The Korea Times

BRIC markets hit by US crisis

Global markets again saw volatility as an increase in U.S. initial jobless claims and a rise in consumer prices pushed the U.S. stock markets sharply lower. Renewed market rumors that some European banks may face funding concerns also weighed on global market sentiment. The risk that the European debt crisis may spread to Italy and Spain, the U.S downgrade and the Fed’s promise to keep interest rates low for the foreseeable future haven’t gone down well with investors. Increasing fear over the U.S. moving into recession has kept the markets on tenterhooks. China The Hong Kong/China market traded higher earlier in the week but gains were erased as global market sentiment took a battering. Apart from ongoing concerns over the health of the European financial system, a slump in the U.S. Philly Fed Index raised worries that the U.S. could be nearing a recession. Chinese Vice Premier Li Keqiang visited Hong Kong and announced new policies that will help internationalize the RMB. On the financial front, it was revealed that exchange-traded funds holding Hong Kong-listed stocks

Aug 21, 2011By Kim Jae-kyoung

Economy

Retail property management

Leasing is better option for shopping malls than selling in parcels By Andy Lee In August of 2009, the Noon Square shopping mall in Myeongdong was newly reopened after renovation by its owner. The shopping mall used to be sold in land parcels to retail shops. However, when it reopened in 2009, it started leasing instead of selling in parcels. The successful opening of the mall had a special meaning to me because I had strongly advocated leasing of shopping malls. The key to Noon Square’s success was carefully selecting the types of tenants and brands of the retail shops in order to differentiate itself from other shopping malls in Seoul. The types of tenants are wide ranging, from famous overseas brands such as H&M, ZARA, Mango, Charles & Keith to local designers’ shops. It also includes a cinema, book store and restaurants. Due to the strategy, Noon Square has had a constant occupancy rate of 100 percent since its opening while the average vacancy rate in Myeongdong is around 10 percent. I have emphasized the importance of leasing shopping malls for a long time because s

Aug 21, 2011By Kim Jae-kyoung

Economy

Korean firms lag behind in branding

By Reiji Ohtaki, Ph.D. The easiest way to ascertain whether or not a company is competitive is to see if excellent talent is interested in joining the company. It is not even necessary to study its financial statements or market share. No talent would choose to join a useless company and go through difficult processes intentionally. Top talents are eager to join a good company to learn from excellent colleagues. This logic means great companies attract excellent talents, which further improves their corporate results as well as the popularity of the companies. The same logic applies to poor companies ― they cannot attract talent, so their results never improve. In fact, many Asian companies in developing nations are caught in this common vicious circle. In September 2008, JobStreet.com, the biggest job-search website in Southeast Asia, and Aon Consulting (now Aon Hewitt) conducted an online survey of white-collar workers, aged 21 to 40, in ASEAN countries and India to study the popularity of MNC’s (multinational companies), based on their country of origin. The result from

Aug 21, 2011By Kim Jae-kyoung

Economy

Rewrite the rules of the game

By Park Sang-soon Fundamental changes in client behavior are rewriting the rules of the game for wealth managers. In many markets the crisis has been so severe that some changes could become part of the “new normal” for asset managers. Their success will therefore depend on the ability to adapt to the new behaviors exhibited by investors. Especially in Asian Pacific markets including Korea, client behavior has changed a lot. First of all, before the crisis, complex structured products were a key driver of growth for wealth managers in the Asia-Pacific (AP) region. Many investors, alarmed by the scale of the financial crisis, have since shifted assets into simple, low-margin products, undercutting the ROAs of many wealth managers. To spur growth and improve gross margins, wealth managers need to explore opportunities to create new and innovative products. Sophisticated products have suffered some of the biggest losses during the crisis. Structured products were undone by counterparty failure and the resulting loss of confidence in these vehicles. Products that had seemingly

Aug 21, 2011By Kim Jae-kyoung

Economy

Shaping a new tomorrow

Global wealth continues to grow following financial crisis By The Boston Consulting Group Global wealth grew in nearly every region of the world in 2010, with assets under management (AuM) showing signs of a sustained recovery in both developed and emerging markets. Propelled by growth in nearly every region, AuM continued a solid recovery in 2010, increasing by 8.0 percent, or $9 trillion, to a record of $121.8 trillion. That level was about $20 trillion above where it stood just two years prior during the depths of the financial crisis. North America had the largest absolute gain in wealth, at $3.6 trillion, and the second-highest growth rate, at 10.2 percent. Its $38.2 trillion in AuM made it the world’s richest region. In Europe, wealth grew at a below-average rate of 4.8 percent, but the region still gained $1.7 trillion in AuM. North America surpassed Europe as the wealthiest region in part because its capital markets had a stronger recovery, but also because the euro lost value relative to the dollar in 2010. Wealth grew fastest in the Asia-Pacific region (excludin

