Due for publication March/April 1999

Officer contact details: Mr
Edward Sulikowski

The importance of the Australian-Korean economic relationship is not
well known in either country. The ROK is Australia's third largest
export market and it also ranks third in two-way trade. For many
Australian firms recognition of their lack of detailed understanding of
the business and economic environment in the ROK has been highlighted by
the unexpected severity of Korea's recent financial and economic crisis.

Once Korea resumes its normal growth trajectory, the significant
complementarities of the ROK and Australian economies should continue to
raise the ROK's share of Australia's trade. Despite this, many
Australian and Korean businesses have failed to focus on the full range of
opportunities available in each others' markets. The EAAU's
forthcoming report on the Korean economy will attempt to address these
issues, analysing the causes of the current economic crisis, the
strategies being pursued by the Korean Government to overcome it, their
likely success in restoring sustainable growth in the Korean economy and
the opportunities for Australian companies that will emerge in the Korean
market (and for Korean firms in Australia).

CHAPTER 1: Overview

Aim: This chapter will provide a self contained overview of
economic development in the Republic of Korea. After briefly reviewing
aspects of postwar economic policy, including international and regional
comparisons, attention will focus on the causes of the current economic
crisis, the strategies being pursued to restore sustainable growth and the
outlook for the economy. The chapter will underline the need for
continuing liberalisation of economic policies, identifying issues
developed in later chapters, including external and domestic corporate
debt restructuring as well as financial sector and corporate governance
reform.

Outline: Topics to be covered.

• Short economic history postwar, including a discussion of the main
  elements of the development strategies pursued
  • Liberation, Korean War and economic stagnation
  • Export oriented economic takeoff in the early 1960s
  • Government led industrialisation in the 1970s
  • Economic liberalisation since the 1980s
  • Need for ongoing economic reform
• Economic performance and structure, including international and
  regional comparisons
  • comparison with other OECD economies and Taiwan, Hong Kong and
    Singapore, divergence from OECD norms
    • economic structure
    • basic economic and social indicators, income growth,
      structural change, public sector finances, education and
      health indicators, wages, investment and savings performance
      (much of this can be in table form, possibly only a few
      tables)
  • Korea's integration with Asia and dependency on Asian markets
    • extent of trade and investment links with Asia
    • comparisons with interdependency of other Asian market
      economies
• Sources of Korean success and structural weaknesses
• Macroeconomic management and export orientation
• Investment in human and physical capital
• Legacies of government led development
• Concentration of economic power and poor corporate governance
• Weakness of financial sector
• Bureaucracy, democratisation and other institutions
• Causes of the recent economic crisis
• Increased corporate failures, heavy debt burden, "fleet"
  like management of chaebols, and recession in major export markets
• Inertia and inadequate supervision of financial institutions
• Economic mismanagement
• Implications for Korea-Australia bilateral relations
  • nature of the bilateral relationship and future prospects
  • Australian security interests on the Korean peninsular
    (contributions to KEDO)
  • Australia's contribution to IMF package, trade finance
  • other areas of bilateral cooperation (APEC, WTO, ARF)

CHAPTER 2: Political and Social Systems in Transition

Aim: To provide a self contained overview of political
developments and their likely impact on economic recovery and growth.

Outline: Topics to be covered.

• Brief political history of ROK, highlighting major factors
  determining political culture
  • creation of the first Republic
  • transition to democracy
• Recent political change, particularly since the December 1997
  presidential election
• Political capacity to meet challenges of the economic crisis
• Implications of social, cultural and economic change (growing
  consumerism, views on foreign investment and capital, health and aging
  population, urbanisation of Korean society, growing role of women in
  politics and business)
• Relations with North Korea
  • North-South Korean economic cooperation
  • attitudes to chaebols investing in North Korea
• Probability and likely economic and political consequences and costs
  of North Korean economic collapse and reunification of north and south

CHAPTER 3: Macroeconomic Performance

Aim: This chapter will focus on macroeconomic developments in
the 1990s, the lead up and response to the currency and financial market
crises. There is a general view that the Korean Government has done all
that the IMF has requested of it in terms of regulatory and institutional
reforms to free foreign investment and the labour market, and to address
the problems of the financial and corporate sectors. However, progress is
slow in critical areas such as foreign direct investment inflow and
corporate restructuring and scepticism remains regarding the efficacy and
implementation of many legislated reforms. The chapter will need to
discuss long term fiscal implications of depositor and creditor
guarantees, financial system restructuring and a social safety net. The
chapter will conclude with an overall assessment of likely prospects for
the Korean economy. A range of scenarios could be presented. An attachment
to this chapter will address the structure of economic policy making
within the executive, bureaucracy and legislature.

