Shin-won sees no dangers operating in Kaesung

Park Sung-chul, CEO of Shinwon, South Korean clothing company, says “despite North Korea’s recent missile firing, the mood in Kaesung industrial park is very peaceful and lively.” “From early next month, the second factory will be up and running, and the number of local workers will double and so will the production line. North Korean officials underline the Kaesung business will not be influenced by political conditions,” said confident-looking CEO.

In fact, South Korea has been consistent in its position that Kaesung projects won’t be put in jeopardy despite international criticism that the South is virtually tunneling money into the regime without being assured where all the money is going. The international community points to Seoul’s two-pronged stance that Seoul serves as a lifeline to the Kim’s regime while it called off humanitarian assistance such as fertilizer and rice to the poverty-stricken people.

For its part, North Korea has recently made it clear it also doesn’t want to hamper inter-Korean economic projects and will continue to safeguard the Kaesung industrial park. Given it has nowhere else to turn to, it is no surprise the regime tries to defend the projects. US’s financial sanction followed by China’s recent freeze on North Korean bank accounts turn out to be very successful to put more constraints on already cash-strapped regime. Having said that, for the regime there is no option but to clinging to the projects.

After the missile launches, Shinwon saw its stock price falling once to W17,000 from W32,000 but the company maintained composure. In an effort to diversifying dangers, the production in Kaesung amounts to only 5 per cent of the company’s whole production and the company is always ready to move its production facility out of Kaesung in emergency. The CEO says “order has increased a lot so we extend working hour by 2 hours. When the third factory begins operating from this fall, the local workers will total 1,000.”

Increasing personal bankruptcy

The number of personal bankruptcy filed at a court hit a record high with nearly 50,000 in the first half of this year. Under the current personal bankruptcy saving system, when he/she, who is proved to be insolvent by the court, doesn’t need to pay back debts at a bank or card company.

According to the Supreme Court, the number has been on the steady increase since 2002 but this year saw the number skyrocketing with 49,581, more than 30 per cent up from a year earlier.

Experts blame sluggish economic performance and flat personal income level for the increasing personal bankruptcy.

NK cancels Arirang performance

North Korea is to call off Arirang performance scheduled to start from August 14 to the end of August due to damages incurred by heavy flood.

In a faxed letter to South Korea, it says “recent flash downpours have caused a severe damage in many parts of our country, and it will take a while for us to clear up all the mess. Therefore we inevitably cancel this year's Arirang performance.”

The performance is the biggest annual event by the regime, designed mainly for propaganda purposes and also for earning much-needed hard-currency. The cancellation is believed to inflict tends of millions losses on the regime.

Time to work, finally

Hyundai’s yearly struggle is finally over. The Korea’s biggest automobile company and its militant labor union have painfully reached an agreement over salary raises. Hyundai’s partial strikes seriously disrupted car production and exports, causing W1300 bn in losses coming from production stoppage.

Hyundai’s labor union is blamed for its extreme behaviors in pursuing self-interests, especially at a time when the overall car industry is suffering from cutthroat international competition, rising fuel prices, and sluggish consumer demand. What’s worse, its chairman has just been released on probation after having been arrested on charges of embezzlement and breach of trust. And it is reported by Chosun Ilbo that Hyundai’s union headquarters has over 200 members who are solely dedicated to labor work and still paid by the company. According to the report, they don’t work for the company but for the interests of its members.

Labor Union is, by nature, interest-pursuing group, but there has to be certain line for it not to step into. The company and its union should seek to find a way toward “co-existence,” not “mutual destruction.” It can’t do good for nobody if one side tries to benefit from other’s suffering.

Yakult Ajumma's new look?

Korea Yakult Co. agonizes for more than a year over whether to change the company’s yellow uniform for its yogurt delivery women. The company is torn between maintaining decade-old kind, but out-dated image and introducing a new modern outlook, which can risk its decade-long friendly image.

Hwang Woo-seok's new claim!

The disgraced stem cell researcher Hwang Woo-seok argued in court that he tried to reproduce a mammoth, which went extinct thousands years ago, and an endangered Korean tiger. To the prosecution’s question over the whereabouts of W500m among his research fund, he answered he spent the money on cloning a mammoth and tiger, but declined to submit concrete proof of the experiment.

other interesting headlines

- It is reported that heavy rainfalls left 700 North Koreans missing in Yang-duk in Pyung-an-nam-do. A source familiar with the incident said flush downpour of 495 mm for 12 hours from 6am July 14 caused severe landslide which hit the area, leaving 300 people dead and 400 missing.

- President Roh has spent W46.6bn for his overseas visit since his inauguration in 2003. According to a source from the MOFAT, an average of W423m is spent a day on the president’s visit to other country and 68 aides, except security guards, accompany him.

- According to Hyundai Asan, Hyundai Group has spent W600 bn (Hyundai Merchant spent about W260 bn and Hyundai Asan spent W340 bn ) for its business with North Korea since the inter-Korean business began. Hyundai Asan gained net profit of W5.6bn for the first time last year. But the business prospect is bleak since a series of business with North Korea is now being halted, which casts a dark cloud over the future of Hyundai Asan.

- The Fair Trade Commission is investigating into four oil companies including SK, GS Carltex, S-oil, and Hyundai Oil Bank for possible oil price collusion.

- "We will stage a retaliatory strike if the company pays salary to union workers who don’t participate in the sit-in and work instead,” warned the Hyundai’s infamous labor union. They are not just bluffing. The labor union has already launched retaliatory strikes five times this month for this or that reason.

local paper headlines

1. Chosun Ilbo

- The construction market shows the worst performance since the 1997-8 Asian financial crisis and exerts negative influence on the overall economic performance. The economic growth seemed to be picking up from the second half of last year, but the Bank of Korea revealed July 25 that net increase in GDP in the second quarter was a meager 0.8 per cent, lower than expected 0.9 per cent.

- The Supreme Court ordered Korea Railway Worker’s Union to compensate W2.44 bn to Korea Railroad for incurring damages by launching 4-day illegal strike in 2003. Meanwhile Posco also prepares for suing Pohang Construction Labor Union for damages.

- Finance Minister Kwon O-kyu is reported to have said “(I will) not play golf during my term and spend the weekends doing mountain climbing. “It is not good for government officials to play golf while people are suffering from flood,” implying it would be also difficult for officials in the Finance Ministry to play golf.

2. Maekyung

- ‘Apartment distribution system’ will be overhauled from 2008. The changed system will work more favorably to a household which hasn’t owned a house for a long time and comprises many and old family members.

- A high ranking government official said that the government confirmed the BoC’s measure to freeze North Korean bank accounts.

- The government is set to introduce the revised bill under which health insurance will cover only cost-effective medicines. Under the existing bill health insurance covered all medicines which were proved effective.

- Gasoline prices hit a record high with W1544.76 per liter due to unstable political situations on the Korean peninsula and the Middle East.

- It is reported that Hite is trying to get Jinro listed in the US, UK, and Korea stock markets. Securities experts analyze that if Jinro can get listed in several countries, there will be many advantages: first it can easily attract overseas investment; second the company can avoid possible Korean market instability by putting eggs in several baskets. If the plan succeeds, aggregate market value of Jinro will be expected to be far over W5000bn, analysts assume.

Samsung Everland Trial

The following article appears in Sisa Journal
..............................................

On July 20, the appeal court didn’t make any judgment on Her Tae-hak and Park No-bin and ordered the prosecution to further prove their criminal acts.

The court said “we were thinking to make a judgment, but we considered we might reach just a cursory conclusion since some part of the basic statement in the written arraignment is not clear enough.”

Unlike the first trial, the judges in the appeal court showed different atmosphere by saying: we can make a different decision regardless of the decision made in the first trial; we consider there was a jump in the logic in the first trial; we are not interested in whether the (Samsung) group acted in collusion and we want (the prosecution) to just find out exactly what the two suspects did.