Aug 21, 2011By Kim Jae-kyoung

Economy

Finding a blue ocean

Korea moving to sign package deals with Colombia, Ethiopia By Kim Jae-kyoung Following the 2008 financial crisis triggered by the U.S. subprime mortgage meltdown, there are two major trends dominating the global economy at both the national and corporate levels. One is that governments and companies are trying to look further into the future to secure new growth engines for business sustainability. The other is that they are stepping up efforts to find untapped markets where they can take advantage of low costs and ample resources, with China’s rising labor costs erasing savings from the past. Simply put, the central stage of the global economic war has been moving from a “red ocean” to a “blue ocean,” which refers to uncontested market space that holds great opportunities. This means that the world is facing an uphill battle over dwindling energy and other natural resources and eventually the expansion of their economic territories. In fact, blue ocean, the term coined by W. Chan Kim and Renee Mauborgne, both professors at INSEAD, is gradually diminishing as China ha

Aug 21, 2011By Kim Jae-kyoung

Economy

Business evolution

B2B marketplace changes landscape for global trade By Kim Jae-kyoung Hwang Sun-bong, president of Bluedra, a local trade company based in Gangnam, southern Seoul, succeeded in exporting agricultural machinery worth $24,000 to Afghanistan in 2009 when the central Asian country was in the middle of a war. With a total of five employees and annual exports of $1.5 million, the small firm specializing in agricultural machinery and light construction equipment has since expanded its exports to the war-torn country and is now shipping goods there worth $50,000 every year. What is the secret behind the small firm’s success? Hwang’s answer was simple but clear, “B2B (business to business) e-commerce,” under which firms sell and buy products and services through international online marketplaces, such as Alibaba.com and Tradekey.com. Bluedra has been doing business with Islamic countries over the past two decades through a Japanese agent based in Dubai. However, what brought the successful deal to the company was not its agent but an e-commerce website. Hwang said that its pa

Aug 12, 2011By Kim Jae-kyoung

Alibaba fixes sights on Korean market

Economy

Using the power of managers in acquisitions

By Towers Watson Our 2009–2010 Global Workforce Study showed some significant differences in how employees in different regions of the world view a merger, ranging from concern in North America to optimism in Asia. North American respondents who had been through a merger in the previous 12 months tended to see deals as likely paths to job cuts, to feel that their prospects had worsened and to believe that their manager was less effective. Those in Europe were somewhat more positive about both the deals and the effectiveness of their managers, but felt that their job prospects had worsened. In Asia, however, the picture differed markedly. Respondents were optimistic about the prospects a deal offered them and believed their managers were effective during the deal-making process. Despite these differences, however, respondents who had experienced a merger ― regardless of location ― were more likely than other respondents to be actively looking for a job or open to possible offers. They were also more likely than other respondents to feel that their manager, and t

Aug 12, 2011By Kim Jae-kyoung

Economy

M&A deal in China

How to tackle unique integration challenges and achieve success By Marco Kaster Despite the unevenness of the economic recovery, corporate earnings are up substantially and many companies are posting significant profits. With large cash positions, the strongest players are looking for investment opportunities to build their businesses, keeping overall merger-and-acquisition (M&A) transaction activity healthy. In fact, after an M&A surge in 2010, all signs point to continued positive momentum for the remainder of 2011 and into 2012. Both our own research and data from external sources show increased activity across borders and regions of the world, with more companies buying into emerging economies, specifically Russia, India, Brazil and China. No M&A deal is seamless, of course. The magnitude of change inherent in any transaction has a significant impact on the workforce, and that can affect the success of the deal itself. This can range from losing key employees or skill sets (often a reason for deals in the first place) to disruptions in customer service to frustrati

Aug 12, 2011By Kim Jae-kyoung

Economy

Alibaba fixes sights on Korean market

_ World’s 13th-largest economy has potential to become e-commerce powerhouse By Kim Jae-kyoung Korea ranks 9th in the world in terms of export volume, but the world’s 13th-largest economy is lagging far behind in international online trade with only a few small- and medium-sized enterprises (SME) in the cyber marketplace. A global business-to-business (B2B) e-commerce expert said that although Korea is developing slowly, the country has great potential to emerge as one of the fastest-growing markets, citing its high Internet usage and quality of Korean products by SMEs. “Korea already has full internet penetration nationwide and relatively high e-commerce adoption. With a sophisticated e-commerce infrastructure already in place, Korea has great potential to grow in this sector,” Timothy Leung, channel sales director of global sales at Alibaba.com, told Business Focus. “This, coupled with the generally high quality, trendy design and competitive pricing of Korean products, gives Korean SMEs an edge in the global market,” he added. “We find that Korean SMEs are building

Aug 12, 2011By Kim Jae-kyoung

Kim Jae-kyoung

Read more

BRIC markets hit by US crisis

Retail property management

Korean firms lag behind in branding

Rewrite the rules of the game

Shaping a new tomorrow

Finding a blue ocean

Business evolution

Using the power of managers in acquisitions

M&A deal in China

Alibaba fixes sights on Korean market

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