Korea said there will be no more denuclearization talks “due to the U.S.’s worsening hostility toward North Korea.” North Korea also lashed at China for its agreement on the UN sanction by saying “ Big counties had been pressured by the U.S. and relinquished basic principles that must be protected.” It has threatened “strong physical countermeasures” against South Korea if Seoul directly takes part in the sanctions. A report from Johns Hopkins University said North Korea’s third, Kim Jong-un’s first, nuclear test is imminent.

If we think the world would be much safer without Kim Jong-un, we might be wrong. Just look at what is happening in Egypt after almighty Hosni Mubarak gone. Kim, 28, got educated in Swiss with good understanding of democracy and capitalism. The world leaders need to give Kim a firm assurance that he wouldn’t be another Nicolae Ceausescu of Romania even if North Korea opens to the world.

2) More babies born in Korea
According to the government report, Korea’s fertility rate jumped up to 1.3 children per woman last year, the first time Korea to have reached the level in 11 years. The 1.3 mark is important as that level is deemed in the “lowest-of-low fertility” category.  From Jan to Nov last year, 450,600 babies were born, 3 percent up from the same period. The government warned that Korea will become a super-aged society by 2026, in which people aged 65 or over account for 20% of total population if the current rate of low fertility continues.

While the government incentives were the main reasons for the fertility rebound last year, another key reason was that 2012 was the year of “Black Dragon” which comes every 60 years. Koreans believe that the babies born in “Black Dragon” would have more fortunes in their life. Hard to believe? The marriage increased over 8% in Jan and Feb in 2012 over the same period in 2011, but got reduced to -8.3 percent in May, and kept declining throughout the rest of 2012 except for Jul and Oct.

2. Economy
1) Glass ceiling in government remains thick
 According to public information site, Alio(, only 9.1% or 272 executives out of 2,993 state-run institutions are women. Only 16 of 288 public institutions had female chief executive officers, and 149 had no female executives. The worst was the Financial Services Commission, which had only 1 female executive out of 109, less than 1%. . The best was Korea Childcare Promotion Institute where 66.7 percent of the executives were women.  Both ruling and opposition parties have jointly proposed a bill to raise the ratio of female executives to 15 percent in public institutions in three years and to 30 percent in five years.
If it is the glass ceiling in the government institutions, it is 10 inch thick steel plates in private companies as there are probably more female commanders in Al Qaeda than female executives in Korean private companies. There were three females out of 124 colleagues who joined Hyundai together with me on Dec 1, 1986. Two were assigned to the R&D design center where they sketch future models, and one to finance team. All of the three left the company within three years.

2) K-Swiss to be bought by E.Land
 Korea’s E.Land agreed to pay $170 million for K-Swiss to add the U.S. athletic shoemaker’s brands to its portfolio. The K-Swiss stockholder will receive $4.75 per share, 49% more than closing price on the NASDAQ. K-Swiss was not good financially as the revenue in the 12 months through September was $231M, compared with $508M in 2005. Net losses from 2009, 2010, and 2011 totaled more than $160M. E.Land’s business “will provide K-Swiss with the resources and scale to return to its former performance levels,” said Steven Nichols, President of K-Swiss.

E.Land was established in 1980 by Mr.Sungsoo Park who opened a small clothing store in front of Ehwa Women’s University in Seoul at the age of 28. Mr.Park has grown the company over 10 trillion won($9.5 billion) in sales in 2012. A devout Christian, Mr.Park’s success comes from his deep belief in God, and his frugality.  He drives his own Kia Carnival (Sedona in the U.S.), brings his own lunch box, flies in economy class, and stays in a cheap motel when in business trip. To save hotel cost further, Mr.Park makes his employees stay in one room together, rather than two or three.

3. Auto Industry
1) Leave me alone, damn politicians!
 Ssanyong Motors, Korea’s 5th largest automaker which went bankruptcy in 2009 then got bought by India’s Mahindra in 2011, is urging the main opposition party and outside activist groups to stop meddling in the labor disputes, arguing that such interference only makes the matters worse. Ssangyong union also issued a statement opposing the legislative investigation over the layoff of workers at the time of bankruptcy, saying that could jeopardize its corporate image and operations. The union said “Ssangyong’s revival depends on new investment and improved sales, but if politicians beat and shake the company, we all die.” The opposition Democratic United Party is still pushing for the legislative investigation, urging president elect Park Geun-hye from the ruling party to agree to the investigation.
Both Ssangyong management and union are preaching the politicians to leave them alone. A husband named Joseph was probably shocked when his wife Mary delivered a baby called Jesus not from his own blood, but Joseph was O.K with it. Over two thousand years have passed since. Why do still people keep talking and arguing about Mary having a baby, when her own husband Joseph had no problem with it?


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