The prosecution gets frustrated. It should prove that Her Tae-hak and Park No-bin actually colluded with shareholders of Samsung Everland, but it is hard to do so. One person at the prosecutor’s office said “who would say they acted in collusion? The prosecution thought even circumstantial evidence would be enough to point to the fact that the two suspects knew that Lee Jae-yong would take over the stake, but the court seemed to see it differently. For the prosecution, there isn’t much new to prove in front of the judges.”

For its part, Samsung also wanted to get a judgment at the appeal court. It seems that the company thought it would be preferable for the court to close the case even if the two were convicted of guilty. One Samsung employee gets frustrated and said “I don’t know what is in the mind of the judges.”

The thing that gets most attention is whether Lee Kun-hee will be summoned. There are three prospects: the prosecution will summon him. There are leads suggesting Lee is deeply involved in the scandal and the prosecution will face severe criticism from the public if not investigate him. The likely course of action would be to summon him and indict him without detention; he won’t be summoned since Lee’s lawyers told everything instead and there isn’t much new to come out from his mouth; He will be summoned but probed in a third place such as a hotel, not at the prosecutor’s office.

other interesting headlines

- It is reported that Cheong-gye-cheon greatly helped the Jongro area not to be flooded by flush rainfalls. Cheong-gye-cheon area was, before restoration, frequently damaged by heavy downpours.

- A witness confirmed to the police that a while girl, aged 13-15, was spotted to come out of the house of a French man who found two frozen dead bodies of babies in his refrigerator. The witness is reported to have watched the girl very carefully because the witness knew the French family was on vacation and there was nobody in the house.

- The presidential office is in agony over whom it will pick as the next Justice Minister. There are several people in its shortlist but they are said not to be competent enough to be the minister. In the case of Moon Jae-in, Roh’s former senior secretary for civil affairs, who is favored by Cheong Wa Dae, the opposition party is highly likely to disapprove.

- Ban Ki-moon won the straw poll for the next secretary-general of the UN with 12 ‘ecourage’, 1 ‘discourage’ and two ‘no opinion’ votes.

- It is not clear how many North Korean bank accounts were frozen by Bank of China but it is said the amount of money will be much higher than $24m in the frozen account of Banco Delta Asia.

- Kim Young-ki, a judge in Gwangju District Court, is very popular among female employees. He turns into a DJ in every Tuesday morning and runs an in-house radio program in which he receives song requests, delivers messages, and shares in-house information.

- Controversy theory is raised within the GNP surrounding the golf scandal of some of its lawmakers who enjoyed golf games in the Gangwon province, the most severely hit area by flush downpours. The theory goes that an aide to Lee Myong-bak prepared the golf game in the flooded area in order to get them embroiled into trouble. The aide apparently didn’t join the game.

- Samsung Group decides not to employ people who can’t communicate in English from the second half of this year, which triggers disputes among netizens.

- Regarding growing suspicion that he plagiarized the thesis of his student, Education Minister Kim Byong-joon strongly countered, “the truth is that the student quoted the hypothesis, methodology, and framework of my thesis.”

Local paper headlines

1. Chosun Ilbo

- BoC has frozen North Korea’s bank account in Macau in association with the regime’s alleged US greenback counterfeiting and money laundering. It was the first move by the Chinese government to impose such a measure. The Macau bank is where National Intelligence Service wired $200m to achieve inter-Korean summit back in 2000.

- Hyundai Motor and its labor union failed to hammer out agreement on wage raises before summer vacation.

- Yoon Young-gwan, who served as the first Minister of Foreign Affairs and Trade under the Roh government, lambasted the government for its policies towards North Korea and the US. “We need a principle in embracing Pyongyang. By doing so both the South and the North can avoid being ‘a missing child’ in the international community,” he said. “Korea-US alliance is what we have chosen aggressively by ourselves and under the stable alliance environment we could accomplish economic development and democracy.”

- Frustration is mounting among government officials in charge of diplomacy and security mainly due to Pyongyang’s unpredictable behaviors and increasing domestic criticism toward government’s North Korean policy. An official said to a reporter “please don’t criticize when you can’t offer an alternative.”

2. Maekyung

- Amid ‘parachuting appointment’ scandal, Korea Exchange might face a partial stoppage. Korea Exchange labor union said “we will stage an all-out sit-in in the face of legitimization of ‘‘parachuting appointment’ by Cheong Wa Dae, the political circle, and the puppet management.”

- As part of measures to improve working environment for temporary workers, the government unveiled a wage increase plan. According to a document obtained by Maekyung, the government will increase the wage for temporary workers in the field of security and cleaning in the public building to the level of private sector.

- Despite crack-down by the police, illegal gambling doesn’t show any sign of abating. Experts say the government should introduce stricter rules for the illegal gambling, otherwise it will continue popping up in the city.

Other interesting headlines

- As for arresting of union leadership involved in the Posco illegal strike, Bae Sung-won, director of Pohang division of Korean Federation of Trade Unions, strongly complained about the government’s measure and said the government broke its promise not to arrest strikers as long as they voluntarily disbanded.

- Kim Byong-joon, Education Minister, is found out that he plagiarized the doctorate thesis of his students and submitted it to a conference in 1988 when he was a professor of Kookmin Univesirty, raising serious doubts on his moral and consciousness as a scholar.

- Lieutenant-colonel Park Young-hee was dispatched July 9 to the Korean Zaytun Division in Iraq as a staff officer in charge of troop information and education, for the first time as a female solider. Currently 39 female soldiers are serving in the division, who run classes for illiterate local women and children and help them find employable skills.

- The government decides to set up a “Korea-US FTA Supporting Committee’ and tentatively appoints Han Duk-soo as a commissioner. Cheong Wa Dae Press Secretary Chung Tae-ho said in a briefing “regarding the Korea-US FTA negotiations, the committee will try to collect public opinions from all walks of life, encourage healthy debate, and dismiss splits of public opinion by providing the truth and correct information to the people.”

- As Kim Ok appears to be as the new first lady of North Korea, observers are getting interested in how she might affect the succession process within the regime. She has started working for Kim Jong-il in her 20s and is believed to know well about North Korean politics and power struggle. Whether there is a child between the two is not known, but she might exert influence on Kim not to hurriedly transfer power to one of his three sons.

- As the medical industry is struggling with 3,000 new doctors being churned out from university, doctors try to do anything to revive the performance of their hospitals. According to Korea Hospital Association, 8.1 per cent of hospitals shut down in 2004 due to miserable performance. Some look for good places to move and even go to a fortune teller to get advice. Others even go under the knife to change their conservative images and look young and nice to their patients.

- Dong-a pharmaceutical’s Bacchusd, the most popular invigorating drink among Koreans, has been sold over 15.2 bn since it was first introduced in 1961.
- Among government agencies, Industrial Bank is reported to give the highest average salary with W85.4 m. The average salary of Financial Supervisory Service is W75.4 m while Bank of Korea gives W69.7 m.

Local paper headlines

1. Chosun Ilbo

- US Secretary of State Condoleeza Rice urged South Korea to exert leverage in earnest on North Korea in order to get the regime to abandon its nuclear development. She reiterated the US would not talk one-on-one with North Korea except within the framework of the six-party talks.

- Appearing in SBS TV program, “Han Soo-jin’s Sunday Click,” Unification Minister Lee Jong-seok said “I acknowledge that China failed and we also failed (in persuading North Korea).” He added “If North Korea fired missile to intimidate the US, the US failed miserably as well,” implying the US failed because the regime fired the missiles out of frustration that the US flatly rejected North Korea’s invitation of Christopher Hill early last month to Pyongyang.

- Police arrested 58 union leaders who occupied the main office of Posco and led illegal strikes for 8 days. Another 79 union workers were indicted without detention.

- Gen. Burwell B. Bell, commander of US Forces Korea, said it would be preferable for Combined Forces Command to put in place until Korea could build its own independent commands.

2. Maekyung

- Adult PC rooms and adult gambling places are sprawling out in the city as the combined number of the two amounts to 3,800, more that the number of convenient store in Seoul which stands at 2670. According to a research, 42.7 per cent of frequenters of these places have less than W2 m in monthly household earning, indicating low-income family might suffer from illegal gambling.