Outline: Topics to be covered.

• Brief overview of macroeconomic policy making in Korea
• the responsibility of past macroeconomic policies for the current
  crisis
• it could be argued that poor economic management, particularly since
  the early 1980s led to the creation of asset price bubbles with
  adverse impacts on productivity growth and international
  competitiveness
• Review macroeconomic management experience and issues in 1990s,
  particularly the lead up and response to the currency and financial
  market crises, including
  • nature of the unfolding crisis, impact on currency, foreign
    reserves, interest rates, economic activity, employment and
    liquidity, and the reaction of foreign creditors
  • IMF package, conditionality embodied in IMF memorandum of
    understanding and planned disbursements, including by other
    participants
  • major policy responses by the ROK government to date and planned
  • targets for growth, inflation, budget deficit, debt roll-over,
    external account and reserves (IMF and government) and projections
    for these variables (government and private sector)
• Fiscal policy and public finances, 1990-98
  • public and private savings, consumption and investment trends
  • recent fiscal policy experience 1990-98, highlighting concept of
    consolidated fiscal balance
  • anticipated impact on fiscal policy and consolidated fiscal
    balance of the recent IMF package and depositors' and creditors'
    guarantees, and purchase of non-performing assets of the financial
    sector
  • adequacy of social welfare and infrastructure spending,
    particularly in light of crisis, fiscal implications
  • implications of costs of financial sector restructuring for
    taxation reform, recent, proposed and required, particularly
    focusing on implications for financial sector restructuring and
    reform, fiscal balance
  • promoting efficiency in public enterprises
    • prospects and proposals for privatisation of public
      enterprises (POSCO, KEPCO, Korea Telecom, Korea Gas Corp) and
      implications for their future operations and input suppliers
      like Australia
• Monetary policies
  • overview of monetary policy since 1990
  • impact on monetary policy execution of recent developments in
    monetary policy mechanisms, including floating of the won, freeing
    of interest rates, and financial system reform
  • analysis of IMF high interest rate policy and strict monetary
    policy and its success
  • impact on monetary policy implementation of recent changes in
    institutional arrangements, including the establishment of the
    Financial Supervisory Commission and re-allocation of authority
    from the Bank of Korea
  • likely future developments in these mechanisms and impacts
• Foreign exchange and balance of payments policies
  • evolution of the foreign exchange regime pre and post the onset
    of the crisis
  • impact of the previous system on hedging activity of those
    borrowing abroad, extent of unhedged debt
  • trends in and sustainability of foreign debt levels, measures
    taken to roll-over and renegotiate foreign debt, terms and success
    rates
• Overall assessment and outlook for economy
  • progress in deregulation and movement to a freer, more market
    oriented economy, likely impact on future growth
  • impact of high interest rate regime and liquidity crunch on
    economic activity, extent of and trends in corporate exposure to
    foreign and domestic debt (including unhedged debt), extent of
    leveraging
  • medium to long term growth and unemployment
    projections/scenarios
  • consensus economic forecasts (growth, inflation, unemployment,
    trade)

Attachment: Economic Policy Formulation

This attachment will address the structure of economic policy making in
Korea under the new administration. Two notable features of the current
arrangements are the concentration of economic decision making power in
the hands of the President and his advisers in the Blue House, and the
re-allocation of responsibilities away from the traditional economic
ministries and institutions to new bodies like the Financial Supervisory
Commission.

• Economic policy formulation in the new administration
  • institutional arrangements, allocation of responsibility and
    power between the executive and legislature
  • changing roles in central economic ministries
  • input by other key economic policy decision makers, including
    research institutes, think tanks, advisers and others
  • changes in the roles of government and financial and corporate
    sectors in economic decision making.

