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Doing business in South Korea getting harder: EU firms
[SEOUL] More than three in five European Union executives say doing business in trade-dependent South Korea - Asia's fourth-largest economy - has got harder, a survey showed Tuesday.
Respondents to the EU Chamber of Commerce in Korea cited rising labour costs, ambiguous rules, market access, and inconsistent application of regulations as issues, urging more transparent policymaking and improved rule of law.
"Initiatives to support business such as deregulation seemed to have phased out," the organisation said in its Business Confidence Survey.
President Moon Jae-In came to power last year promising reforms in several areas.
But the ECCK said: "Not much progress has been made in terms of substantial changes referring to improvements in business and international trade." A total of 108 company executives, representing a combined workforce exceeding 30,000 employees and a total turnover of EUR 28 billion, answered the survey in November.
The Korean market was increasingly strategically important, said 44 per cent.
But 61 per cent "feel that doing business in Korea has become more challenging than two years ago", the ECCK said.
South Korea's overall economic growth - which reached 3.1 per cent last year - has consistently ranked as the top business challenge since the survey was launched in 2014.
This time 86 per cent ranked it has highly or partially significant for their business, up from 74 per cent.
Rising labour costs were named as a key challenge by 73.1 per cent of respondents, followed by ambiguous rules and regulations with 69 per cent.
Respondents were able to select more than one option.
Market access barriers and "discretionary enforcement" of regulations were new entrants in this year's list of top five business challenges.
"The feedback from company leaders also states that efforts are needed to better the rule of law/transparent policy making, fair competition and domestic consumption", the ECCK said.