- Domestic pharmaceutical companies are at the crossroads. They still lack competitiveness and possible Korea-US FTA negotiation further aggravates its competitiveness. Worse yet, it has recently been found out that efficacy of some of generics was manipulated, which greatly tarnished reliability and image of those involved companies.

N.Korea to cut off family reunion

In a retaliatory measure against South Korea’s postponing the provision of rice and fertilizer, the North declared it would stop on-going inter-Korean projects including family reunion and the construction of reunion headquarters.

In a letter to the South Korean Red Cross, it said “we wanted inter-Korean cooperation business based on humanitarian concerns to go ahead, but the South created very severe challenges in front of the business.” “This is tantamount to ‘anti-nationalistic’ behavior,” goes the letter.

Unification spokesman Yang Chang-seok said “it is, to some extent, an expected course of action, but we feel very sorry for separated families. We will do our best to resume family reunion.”

'Uneasy bedfellow'

As tensions are mounting over how to handle defiant North Korea, the US government shows its uneasiness over inter-Korean economic cooperation including Kaesung industrial park and Mt. Keumkang tour. Mt. Keumkang tour is the biggest money supplier to North Korea which is believed to receive about $1 m every month. Except for labor costs, the North pocketed $12m in land lease and construction through the project of Kaesung Industrial park.

The Korean government is reluctant to scrap its inter-Korean economic projects, not least because it can not only deal a terrible blow to the North Korean economy, which has been already suffering greatly from financial sanctions imposed by the US, but also devastate some Korean companies involved in the project such as Hyundai Asan.

But western experts criticize the measures taken by Seoul after the missile launch, saying that Seoul shouldn’t have cut off rice and fertilizer provision which could have helped ordinary North Korean people while it continues the economic projects that provide money directly to the pocket of Kim Jong-il regime.

For its part, President Roh Moo-hyun vents his own frustration over fissure with his most important ally, the US. He said yesterday of possible measures by the US and Japan to impose further sanctions on North Korea, “I don’t think excessive response and unnecessarily heightened tension will be helpful to solve the problems,” indicating he is opposed to the moves by the both countries.

All about strike

- Labor unions under the umbrella of Korean Confederation of Trade Union steps up its labor struggles in Ulsan and Pohang. In Ulsan, the KCTU led the sit-in of 30,000 unionists from 25 labor unions while strikes in Posco do not show any sign of abating. The public increasingly frets over a series of strikes led by the KCTU since ordinary people think the reason behind the walk-out is not legitimate enough to cause such damages to the economy.

- Labor strike of four automobile companies, Hyundai, GM Daewoo, SSangyoung, and Kia, is putting car exports under severe restraint as companies are having hard time in supplying cars to be exported. If the strike goes on, it is expected to have negative impact on the overall economic performance this year.

- As people are growingly uneasy about violent labor strike, some criticize the government for its lackluster response and the absence of law and enforcement. A person in the financial circle says, “I feel frustrated to see the way the government and the police respond to the incident.” “It is time (for the government) to show by action whether it be mediation or exercise of power.”

- Hospital unions are likely to stage a sit-it as early as July 21, raising concern over inconvenience for patients.

other important headlines

- It is reported that Kim Jong-il July 16 issued ‘war mobilization order’ to soldiers and the public, for the first time in 13 years when North Korea walked away from NPT in 1993 and imposed emergency measures. A high ranking government official said “soldiers who had been on vacation or overseas went back to their army base. And moves of readying army cars and combative equipment have been spotted.”

- In a security meeting presided over by President Roh, the government decides to continue persuading North Korea to get back to the six party talks, but if failed it will hold five-party talks as an alternative to discuss measures to bring the North to the negotiating table. The government also postpones the provision of materials for light industry and inter-Korean economic cooperation promotion meeting for the time being.

- A research by Prof. Choi Pyung-gil at Yonsei Univerity shows that 64 per cent of university students say their goal at the university is getting specialized knowledge and a good job while less than 1 per cent of respondents say their goal is active social participation and volunteering. The report shows that students are more pragmatic and self-centeredness than the old generation who spent their student life doing demonstration against the autocratic government.

- Food is cut off to union workers who are occupying the main office of Posco in Pohang. The company also shut down electricity in the building. 532 workers stopped participating in the walkout but there are still 1,000 unionists.
- Flood warning was imposed on the lower part of Nakdong River as the water level keeps rising.

- National Intelligence Service received this year W429.2 bn in ‘special operation cost,’ the biggest such budget, followed by Defense Ministry and the Police with W120-140 bn. ‘Special operation cost’ is given to a government agency which can use the budget without reporting about where it spends the money.

Local paper headlines

1. Chosun Ilbo

- Sixty per cent of Korean disaster fund goes to reconstruction and recovery and the rest 40 per cent is annually spent on disaster prevention while Japan spends 87 per cent only on preventive measures. Dr. Park Duk-geun in National Institute for Disaster Prevention says “we should shift our focus from short-term damage controlling measures on to long-term preventive ones.”

- The US government is confirmed that it would give back to Korea army operation control in wartime by 2010. The Korean government has been pushing for taking the control back as early as 2011-2012, but army experts voice concern that Korea will not have been ready for the job at that time.

- Kang Jae-seop, newly elected chairperson of GNP, revealed his ambitious plan to ‘overhaul’ the party. In an interview with Chosun Ilbo, he said “what I want to do most as a chairperson is remove the negative image of GNP.” “I will try to completely change the party within 6 months by introducing code of conduct for moral recovery and self-sacrifice.”

- Eugene Group is set to buy out 12.82 bn stocks or 4.87 per cent of Seoul Securities share for W20.5 bn after it bought out 1.41bn shares or 0.53 per cent from July 12 to 14. The group becomes a controlling shareholder of Seoul Securities with 5.4 per cent of the company stock.

2. Maekyung

- Due to heavy rainfall in Gangwon province, farm land was devastated and vegetables all ruined and were washed away. Vegetable prices are expected to go up 2-3 times.

-Kim Jong-il, commissioner of Defense Acquisition Program Administration, is reported to tender resignation this morning over bribery scandal.

- The government designated 18 cities in Gangwon province as special disaster zone. Those cities will get up to 80 per cent of recovery cost.

- “Making inroads into the financial market lays groundwork for M&As in construction and logistics companies. When we get approval from the FSC, we will do our best to take full responsibility and carry out our duty as a controlling shareholder of Seoul Securities,” said Yoo Kyung-sun, CEO of Eugene Group, in an interview with Maekyung.

Backpedaling Kim Jong Il-report by Chosun Ilbo

Some North Korean experts say Kim Jong-il seems to be backpedaling in economic, diplomatic, and domestic reform matters.

In 2002 Kim was often applauded for his efforts to actively try to participate in international community, improve inter-Korean relations and aggressively forge ahead with regime reforms.

But now he seems to reverse all these trends, in particular in diplomatic matters. In 2002, Kim displayed active efforts to improve diplomatic relations with other countries such as normalizing diplomatic relations with 10 western countries and the 2002 summit with the Japanese leader. But since 2002, he has been back to brinkmanship and self-imposed diplomatic isolation.

North Korean experts say Kim also seemed to replace old guards by new and reform-minded ones but now he re-rehires old ones. In economic sector, he also brings back old policies. Seo Jae-jin, researcher in Korea Institute for National Unification, said “as the situation is getting more difficult, Kim Jong-il is believed to be surrounded by hard-liners, not reform-minded people.” “He seems to continue sticking with his current policy until President Bush’s term is expired.”

Other important headlines

- Eight mountaineers, who stayed in a small rural village to undergo training in the run up to mountain climbing in China this September, are reported to have saved the lives of 50 local people who were on the verge of being swept away by flooding.

- It is reported that Kim Jong-il has said to an American who visited Pyongyang early this month that China is ‘unreliable country.’” In hours-long conversation, he spoke out his mistrust and criticism toward the Chinese leadership by saying “China is not helping us in a decisive moment.”