CHAPTER 4: Financial Market Management

Aim: This chapter will review past steps towards financial
sector deregulation and assess progress in undertaking essential
regulatory changes and developing the necessary `infrastructure' to tackle
the major financial sector restructuring task. In the financial sector,
the crucial development has been the establishment of the Financial
Supervisory Commission charged with the task of overseeing financial
sector prudential control and restructuring. A high proportion of
commercial bank lending in Korea is secured by real estate which must be
liquidated in the restructuring process. While the Korea Asset Management
Corporation (KAMC )will be the central mechanism used to purchase
non-performing loans, the key issue will be the extent of funding
required, where these funds will be raised and who will bear the ultimate
cost. One major uncertainty is the extent to which Korean banks will
attract foreign direct investment. For example, later this year the
Government must sell to foreign (or domestic) buyers Korea First Bank and
Seoul Bank which were effectively nationalised as part of their earlier
rescue by the Government. Progress on these sales will help determine
whether the Korean Government or foreign investors will shoulder the bulk
of the bank recapitalisation cost, and whether the IMF will accept further
bank nationalisations. The scale of the corporate
restructuring/recapitalisation also will be addressed in this chapter. A
key issue is whether capital available from domestic and offshore equity
raisings, asset revaluations and foreign direct investment/asset purchases
will be sufficient. The chapter will analyse whether necessary policy
reforms will occur and therefore which of the alternative sources of funds
will be dominant. Candidates include aggressive corporate and financial
sector asset sales to domestic and foreign sellers, debt forgiveness and a
major government/taxpayer funded bail-out, beginning with the financial
sector.

Outline: Topics to be covered.

• Situation pre-crisis (particularly 1990-97) in the financial sector
  - directed lending, over leveraging, interest rate ceilings,
  restrictions on foreign participation
• Steps towards financial sector deregulation up to 1997
  • financial institutions
    • relations between Government and the banks - formal and
      informal linkages and influence
    • legacy of past intervention in bank lending (policy directed
      lending)
    • bad debts, inefficiency, financial institution failure
  • interest rates controls and deregulation
  • capital market liberalisation, remaining segmentation and
    controls, recent reforms, remaining issues
  • deregulation of international capital flows, remaining controls
  • financial flows to and from the region via Korean and foreign
    banks
    • impact of financial flows on Korean financial and corporate
      sector (eg. Japanese, US and European lending to Korean banks
      and corporates, Korean bank lending to ASEAN countries)
• Government's financial sector restructuring program - post onset
  of the crisis
  • recent and ongoing restructuring of financial institutions and
    enhancing market forces
  • reforms achieved and planned in the financial sector, including
    • role of the Financial Supervisory Commission in financial
      sector supervision and restructuring
    • role of Bank of Korea and Ministry of Finance and Economy
    • measures taken to improve transparency and their adequacy
    • measures to tighten prudential control, and their adequacy
    • increased commercial orientation of banks, measures taken,
      future requirements
    • definition and provisioning requirements for non-performing
      loans, measures to date
    • liberalisation of foreign access to the banking and non-bank
      sector, stock exchange and corporate bond market
    • relaxation of other constraints on foreign and domestic
      competition in financial markets and ease of mergers and
      takeovers of financial institutions
    • extent of policy reforms undertaken or in prospect to assist
      corporate and financial sector refinancing (eg relaxation of
      constraints on foreign ownership of land, reform of bankruptcy
      laws and more effective implementation, tax reforms to
      facilitate bank write-offs, etc)
• Korean corporate restructuring
• inter-relationships of chaebol and financial sector problems in the
  current crisis
• incentives and sanctions employed to spur corporate restructuring
• sequencing and linkages of restructuring to financial sector
  restructuring (cross effects)
• de-leveraging corporates through debt equity swaps
• impact of removal of cross guarantee of loans
• Costs of financial sector restructuring
  • alternative estimates of the costs of recapitalising the banks,
    guaranteeing depositors and foreign bank creditors
  • role of Korea Asset Management Corporation
  • likely availability of capital for refinancing from domestic and
    offshore equity raisings, asset revaluations and foreign direct
    investment/asset purchases.
  • funding and strengthening the existing deposit insurance scheme
  • anticipated burden on the budget.
• Problem bank resolution, methods planned, achievements to date and
  prospects
• P & As (purchase & assumption)
• M & As (mergers & acquisition)
• Liquidation
• Recapitalisation of surviving banks and non bank financial
  institutions
• sources of new capital
• foreign ownership
• corporate ownership
• government ownership
• Long term prospects for financial sector recovery and reform
• Profile of banking into 21^st Century
• industry structure
• customer and product structure
• profitability
• prospects for foreign financial institutions in Korea

CHAPTER 5: Trade Policy and Performance

Aim: Korea is subject to strong pressure from major trading
partners to liberalise its trade regime. While the country is making
significant progress in opening markets to international competition,
Korea's trade policy still carries remnants of earlier developmental
mercantilism. This chapter will discuss the development of trade policy in
Korea, examine the current and likely future trading environment, and draw
out implications and trade policy options for Korea. This chapter will
assess the competitiveness of the traded goods sector in Korea
(particularly against Japan, China, ASEAN and Taiwan) and evaluate
prospects for export recovery over the medium term. The chapter also will
analyse in some detail long term trends in Australia's exports to Korea,
examining factors affecting Australia's trade performance as well as the
impact of the currency and economic crisis on trade. The chapter will
investigate Australia's performance in the Korea market for selected
exports, look at strategies to develop particular markets and expose new
opportunities for Australian business.

