Industries show mixed reactions to poll results
By Kim Tae-gyu
The automotive industries are smiling while high-tech businesses grimace after the governing Saenuri Party chalked up an unexpected victory in this week’s National Assembly elections.
As the ruling party has strongly supported free trade agreements (FTA), exporters including carmakers and shipyards are expected to see their price competitiveness improve in global markets.
“Major exporters might have let out a sigh of relief at the triumph of the FTA-friendly Saenuri Party. Their nightmare would be a situation where opposition parties take issue with the FTA with the United States (KORUS FTA) as they have threatened to do,” a Seoul analyst said.
“However, the campaign against the KORUS FTA will lose steam as the main critics were defeated in the election.”
The opposition parties have contended that the deal between Korea and the United States should be re-examined since they claimed that it overly favors Washington at the expense of Seoul.
Their loss in the elections is expected to silence them and as a result, the main beneficiaries of the KORUS FTA, the country’s leading exporters such as Hyundai Motor and Hyundai Heavy industries, are predicted to improve their performance in the future.
Hyundai Motor is the largest automaker in Asia’s fourth-largest economy while Hyundai Heavy is the world’s foremost shipyard.
In addition, the conservative Saenuri Party has been more business friendly than opposition parties even though there have been some doubts on the former’s policies concerning top conglomerates.
In comparison, Samsung Electronics, the country’s biggest firm with the largest export volume, would see the election result as, at best, a mixed blessing due to the stance of leading Saenuri Party campaigner Park Geun-hye.
Park, chairwoman of the ruling party’s interim leadership body and one of the foremost candidates to be the next president, spearheaded the success of the Saenuri Party at a time when it was expected to suffer a devastating defeat.
She showcased her strong stewardship over the elections, projected to boost her bid in the presidential poll later this year.
If the daughter of former President Park Chung-hee wins, the news might disappoint the country’s information technology industries, many of which have been looking to opposition parties’ promises to boost the sector.
The country’s information technology sector experienced great support from the previous two presidents but incumbent President Lee Myung-bak has come under fire for not caring as much for the lucrative area.
The current administration scrapped the Ministry of Information and Communication just after its inauguration in early 2008 and that led to criticism that the lack of an information technology control tower has resulted in worsened competitiveness of domestic firms in this area.
In this climate, opposition parties have come up with pledges that they would revive the information-communication ministry if they win the presidential election, promises that are unlikely to be kept if Park is victorious in December.
The Saenuri Party has also said that it plans to bolster the information technology industries.