- The Ministry of Defense is said to have taken over management control of four more army bases than originally revealed 15 places. “The reason why we didn’t include the four bases when announcing the 15 army bases was we didn’t reach an agreement with the US side at that time. And the US had withdrawn the security company to save its budget and those army bases were then left empty so we dispatched our soldiers there,” said an army official.

- The Ministry of Health and Welfare revealed measures to encourage domestic adoption including two-week adoption vacation, domestic-first adoption policy, and financial assistance to adopting families.

- It has been five days since fierce confrontation between Pohang construction labor union and the police began. The unionists are occupying Posco headquarters and the police failed to enter the building. It is very unusual for part-time construction workers, who are widely believed to have weak cohesiveness, to go on a long-term strike.

- Public criticism is mounting over 30 Goyang city officials pushing ahead with its overseas travel to China at a time when residents in the city are suffering from heavy rainfall and busy doing reconstruction works. Kang Hyun-seok, City Mayor, explained “I didn’t think it was going to be a big problem and it was difficult to cancel the already-booked tour. So I let them go as planned.”

Local newspaper headlines

1. Chosun Ilbo

- Residents in hardest-hit Yangpyong 2, Yeong-deungpo-gu might file a class action lawsuit against the Seoul city government and the subway construction company for faulty embankment construction that caused 1,900 low-lying houses flooded and more than 5,000 residents evacuated. A resident known as his last name Hwang said “the damage is a clearly man-made disaster due to poor reconstruction of Anyang-cheon embankment.”

- ASEAN Regional Forum, slated to be held from July 26 in Malaysia, is also expected to adopt a statement condemning North Korea missile tests.

- The government is set to designate 280,000 pyong in green-belt of the Metropolitan area as public residential area.

- Korea and US intelligence suspect two newly-developed IRBMs (Intermediate Range Ballistic Missile) with range of 2,500 to 4,000 km were among the six missiles fired on July 5. A government source says “among six missiles excluding Taepodong 2, we perceived new electric wave far different from that of Nodong or Scud.”

2. Maekyung

- Vegetable price is skyrocketing due to expected supply shortage incurred by heavy rainfall in Gangwon area. Destroyed roads and cut-off railways disrupt the distribution of the products, further aggravating the situation.

- Labor strife is set to intensify in key sectors of medical, automobile and steel industries. A labor official says “we expect the move to settle negotiation between companies and labor unions starts in earnest near the end of July before vacation.”

- In an interview with Maekyung, Prime Minister Han Myung-sook said “if we revise real estate policies over and over again, it might cause confusion in the property market and provide chances for speculative investors. So the government should stick with its policy unless there is a huge mistake.” Regarding recent North Korean missile test fire, she says “the government has no option but to respond to the incident, but I don’t think it is desirable for the government to give up stable management of North Korean issues and cut off the dialogue link.

- Lee Young-seop, Minister of Government Administration and Home Affairs, says he will ask the president today to designate 10 cities in Gangwon area as the special disaster-stricken area. If designated, the area will get financial supports and other measures that help the area be rebuilt more easily.

Financial Times brands 'Red Devil' as Most Lively Fans

Here is what the FT says of Korean fans
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Win, lose, or draw, score or concede, it didn't seem to matter to the South Koreans who spent the entire 90 minutes singing-and not just bog-standard terrace chants but proper(if indecipherable) songs.

other interesting headlines

- Subway line 3, which partially broke down yesterday due to heavy rains, is now up and running

- It is reported that eight Scud and Nodong missiles are fitted into the launch pad and can be fired within 3-4 hours, according to NSC intelligence. GNP lawmaker Chung Hyung-geun quoted NSC as reporting, “North Korea is expected to decide whether it test fires another missiles after figuring out a possibility of US and Japan’s further sanctions. Talking with China and inter-Korean ministerial talks also influence North Korea’s decision.”

- The rate of suicide attempts by transgender is 1000 times normal people and transgender who went through sex change operation is still 100 times more likely to attempt suicide than ordinary people.

- Chung Mong-koo is reported to leave Yonsei Severance Hospital today and get back to management control of the motor company. A Hyundai official said, “we reach a point where we can’t further postpone coping with emergent managerial issues.”

- Kim Hyung-o is elected new floor leader of the GNP.

- SK Telecom decides to stop providing adult contents which has been available on its wireless Nate service. Kim Soo-il, director of date business department of SK Nate, said “our company has been doing a lot of efforts to protect minors from adult contents,” “we decide to stop the service to take social and ethical responsibility and contribute to the wireless internet industry.”

- A group of team of Seoul National University has successfully reproduced two female cloned dogs with cooperation with a team of Soon Chun University. The two dogs were produced through the same cloning technique that Dr. Hwang applied to produce Snuppy.

- Amid sluggish job market, the number of students who postpone graduation is on the steady rise. According to data of Seoul National University, 28 per cent of graduating students in 2004 spent 9 semesters, one semester more than usual, up from 27.7 per cent in 2003, and 25.3 per cent in 2002.

Local paper headlines

1. Chosun Ilbo

- Kwon Ho-ung, North Korea’s head of delegation, said in his keynote speech, “(Kim Jong-il’s) military-first politics safeguards South Korea and South Koreans benefit from it.” South Korean counterpart Lee Jong-seok bluntly rejected the remark and countered “who asked North Korea to protect the safety of South Korea? Helping our safety doesn’t harmonize with your missile and nuclear development.”

- On the request of 500,000 tons of rice by North Korea, Unification Ministry made it clear that it was not willing to do so for now.

- It is belatedly reported that three judges in Gunsan district court, resigned on allegation of receiving bribes from the suspect who had been arrested by the prosecution and helping him be released.

- Three hours of flash downpours were enough to literally paralyze the planned city ‘Ilsan.’ Subway was totally inundated, roads were impassable, and a vast swathe of the city was flooded. Lee Young-jong, office worker, complained “it is ludicrous a few hours of rain can flood subways and roads.”

- Ajinomo, Japanese Food Company, has successfully launched instant ‘bibimbap,’ and Nobu, also Japanese up-end restaurant chain, is making great strides into the world food market with Korean galbi and bulgogi. Taiwan MacDonald pulled off more than W1.8 bn for two month by developing and offering ‘kimchi burger.’ Korea, however, trails far behind its Asian rivals.

2. Maekyung

- Amid criticism for lack of preparation and research, the government decides to scale down the size of the ‘Innovative City’ by 25 per cent to 13,060,000 pyoung from 17,590,000 pyoung.

- Economic experts voice concerns over internal disputes on the on-going Korea-US FTA negotiations. The government isn’t demonstrating its capability to control the negotiations, which in turn aggravates public opinions for the FTA. President Roh ordered July 10 to organize ‘local team’ to deal with the lack of ‘control.’

- A Maekyung poll suggests nine out of ten people are concerned about security system of the government and 65 per cent of people take North Korea’s missile launches seriously. 61.2 per cent agree with the government’s decision to withhold further assistance to North Korea for the time being.

Other headlines

- Kim Dae-ho, former vice CEO of North Korean nuclear waste disposal company, who defected from the regime and came to South Korea in 1994, said in an interview with Yonhap News, “Kim Jong-il was very vigorous in nuclear development and he often said ‘the leadership in Nodong-dang 131 (nuclear development agency) is my guard,’ and ‘I am the commander-in-chief in nuclear development.’”

- The negotiation teams of Korea and the US are today to talk about 14 fields including cars, investment, and technology transfer. The hardest part is expected to be in the field of cars.

- A young man who drank poisoned coca-cola is reported to be in serious condition. A middle-aged woman only known as her last name, Park, was arrested yesterday on charges of blackmail and attempted murder. The coke company is recalling all coke bottles in Jella province.

- A series of mega projects is being promoted which can change the landscape of Gangbuk region. The Seoul government is to spend W56 trillion to develop 33 new towns by 2012.

- Goyang-city in Gyeonggi province is reported to be the hardest hit by heavy rainfall that stared from last night. About 60 roads of the city are totally flooded and submerged.

- Does Japan have military power to preemptively strike North Korea? Experts say Japan is in a very limited situation to use its military without the help of the US. Tokyo has an ability to develop missiles but does not possess ones right now.