Outline: Topics to be covered.

• Evolution of trade policy in Korea, brief history, mainly focusing
  on 1990-98 period
  • level and nature of protection, including for agriculture
  • tariff rates for major goods during 1980s and 1990s
    (graph/table)
  • major non-tariff measures (text/table/box)
  • evaluation of trade liberalisation progress in past decade or so
  • trade reforms since the onset of the crisis and anticipated
    future reforms
  • reforms required by IMF stand-by agreement
  • reforms initiated by Korean government
  • major areas remaining to be reformed, including agriculture
• International trading environment facing Korea into next century
  • reaction to globalisation, increased trade competition, and
    structural and technological change in the 1990s
  • services trade developments
  • impact of regional trade alignments (European integration,
    NAFTA, AFTA) on Korean trade performance
  • implications of a new WTO round, particularly for agriculture
    and services
• Prospects for Korea's trade structure
  • 1990-98 growth trends and outlook, by trade category (2 digit
    SITC level) destination and source
  • shifts in patterns and directions of trade and emerging trends
  • changes in Korea's economic linkages with East Asia, North
    America, Europe and Australia
  • impact of Asian financial crisis on Korea's trade patterns,
    including changes in international competitiveness of Asian and
    Korean exports and impact on Korean trade performance
  • prospects for Korea's exports and imports 1999-2001
  • trends and prospects for the current account
• Trade policy options for Korea
  • continuing progress on trade liberalisation
  • trade liberalisation commitments under WTO and APEC
  • trade liberalisation measures required by IMF loan conditions,
    including removal of trade related subsidies, and abolition of
    import diversification system
  • issues related to exchange rate policy - role of exchange rate
    adjustment in managing current account problems
• Australia Korea Trade Relations
  • overview of Australia-Korea bilateral trade relations
  • current trade strategies
  • analysis of major factors affecting bilateral trade including
    market access issues, complementarity, international competition
    and competitiveness and resulting market penetration
  • analysis of areas of most rapid growth and new opportunities,
    focussing on prospects in key sectors including
  • processed and unprocessed food and agricultural products
  • bulk energy and mineral commodities.
  • elaborately transformed manufactures
  • tourism
  • educational services
  • financial, professional and other services
  • housing
  • environmental services
  • third country cooperation opportunities for Australian and
    Korean firms (eg in China)
  • cooperation between Australia and Korea in APEC and other trade
    and economic fora.

CHAPTER 6: Business Environment - Korean Business Culture in
Transition

Aim: This chapter will focus on the nature of the Korean
business environment, business culture changes and recent developments
under the new administration. The chapter will address implications for
the Australian government and the business community. The chapter will
include case studies of Australian firms in the Korean market.

Outline: Topics to be covered.

• Cultural background to business
  • main features of Korean culture as they affect business
  • changes to the business culture post crisis
• Major factors attracting foreign businesses, major problems faced
  and recent changes
• how business ranks Korea in the region
• major barriers and obstacles to business
• government attitude towards foreign investment, changes with Kim
  Dae-jung Administration
• changes to industrial policy and implications for foreign companies
• Operating environment
• market characteristics and trends
• understanding the market
• nationalism and market opening
• forms of doing business (branches, joint ventures, franchises etc)
• advertising and media
• infrastructure and facilities
• distribution
• role of chaebols as a bridge to the market
• Regulatory environment, focusing on recent changes
• dealing with the bureaucracy
• taxation and tax incentives
• controls on foreign ownership
• accounting and financial reporting
• banking and finance
• access and developments in trade financing
• foreign exchange administration
• labour force and labour management relations
• fostering small and medium sized enterprises
• dealing with the legal system
• dispute resolution mechanisms
• protection of intellectual property rights
• environmental regulation
• Defining a successful company in Korea
• including strategies for successful companies
• Strategic implications for Australian companies
• including identifying areas of opportunity for Australian companies

CHAPTER 7A: Foreign Investment Regime : Constraints and
Opportunities

Aim: The Government's plans for further liberalisation of
foreign investment are of considerable significance and will have a major
impact on the Korean economy. Abolishing the law banning non Koreans from
acquiring land in Korea and allowing hostile mergers and acquisitions are
particularly significant for foreign investors. These changes threaten to
be a sensitive issues, in view of both, the strength of Korean nationalism
and the perception that in the aftermath of the crisis foreigners will be
able to buy Korean assets at fire-sale prices.