- Contrary to popular belief that you can’t pay by card small amount of money, there is no such minimum amount, according to the credit card industry.

- Roller coaster in Lotte World suddenly stopped yesterday, marking a fourth accident happened in the amusement park this year. There is no reported injur

Local paper headlines

1. Chosun Ilbo

- As Kang Jae-sup, supported by former leader Park Geun-hye, received the biggest vote followed by Lee Jae-o backed by Lee Myung-bak, and was elected a new leader yesterday, the party is expected to suffer bigger rift due to increasing disagreement between two factions. Kang garnered 5254 votes or 25 per cent of approval rating, followed by Lee with 4791 votes or 22.8 per cent.

- The prosecution started investigation into Moon Byong-wook, CEO of Sun & Moon Group, over alleged misappropriation of tens of billions won and breach of trust. He was probed in 2003 on suspicion of giving slush funds to aides of then-presidential nominee Roh Moo-hyun.

- The second tallest twin towers only after 160-story burj-Dubai in the United Arab Emirates will be built in Song-do city in the free economic zone of Incheon.

- The Korean government doesn’t feel happy about the fact that Japan has been, in fact, preparing a UN resolution that might include possible military power exercise on North Korea but hasn’t consult South Korea over the matter.

- In the second round of FTA negotiations, Korea and the US agreed to more strictly apply rules of origin on imported cars. When imported cars do not use a certain percentage of Korean or US parts, they will be excluded from tariff reduction.

- Hyundai Motor is said to offer the labor union a 4.4 per cent salary increase while the union asked a 9.1 per cent increase. The negotiation seems to face an uphill battle.

2. Maekyung

- Relations between Korea and Japan have soured to a worst level over how to deal with North Korean missile launches.

- Korean Airline has topped number one in terms of cargo transportation for two consecutive years, according to International Air Transport Association. Its competitiveness mainly comes from successful international marketing and sales strategy. About sixty-four per cent of its sales revenue comes from outside Korea.

- The Ministry of Construction and Transportation revealed stricter rules, effective from today, to discourage illegal collusion between apartment owners to drive up house prices, such as frequently announcing real price of the apartment.

- As an alternative to the current 25 per cent ceiling on equity investment, Park Sang-in, professor of Seoul National University, suggested a new system under which the limit on total investment is imposed collectively on a conglomerate, not on an individual subsidiary company.

July 11 local news headlines

1. Chosun Ilbo

- The government is said to oppose to the UN Security Council Resolution aimed at imposing sanctions on North Korea for its missile test firing. A government official familiar with the matter said “it is not desirable for us to express our position on a particular resolution when we are not a member of Security Council,” a remark that is understood as an expression of obvious opposition. The vote on the resolution was postponed.

- On various economy-stimulating measures suggested by Uri Party, Finance Minister nominee Kwon O-kyu said, “the economy is expected to continue its growth trend so (I am not considering) further pump-priming measures and stick with the current policy line.”

- Typhoon Ewiniar died down last night, but it left its severe mark on southern, central, and eastern part of the peninsula, claiming at least six lives. Meanwhile the fourth typhoon Bilis is heading for the peninsula from off the coast of Taiwan.

- Seoul is considering dropping its stance on getting ‘Made in Kaesung’ products acknowledged as ‘Made in Korea’ ones, according to a government official close to the matter. “Because of North Korea’s missile firing, it is now impossible to get concession from the US,” and “the government is thinking to give up on Kaesung issue in the Korea-US FTA negotiation and bring up the issue later in line with the resumption of stalled six party talks.” He added the government will not officially withdraw the issues from the on-going negotiation but use it as ‘bargaining chip’ to get concession from the US in the controversial fields such as agriculture.

2. Maekyung

- Government’s project to develop ‘Innovative City’ around the country can be a failure due to lack of research and time constraints, said some experts. Last year the government has designated 10 cities as an innovative city where 175 government agencies will be relocated as part of the balanced development plan.

- Japanese officials are increasingly embracing a radical measure to preemptively strike North Korean missiles bases. “There is the view that attacking the launch base of the guided missiles is within the constitutional right of self-defense. We need to deepen discussion,” said Chief Cabinet Secretary Shinzo Abe.
- The US demands South Korea the opening of online education market. US chief negotiator Wendy Cutler said in a press conference held at Shilla hotel, Seoul “we are not interested in opening up education and medical markets, but we are interested in market access to internet educational service and test services such as SAT.”


3. Naver

- US and Japan’s surveillance satellites spotted a move indicating North Korea is ready to fire another two Nodong missiles, Yomiuri Sinmun quoted Japanese officials as saying.

- Military authorities estimate North Korea spent W60 bn in developing and firing 7 missiles recently being test fired. Some experts point out that Seoul’s assistance for six years since the 2000 historic inter-Korean summit made it possible for Pyongyang to spend such a huge amount of money. Given North Korea’s 2005 budget, revealed at a third meeting of Supreme People’s Assembly, was $2.59 bn, the spending on missiles amounts to 2.5 per cent of the whole annual spending. Another calculation with the real exchange rate ($1 = W3,000) points that the money might take up half of its annual budget.

- Gasoline price reaches an all-time high to 1289.32 mainly due to traffic tax increases.

- Cheong Wa Dae said this morning of Japan’s core cabinet members’ argument on the justification of preemptive strike on North Korea’s missile launch base, “Japan is showing its aggressive nature, which is very worrisome.” “Given the painful history that Japan invaded (us) under the pretext of protecting its nationals living on the Korean peninsula, this is a very intimidating remark that hampers peace not only on the Korean Peninsula but also in North East Asia,” Press secretary Chung Tae-ho said.

4. Daum

- A school in Suwon is reported to have forged ahead with school excursion to Jeju Island amid parents’ strong opposition over typhoon yesterday. 460 students were grounded in Kimpo airport over 7 hours due to flight cancellation on bad weather.

- The main opposition Grand National Party is due to elect five-member of new leadership among 8 candidates this afternoon. The party leadership race is understood by many as a proxy battle between the two leading presidential candidates, Lee Myung-bak and Park Guen-hye.

- WSJ reported rich Koreans are staring to buy out houses in the US. Citing data from the BoK, the paper said Korean’s direct investment in the US amounted to $570 million during the first quarter of this year, nearly reaching the half of last year’s whole investment with $1.27 bn.

portal sites headlines

- Speculation is mounting within the government that North Korea might stay away from the inter-Korean ministerial talks slated to be held in Pusan from July 11. A government official close to the talks says “we made it clear that the major issue will be North Korean missiles and the stalled six party talks so now the ball is in North Korea’s court.”

- As handset maker VK filed a bankruptcy, the company’s plan to develop mobile phone based on GSM in cooperation with North Korean technicians is one the verge of being scrapped. The company has started the joint project with North Korea’s Samcheon-ri Technology Company since September 2003

- It is belatedly revealed that Sonoko Cusineware Co. bribed North Korean officials with various goods including car, western liquor, medicine, and first-rated cooking pot sets worth more than W500,000 around the end of 2004 when the company’s first ‘Made in Kaesung’ cooking pot was out on the market.

- Moon Jung-in said there is high possibility that North Korea attends an unofficial six party talks China suggested. In a radio interview, he said “North Korea is now in an internationally difficult situation so if the unofficial meeting can produce breakthrough and lead to official talks, there will be nothing better North Korea hopes than that.”

- According to a poll on 32 headhunters by Money Today, former president Kim Dae-joong ranks number one in the list of most competent leader among former high-ranking officials in Korea, followed by Cheon Doo-hwan, Roh Moo-hyun, and Kim Yong-sam. The barometers of the evaluation were economic development, stable economy, social unity, and peaceful diplomacy.

- Due to five-day work week system, office workers’ ‘Monday Stress syndrome” is reported to worsen. In fact, Job Korea’s research found out that a word, ‘resignation,’ is searched in portal sites most frequently on Monday.

Maekyung headlines

- Due to flexible tax rates for property, some expensive apartments in Gangnam area pay less property tax than cheaper region. Each ward can autonomously apply different property tax rates within the range of 10-50 per cent.

- As early as next month, it will be easier to build a small-scale plant with less than 3027 pyong in land earmarked for farmland.

- Naver, the biggest portal site by user number, crashed on Sunday morning for 5 hours. The company blamed network equipment error provided by IBM Korea, IT service provider, for the cause of crash.

- Many provincial cities are having a major city development plan. Spurred by Seoul’s development plans in Gangbuk area such as Cheongyecheon and new town projects, other cities such as Seongnam, Pusan, Incheon to say the least are trying to follow suit.

- North Korea’s deposit freezed at Macao Bank is believed to be around $24 M and some suspect the money might be Kim Jong Il’s personal management budget. It is also said that Kim has said there would be no concession made for the US and ordered his subordinates to get the money back no matter what.

Chosun headlines

- Cheong Wa Dae said on its web site “(North Korean missiles) were not targeting anyone.” “It was a known fact that North Korea was set to fire a Taepodong missile. That was why military authorities did not issue an emergency warning. Not only Korea but also other involved countries didn’t made an emergency warning.” It further said “if anyone wants to drive this situation to an emergency for political reasons, it will be only political incident and can’t be a security emergency.” “Cheong Wa Dae decided to slowly respond to this, and this is a decision by the president."

- In an interview with Chosun Ilbo, Christopher Hill said “either Scud or Nodong missile went to far closer to Russia than expected but overall North Korea seems to be satisfied with it.” “I am very cautious about saying Taepodong 2 was a total failure. If it was for military, it was a failure but if it was just an experiment, we are not sure exactly what was going on.”

- A third typhoon EWINIAR is approaching southern parts of Korea, increasing worries over possible damages. The typhoon is heading north at the pace of 26km per hour.

- In an unprecedented move, North Korea presses didn’t report on Kim Jong-il’s visit to Kim Il-sung’s tomb at the 12th anniversary of Kim’s death. Experts say the North is hiding the whereabouts of Kim Jong-il amid heightened tension over its missile test firing.

- Posco is said to raise the rate of favorable stake to more than 34 per cent from 27 per cent. A Posco official says “even if the world biggest steel maker Mittal tries to make a hostile M&A bid towards us, there will be no problem in guarding management control.”

Undervalued blue chip lawmaker Sohn Hak-kyu

Sohn Hak-kyu was wiping tears from his cheek in a greenhouse of Jangsung-gun, a small town in southern Jella province. It is a very odd place to bump into former governor of Gyeonggi-do with the population of 10.62 M slightly more than that of the capital Seoul. In fact he was shedding tears not because of grief or anything like that, but because of hot green onions.

As soon as his term as governor expired, he hit the road carrying a big bag on his back and headed for Jangsung-gun as the first destination among scores of cities he is set to visit as part of his ‘100 days Long March to Feel Public Sentiment.’

In the web site of the project, you can track down where he is now, what kind of work he is doing, whom he talks to, and what he feels during the project. He reveals on the website he has started physically exhaustive march to meet people and listen to what ordinary people have to say.

An easy interpretation can be that it is just one of political showcases of which the main purpose often turns out for good, touching pictures. Given his down-to-earth character and low-profile political history, however, the project seems more than just a political stunt. Moreover he did the similar thing in 2005 for 42 days with 500 university students hoping for world peace.

As a governor, his achievement was remarkable: attracting 114 foreign companies and foreign investment worth $14.1 bn to Gyeonggi province, creating 80,000 jobs in the region, and making 21 business trips overseas for 109 days in order to invite foreign capital.

Despite his excellent job as governor, his achievement was largely overshadowed by that of former Seoul governor Lee Myung-bak, who greatly contributed to downtown scenery of Seoul by successfully finishing an ambitious two-year project to revive Cheong-gye-cheon, a stream that had used to run through the city but buried in the 1950-1970.

Sohn Hak-kyu is now back to floor member of Grand National Party and has not officially revealed ambition to become the top leader of the country. Many observers think he is largely trailing behind former party leader Park Geun-hye and Lee Myung-bak so he stands a very little chance to win the party’s presidential ticket in the primary election.

However underestimating his potential can be a huge mistake. Often compared to a undervalued blue chip, he has recently been chosen as the strongest presidential candidate by a group of reporters.

Today marks 10 days into his 100 long march around the country. Whether he can reinvent himself after 100 days as a leader who truly understands people's mind and proves he has drive and power to realize what ordinary people wants remains to be seen.

Sick and tired of NK missiles?

Here are other headlines

- Amid prospects of sluggish economic performance in the second half of this year, the government unveiled a pump-priming measure with bigger spending budget, which marks a turn in government economic policy that has been based on ‘no artificial expansionary measures.’ The budget for the latter part of this year is W88.8 trillion, up W20 trillion or 29.7 per cent from the same period last year.

- VK, a handset maker, is on the verge of bankruptcy due to capital constraints.

- LG Electronics filed a lawsuit against Chinese Electronic company Haier over infringing on trademark right. LG argues Haier plunders its ‘2in1’ name for air conditioner, which can confuse consumers.

- Hyundai’s militant labor union in Ulsan plants starts its work-out from 10am this morning over physical fights between temporary workers and company’ security.
- The Bank of Korea today freezes its call rate at 4. 25 per cent, in an apparent consideration over unstable market conditions due to North Korea’s missiles. But the rate increase after August can not be ruled out given the BoK’s hawkish stance on the call rate.

- SSangyong Motors has been struggling ever since it was bought out by Shanghai Motors. In 2003 the company recorded net profit of more than W580 bn, but turned in the red last year. It posted net loss of W23.3 bn in the first quarter this year.

July 7 headlines regaring NK missiles

- The air route of Asian Airline OZ 235, which left Chicago and bound for Incheon, indicates the airline was flying the sky over the East Sea, just twenty minutes before the regime test fired its first missile. The government is under criticism for not taking any necessary measures, such as grounding airlines or ships. The airline says it received no warning from the government.

- In an off-the-record report to the information committee of the National Assembly, the National Intelligence Service said North Korea had been spotted to move two Taepodong 2 from Pyongyang to Musudanri early May, so if and when it overcomes technical defects of the missile, it might test fire the remaining Taepodong 2.

- According to the NIS, Taepodong 2 flied for 7 minutes contrary to previously known 40 seconds. The missile went out of the orbit 40 seconds after being launched, but flied 499km for 7 minutes.

- In its first official response since the missile launch, North Korea announced, “this successful missile launch is part of ordinary military grill for increasing military capability for self-defense.” “Like we did this time, we will continue testing flight of our missiles.” Unlike 1998, the North didn’t argue it was a satellite.

- Unlike a relatively calm market behavior on the day North Korea fired missiles, Kospi dipped 1.24 per cent to 15.89 point yesterday and foreign investors started their selling spree by net disposing W 77.3 bn of Korean shares.

- Chung Tae-ho, press secretary to Cheong Wa Dae, said President Roh and US President Bush on July 6 had 10 minutes telephone conversation from 7:50 am and agreed that North Korea’s missile launch was a serious act of provocation and that the two countries would have close consultation and solve the problem through diplomatic efforts.

- The Ministry of Construction and Transportation ordered today passenger jets using Kamchatka air route to fly along the Pacific Ocean route for the time being amid intelligence pointing to a possible another missile launch by the North.

- Intelligence gathered by the US and Korea shows Kim Jung-il is said to have visited the military 12 times last month and 41 times from January to June this year twice the same period last year. A government official said a helicopter suspected of carrying Kim Jung-il had been spotted to land Musudanri but another official denied “there is nothing confirmed regarding Kim’s visit to the place.”

- It is reported that North Korea had offered South Korea, two days before its test fire, to convene working-level talks in the run up to inter-Korean ministerial talks. The North is reported to have suggested a July 7 meeting in Panmunjum but the South postponed the meeting on July 6 apparently due to the missile launch.