The chapter also will examine the nature and level of Australian
investment in Korea and opportunities for Australian business.

Outline: Topics to be covered.

• Foreign investment regime
  • recent and proposed liberalisation in controls
    • transparency
    • national treatment
    • sectoral restrictions
    • arbitration and dispute settlement
    • foreign land ownership
  • promotion of inward FDI
  • expansion of investment incentives
  • streamlining of investment procedures
  • provision of one stop services
  • remaining restraints on inward FDI flows
• Laws on friendly and hostile takeovers by local and foreign firms
  • mergers and bankruptcies
  • prospects for further liberalisation
• Sectoral distribution and sources of foreign investment inflows into
  ROK (pre and post currency crisis)
  • trends and likely future prospects
• Destination and trends in foreign investment outflows from Korea
  • chaebol strategies pre-1997 and likely strategies in 1998 and
    beyond
  • restrictions on and incentives for outward FDI flows
• Nature of Australian FDI in Korea
  • recent trends/sectoral distribution
  • medium to long term opportunities and prospects due to recent
    reforms and relaxation of controls
• Trends in Korean FDI in Australia
• sectoral distribution (1990-98)
  • employment and income generated
  • major attractions for Korean investors
  • constraints, short term responses to the Korean financial crisis
    and prospects in the medium to long term

CHAPTER 7B: Survey and Analysis of Australian (and as necessary US
and European) FDI Presence in the ROK

Undertake a survey of 40+ Australian, US and European businesses who
have invested in Korea, analyse the results and write chapter 7B of the
report. Chapters 7A and 7B aim to provide a thorough examination of
Australian FDI in Korea. The more general influences on Australian and
other FDI in Korea, such as its scale and sectoral distribution and the
general regulatory environment, will be considered in Chapter 7A. The
major resource for this chapter will be a survey of Australian and other
foreign investment in the ROK, the results of which will then be analysed
to understand the motivation and the issues confronted by Australian
investors in Korea.

PART A: Survey

• and structure of companies surveyed
• Size of investment, initial and additional investment
• Undertake a formal questionnaire survey of 40+ firms, including all
  Australian firms with significant investments in Korea and US and
  European businesses in similar sectors to existing Australian
  investment. The EAAU will provide names of Australian companies to be
  surveyed.
• The survey questionnaire will be developed in consultation with the
  EAAU.

PART B: Analysis of survey results and preparation of report
Topics covered will include

• Characteristics Important factors in companies' decision to invest
  in Korea
• Impediments to Australian companies investing in Korea
• Length of negotiations to establish new investment
• The profitability of Australian investment in Korea
• do profits and expansion achievements measure up to expectations
• plans for future investment
• Market entry and development strategies adopted by various
  Australian firms
• case study of 2-3 successful firms
• Expectations about future market prospects, in next 2-5 years
• Strategic implications, and opportunities for Australian companies.

CHAPTER 8A: Industry and Competition Policies

Aim: The chapter will focus on the extent of market
concentration, highlighting the role of the chaebol, the remaining
constraints on competition by domestic and foreign firms and the
implications for foreign investors. On the corporate side, the government
is putting pressure on the chaebols, via the banks, to deliver meaningful
restructuring plans. With the Government dissatisfied with the earlier
proposals put to it, the chaebols have been asked to develop revised plans
as part of a contractual arrangement with their main banks to improve
their capital structures. The chapter will assess the extent to which
chaebols are seriously tackling the restructuring task. Significant
managerial and structural changes have been made by some of the chaebols,
and most are looking to sell off `non core' assets. A key question
however, is whether the chaebols will need to sell good performing core
assets in order to restore their balance sheets and whether they will be
willing to do so.

Outline: Topics to be covered.