- GNP lawmaker Chung Hyung-geun argued, “it is necessary for former President Kim Dae-joong to visit North Korea now in order to ease tension between the two countries. In an radio interview, he said “for his visit to be successful, the Roh government should give vigor to the former president.” “Currently the North is not very happy about Kim’ visit, and I think that is because Mr. Kim is not in a position to make a policy to support or give assistance to North Korea” “Like the US, we need to have a special envoy to get North Korea back to the negotiating table and I don’t know why the government doesn’t do that.”

Missile technology exchanges between NK, Iran, & Pakistan

Western military experts say Iran and Pakistan are deeply involved in the development of Taepodong 2. The reason why Iran is interested in Taepodong 2 seems that it thinks Taepodong 2 is suitable as the launching lad of its satellite which can be launched within a few years.

Japan’s Sankei newspaper reported “Ten Iranian missile experts have recently visited North Korea, and the aim seems to participate in the preparation for Taepodong 2 test fire.” Cooperation between Iran and North Korea on the development of a missile dates back to 1987-1988 when North Korea sold 100 Scud missiles to Iran which Iran used in its war with Iraq. Iran is believed to have attended in the 1993 Nodong missile launching and the 1998 Taepodong 1 launching.

A Pakistani government official attended in the 1993 first Nodong missile launch and in the same year Pakistan started developing a Ghauri missile with the help of North Korea. Pakistan has been supplied with Nodong missiles since the end of 1990s. Pakistan, in turn, offered its nuclear technology to North Korea.

The NYT says North Korea’s missile launch will give more weight to hard liners in Korea, the US, and Japan. It predicts the Korean government’s North Korean policy will lose steam, saying Seoul’s assistance policy, which has raised eyebrows between US hawks, can not be maintained any more. Seoul is put at an awkward position since it had continued underestimating North Korea’s missile threats but the North actually fired!

The paper assumes the incident can bring changes in US North Korean policy as well because US hardliners can definitely get more say in the policy toward Pyongyang. The US is expected to encourage South Korea and China to join in its hawkish policy that prefers sanctions on the regime.

The paper says the missile launch, in itself, is a serious challenge to the US but consequently it might help the US get what it wanted: the failure of Taepodong 2 raises a doubt on North Korea’s capability to develop advanced missiles; Kim Jung-il angered his only ally, China. It points out it is obvious the incident infuriates China, but whether China is going to participate in sanctions is not clear. The missile launch also further encourages Japanese hawks to press its government to enhance the country’s security alliance with the US especially in missile defense.

Another firing assumption came from

1. The North is said to ban North Korean fishermen from going out to sea from July 5 to 11. So until July 11, North Korea theoretically can fire several more missiles

2. On July 5 US local time, US NBC NEWS quoted US officials as saying the North seemed to prepare for another firing of Taepodong 2 and the missile was the final stage of assembly.

3. Military Minister Yoon Gwang-woong said in a military meeting this morning, "given the last two months' process and gathered intelligence on missile equipment, there is still a possibility for North Korea to fire another missile." A military official explained another missile can be Nodong or Scud.

4. US press secretary Tony Snow also raised the possibility of another short or medium missile firing.

another missile?

A South Korean military official was skeptical about reports on another missile firing, saying there is not special sign around the missile launch pad in Musudan-ri. But he said “we are carefully considering all possibility,” indicating the military is closely following the North’s missile moves.

Military Minister Yoon Gwang-woong said in a military meeting this morning, “given the last two months’ process and gathered intelligence on missile equipment, there is still a possibility for North Korea to fire another missile.” A military official explained another missile can be Nodong or Scud.

According to military sources, it takes at least 20 days for North Korea to fire a Taepodong missile: two weeks for bringing engines and rockets to the launch pad and establishing equipment, and one week for fuelling a missile.

The military says it has not received any intelligence on initial stage of missile launching yet.

The government is closely following any possibility of another launch, but it doesn’t seem to seriously believe it.

Seo Ju-seok said in an interview, “the government is carefully scrutinizing the possibility.” “Foreign reports (on another possible fire) are an assumption based on what they have gathered so far.”

Missile buzz & local response

1. GNP lawmaker Chung Hyung-keun argued he heard from a high-ranking government official that the number of missiles was actually 12. He talked to reporters that a Scud missile seemed to target South Korea while Taepodong 2 was aimed at targeting the US and Nodong 1 and 2 targeting Japan. “This missile launch will postpone inter Korean talks slated to be held on July 11 and the government is said to overhaul its North Korea assistance policies,” he added.

2. According to news that has been known so far, Taepodong 2 disappeared from military radar only 40 seconds after the launch. The Korean military assumes the missile exploded in the sky or it just fell into the sea because a propellant on top of the missile failed to separate.

3. Some pro-North groups argue that the North missile test fire is the natural consequences of the US and Japan’s own deeds and provides the two Koreas with an opportunity to concrete people’s proud and cohesion. They said in a joint statement, “regardless of whether it is a missile or satellite, it is North Korea’s own rights and self-protecting response to US, Japan and South Korea’s hostile policies towards it, so it is not the business of international community.”

4. Despite the missile launch, South Korea’s civic groups say they will continue their financial assistance to the North and inter-Korean cultural exchanges on the humanitarian grounds. An official from the Ministry of Unification said “the government has not intervened in civic group’s North Korean assistance activities, and it is their discretion whether it will continue giving assistance to Pyongyang.” “The government stance has not been determined yet on that matter, but even if it is decided, civic groups will make independent moves irrespective of policy lines of the government.”

Meanwhile conservative groups issued a statement strongly condemning North Korea and argued an overhaul of government policy toward North Korea. They said “North Korea’s test firing missiles drives North East Asia to the extreme nervous situation,” and “the government’s policy which has been mainly based on tolerance and concession should be completely changed.” “It accounts to peace-breaking behavior on the Korean peninsula and provocative moves to international society, so the government should completely revise its North Korean policy unless Pyongyang extends a sincere apology and promise not to do that again.”

NK test fired six missiles!

- Seo Ju-seok, Cheong Wa Dae’s unification and diplomacy policy chief, officially confirmed that North Korea test fired a Taepodong 2 missile around 5am and five other missiles with the level of Rodong or scud missile from at 3:32 am. “According to what we have analyzed so far, we consider Taepodong a failure because it seems to fall into the East Sea shortly after it was launched.”

- North Korea’s test firing missiles in this morning seems to be a bold stunt to get international attention. “That the North test fired its missiles in conjunction with the delayed launch of US space shuttle Discovery seems to show Pyongyang’s intention to display its missile capability to the international community,” said a high-ranking official from US Department of State.

- In the run up to its surprise test firing this morning, Kim Jung-il said to have shown laid-back and calm attitudes. According to Chosun Central News Agency, Mr. Kim on July 3 watched a Russian folk dance show and on the next day he visited Daesung tire plant newly constructed in Pyongyang.

- The government is holding an emergency meeting from 8:30 am this morning over a possible negative impact of North Korea’s missile launch on South Korea’s economy. The most worrisome for government officials is the possible instability of financial market might drive international investment to fly out of the country.

what's up Korea July 5

- Korea Commission for the Press selected 12 presses including Hankyerae, Kyunghyang, and Ohmynews as ‘preferred newspapers’ which will receive financial assistance from the commission this year. The commission said a total of 32 newspapers applied for the subsidy and it conducted an evaluation those applicants on 10 items.” The budget came from the government and amounts to W15.7 bn.

- The government is expected to conduct a maritime survey in the disputed waters as early as today.

- As territorial disputes especially over Tokdo do not show any sign of abating, Seoul and Tokyo are said to have a respective plan to set up a department to take care of the specific matter.

- Since the inauguration of this government, labor expenses of public sector have seen a dramatic increase to surpass W20 trillion, up 7.4 per cent from a year earlier.

- The Bank of Korea said yesterday the national economic growth will slow in the second half of this year and current account surplus is estimated to be worse-than-expected with $4 bn. The year-on-year GDP growth rate for the second half will also fall short of the expected 4.6 per cent with 4.4 per cent.

- Internet mini-hompy might undergo a drastic evolution with emotional avatar and three dimensional images. In an ITRC ( IT research center ) forum recently taken place in COEX sponsored by Ministry of Information and Technology, Kim Jong-hwan, professor of intelligent robot research institute of KAIST, has introduced a three dimensional homepage he developed in association with DMD, a software company famous for its golf playing simulation.

- Federation of Korea Trade Unions leader Lee Young-deuk said “a union network has been a long-cherished mission for labor union, but that might lead to a worrying situation if a union network only focuses on struggle and strike.”

- The US Senate military committee is reported to have directed Washington to buy a Korean T-50 as the next-generation trainer fleet. If the US Air Force accepts to buy one, it will open a new chapter in Korea’s military technology.

- The price of nation’s organic food is reported to be too expensive for ordinary consumers with the price of some products being 8 times non-organic ones.

-- Hong Seok-hyun, former CEO of Joongang Ilbo, has been imposed overseas travel ban in connection with the Samsung Everland’s convertible bonds scandal.

- Cyworld said the four winners of Cyworld Song Festivals, which was held from April 10 to June 2, finished producing their digital debut album. The four winners are ordinary netizens and their digital albums will be available from mid-July for free download on the Cyworld web site.

- According to a survey conducted by Korea Chamber of Commerce, 6 out of 10 respondents (60.3%) say university education does not meet the need of a company. And 28.2 per cent of workers with university degree say university education doesn’t necessarily essential for the work they are doing now on the workplace.

What's up Korea July 4

- President Roh pushed ahead with his plan to appoint Kim Byong-joon, former chief presidential secretary for national policy, to education minister despite political opposition including his own Uri party. His decision seems to show President’s determination to stick to his policy line even after the miserable defeat in the local election.

- In the past, Japan was known for her ‘rich nation, poor people’ not least because of its ‘killing prices’ whereas Korea was believed to have ‘poor nation, but better-off people.’ But this trend doesn’t appear to be the case any more. People who traveled to Japan often find out prices in Japan is cheaper than Korea. But this trend does not indicate Korean economy is stronger than that of Japan of which national income per head is $37,050, 2.6 times Korea's $14,000.

- The government is said to have asked North Korea to confirm the lives of five missing high school students believed to have been abducted by the North, but only to receive the answer from it, saying it can’t confirm.
- The government asked Beijing to recognize ‘Made in Gaesung’ products as ‘Made in Korea’ and Beijing is said to send a positive signal on that matter, said a high-ranking government official yesterday. The two countries are having close consultation behind doors.

- Kim Byong-joon, education minister appointee, said in an interview with Chosun Ilbo, “this is very hard time for me, but I take this opportunity to get judged.” “Policy can be a success or a disaster. I use this chance to look back on what I have done.”

- More and more health-conscious consumers are looking for organic groceries. According to a research done by AC Nielsen, more than 95 per cent of respondents have experience in buying organic food. But what is worrying is the production, certification, and distribution of such food is not carefully managed. The number of organic farmhouse that an official is assigned to supervise amounts to more than 500.

- Nexon, a game company, plans to make the stock market debut at Jasdaq as early as this year. An official close to the situation said Nexon Japan, which holds all stock shares of Nexon, made a final decision to get listed at Jasdaq and is currently in the talk with two foreign securities companies over IPO lead manager.

- Local construction companies are doing very well overseas. GS Construction and LG International entered into a contract worth $1.21 bn in Oman. The Ministry of Construction and Transportation said the overseas construction order in the first half of this year stands at 156, which is translated into $8.58 bn, up $1.37 bn (22%) from the same period last year.

- Lee Ho-woong, Uri Party lawmaker, said in a radio interview, “we are not thinking a further reduction in property tax, but try to keep reducing transaction tax.” “For houses worth less than W600 million, we have already announced measures to lessen property tax burden even though we aren’t sure whether that is up to people’s expectation.”

- A monthly magazine, ShinDong-a quoted former Prime Minister Goh Kun as saying, “I can make alliance with Park Geun-hye.” It is his first time to reveal his willingness to form an alliance with her. The former leader of the ruling party said last April that Mr. Goh seemed just a perfect man for the GNP.

- The Ministry of Gender Equality and Family is planning to introduce a measure to give financial assistance of W400,000 to a low come divorced woman when she files a lawsuit against her former husband for expenses for bringing up a child. An official of the ministry said 78 per cent of divorced single mothers don’t get child care expenses from her former husband, which leads to three times child poverty rate in a divorced family than normal family.

- Park Chan-wook, a film director of Old Boy and Kind Keumja-si, is elected a judge for the 64th Venice International Film Festival.

- The labor union of Daewoo Construction Company physically blocked KeumHo’s employees from going to the 19th floor for an inspection. The inspection team with 150 members stayed in the lobby for 30 minutes but had to go back due to labor union’s fierce opposition.

- According to military sources, Korea Air Force asked Boeing for a purchase delay of three F-15K fighter jets which was supposed to arrive in Korea on July 13 because the cause for the recent accident involving the fighter jet has not been clearly identified.

what's up Korea? July 3

- Choeng Wa Dae’s plan of appointing Kim Byong-joon, former chief presidential secretary for national policy, to education minister faces opposition from Uri party. Mr. Kim led a controversial property policy, which is, the ruling party believes, the crucial factor behind the local election defeat.

- A revised law will allow a spouse to inherit 50 per cent of the property of the late husband or wife. The existing law confines a spouse’s bequest to 15 per cent of that of a child so the more the number of child, the less a spouse inherits.

- From next month, a native doesn’t have to submit a departure card to the immigration bureau. A landing card has been already abolished last November.

- It is reported that People’s Solidarity for Participatory Democracy has bought real estate worth W2.5 bn for a new company building. The civic group had been engaged in an active promotion to collect budget for the re-location and in the process invited criticism when it asked donations from big companies.

-. On June 30, 13 individual labor unions including that of Hyundai Motors, the nation’s most militant union, decided to form a union network, which will make the total number of union members at 87,000.

- All market indicators point to sluggish performance of the construction industry. According to the national statistics agency, the amount of construction orders in May dropped 17.9 per cent from last year, continuing losing streak for the third consecutive months.

- Banks will resume mortgage loan programs this month. But the interest rate for mortgage loan is about to rise 1 per cent due to CD (Certificate of Deposit) rates increase, and the abolishment of various preferential interest rate programs that banks have been providing.

- The Uri party leader Kim Kuen-tae said “management control of the so-called ‘national corporation’ such as Posco, Kepco, Kookmin Bank, Samsung Electronics, and SK Telecom, should be protected. Kim said in an interview with Maekyung, “for the sake of national economy, a ‘national corporation’ is necessary.” “We need to provide a proper environment for them so the management of those companies feel secured and focus on their control.”

- While the government is set to conduct a maritime survey in waters around Dokdo from July 3 to 17, Tokyo is said to respond by doing the same survey in waters surrounding the controversial islets. An official close to the situation said “if a Japanese ship conducts a survey near Dokdo which belongs to Korea’s EEZ, we have no choice but to physically respond to that matter.”

- It is reported that four South Korean abductees are still alive in North Korea. Choi Seong-yong, president of Families of Abductees by North Korea, said on July 2 “I heard from a North Korean close to the abduction matter that four South Koreans kidnapped when they were high school students and Kim In-chul who abducted in 1968 are still alive in North Korea.”

- The budget for meals of solider will rise W195 to W5,000 from next year. They will be provided with more nutritionally healthy foods. The Ministry of Defense said it will reduce the amount of rice from the current 620g to 570g from next year because young solders don’t like rice.

- BBC reported Ahn Jung-hwan is said to be attracting interest from three English Premiership clubs along with Hearts.

- China’s QQ, a look-ailke of Matiz of Dawoo, is competing with Kia’s Morning in the Singaporean market. China’s Shinwha news reported China’s Chery company started to sell its compact car QQ in Singapore with the price tag of $21,000 (W19.6 million), the same price with Kia’s Morning.

- Some experts point out that when rainy season starts in earnest, Cheong Gye Cheon can flood and endaner the safety of pedestrians.