Restructuring of Korea's Corporate Sector and Related Policy
Issues with Special Reference to Chaebols

• Rationale of chaebol regulations since the mid-1980s until December
  1997
• Role of chaebols in Korean economy.
• The extent of chaebol concentration.
• Current status of corporate restructuring in Korea:
• Situation of failing corporations and surviving corporations and
  understanding of corporate exit in Korea.
• The speed and scope of restructuring of the surviving corporations
• Role of the Korean government in corporate restructuring; policy and
  legal issues in corporate restructuring
• The interaction between financial reform and corporate
  restructuring, including the role of financial institutions in
  expediting chaebols' restructuring.
• Bankruptcy laws and procedures, moral hazard due to the 'too-big-to-fail'
  perception, the recent reform of the bankruptcy law and IMF
  requirements in this regard
• Policy reforms and issues in corporate accounting practices and
  corporate governance
• Role of chaebols in their own restructuring (including
  specialisation and management reform).
• Role of foreign capital in restructuring corporate Korea.
• Evolving government-bank-chaebol relationship in Korea.
• After the restructuring? - likely success of new policies and future
  prospects for Korean chaebols.

Industrial Development and Industrial Policy

• A review of industrial development and industrial policy in Korea's
  government-led, big-business-oriented growth.
• Repression of the financial sector, labour, taxpayers and consumers.
• Government regulations and industrial policy (license and permit
  system, entry and exit regulation, investment and ownership
  regulation, price control, red tape and corruption under the name of
  social and administrative regulation).
• The interaction between industrial policy and chaebols.
• Industrial policy and market protection.
• Costs and benefits of the interventionist industrial policy.
• Future prospect for industrial policy after the economic crisis.

Competition in Korean Markets and Competition Policy Issues

• A review of market competition and history of anti-trust legislation
  in Korea.
• The extent of individual market concentration and overall
  concentration.
• Regulatory reform, privatization of state-owned and -controlled
  enterprises and the scope of competition policy in Korea.
• The achievements and limitations of Korea's anti-trust law
  enforcement.
• Constraints to competition from chaebols, trade associations,
  foreign firms and implications for foreign investors.
• Future prospect for competition law and policy in Korea, including
  deregulation and privatization.

Synthesis and Conclusions

CHAPTER 8B: Reform and Deregulation of Korea's Labour Market

The chapter will also discuss labour market reform and
deregulation, and the implications of industrial relations for economic
recovery prospects. The chapter will also deal with other labour market
issues, including increasing the flexibility of labour hiring and firing
and practices and remuneration measures. In addition, the Government's
ability to deal effectively with the unemployment problem will be crucial
to its ability to carry through on its promised reform agenda.
Improvements to the social safety net are needed if community concerns
about unemployment are to be dealt with effectively.

Outline: Topics to be covered.

• Labour issues during the economic crisis
  • The rise in unemployment and income inequality (brief, 1-2
    tables), outlook for unemployment.
  • Impact of the economic crisis on labour market policy and need
    for flexibility
• Labour policies and issues
• Brief history of labour market policies
• The effects of product and financial sector distortions on the
  labour market, including supporting data
  • Women and youth in the labour market
  • Government regulation of labour market, focusing on recent
    reforms
  • measures to improve labour market flexibility, including
    enhanced capacity to dismiss workers
  • current government programs for the unemployed
    • expanding unemployment benefit coverage, minimum wage and
      other labour legislation
    • improving labour force training and job placement services
  • Role of collective bargaining
  • extent of union coverage
  • wage and employment structures resulting from collective
    bargaining and likely future changes
  • union's role in wage and employment determination
  • labour disputes and conflict resolution
• Future prospects for industrial relations
• The non-unionised labour market, wage and employment tenure
  conditions
  • Human resource development, including recent developments and
    prospects for educational reform
  • Prospects for further reform of the labour market, including
    likely impact of labour relations, trade union militancy on labour
    market reform and implications for business

Social policies

• impact of economic crisis on social policies polices (brief)
  • agenda for reforms in pension schemes and health care (brief)

CHAPTER 9: Conclusions and Implications for Enhancing Australian
-Korean Relations

Aim: Conclusion.

Outline: Topics to be covered.

• Major economic policy challenges for the ROK government over the
  next decade
• Challenges and opportunities for the bilateral Australia-Korea
  relationship
  • major economic factors affecting trade performance
  • impact of financial crisis
  • market access issues pursued by the Australian Government, trade
    and investment barriers
• Possible new government initiatives to enhance bilateral relations
• Business strategies and initiatives to increase mutual benefit from
  trade and investment relations
  • market access issues
  • trade opportunities in gods and services
  • emerging investment opportunities in Korea

Business activities of major chaebol in Australia, interests and
opportunities,cooperation in third markets

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