09 July 2010

HISTORICAL BACKGROUND ABOUT THE KOREA

FACTS ABOUT KOREA II

Area: 100 140 km sq.
Population: 50 062 000 (24th) (2009)
GDP: (PPP) $ 1.344 trillion (13th) (2008)
Currency: KRW (South Korean won)
Internet Domain: .kr

HISTORICAL BACKGROUND

5th Century: Silla Kingdom,
Gogyryeo Kingdom, Baekje
and present Seoul:
settlements nearby the
Han and Amnokgang rivers

There are 7 Types Of Administrative
Divisions in KOREA

Cities (Si, 시)
Counties (Gun, 군)
Districts (Gu, 구)
Towns (Eup, 읍)
Townships (Myeon, 면)
Neighborhoods (Dong, 동)
Villages (Ri, 리)

3. SPECIAL CITY ADMINISTRATION

Seoul (서울)

Capital and largest city of Republic of Korea.
Seoul is divided into 25 Gu
522 Administrative Dongs
Seoul's influence in Business, International Trade, Politics, Technology, Education and Entertainment
One of the world's top ten financial and commercial centers.
World's largest conglomerates, such as Samsung, LG and Hyundai-Kia.
Asia's most expensive city to live in 2007, and the third most expensive city worldwide

Busan (부산시)

Second largest metropolis after Seoul
15 major Administrative districts “Gu (구)”and a single County “Gun (군)”
Busan is home to the world's largest department store, the Shinsegae Centum City
Pursuing a large number of multi-skyscraper projects, including the 110-floor, 510m-supertall Lotte Super Tower, which is slated to become the world's third tallest building in 2013.
In 1876, Busan became the first International Port in Korea
It is the largest port city in South Korea and the Fifth Largest Port in the world

Incheon (인천시)

Incheon is divided into 8 wards ("gu") and 2 counties ("gun").
Country's largest airport, Incheon International Airport.
On September 15, 1950, during Korean War, United States & United Nations troops landed
Incheon Landing Operation Memorial Hall- small museum dedicated to Weapons and artifacts from the war.
Chinatown is Korea's only official Chinatown.

Daegu (대구시)

Daegu is divided into 7 wards (Gu) and 1 county (Gun).
Manufacturing industries like textiles, metals and machinery.e.g, Seongseo Industrial Complex, West Daegu Industrial Complex, Daegu Dyeing Industrial Complex
Many companies, Daegu Bank, Korea Delphi, Hwasung corp., and TaeguTec are headquartered in this city, and Samsung and Cheil Industries were born here
Quality of the apples & oriental melon grown around the city is renowned around Korea
Hottest area in South Korea due to humid subtropical climate.
Well-known sight of the city is the stone Buddha called Gatbawi on the top of Gwanbong, Palgongsan. It is famous for its stone hat.

Gwangju(광주시)

Gwangju is divided into 5 districts ("Gu").
Gwang (광) means "light" and Ju (주) means "province." Because city gave birth to GASA, a form of Korean classical poetry
Also famous for its rich and diverse cuisine.
Top class universities like Chonnam National University, Chosun University, Honam University and Gwangju University
Gwangju Institute of Science and Technology

Daejeon(대전시)

Daejeon is divided into 5 wards ("Gu").
Being known as the Silicon Valley of Korea
Within the city limits lies Daedeok Science Town, an area with more than 200 research institutions includingSamsung, LG, Korea University of Science and Technology, KAIST and Chungnam National University. .
According to Boston Consulting Group nations leading in innovation, Korea was ranked number two, just below Singapore.
Daejeon World Cup Stadium was constructed in preparation for the 2002 FIFA World Cup.
Daejeon is a provincial center for the television, newspaper and publishing industries like KBS, MBC and TJB is a local television

Ulsan (울산시)

Ulsan is divided into 4 gu (districts) and 1 gun (county).
World's largest automobile assembly plant operated by Hyundai Motor
World's largest shipyard operated by Hyundai Heavy Industries
World's largest oil refinery owned by SK Energy
In 2008, Ulsan had a GDP per capita of $63,817 the world's third wealthiest economy if ranked

Provincial Administration

Gyeonggi-do (경기도)

Consists of 27 cities “Si”(시) and four counties”Gu” (군)
Most populous province in South Korea.
The provincial capital is located at Suwon.
Seoul—South Korea's largest city and national capital—is located in the heart of the province
Famous for its Icheon rice, Yangpyeong Korean beef, Suwon cow ribs and Korean court cuisine, and marine delicacies

Gangwon-do (강원도)

Gangwon-do is divided into 7 cities (시) and 11 counties (군)
Its capital at Chuncheon four fifths of The area are woodland. Edible alpine plants and mushrooms are harvested in these forests province is renowned for its agricultural produce, in particular potatoes and fish
Gangwon-do is known throughout Korea for its production of sundubu, a variety of soft tofu made with seawater
Mineral resources of the province include iron, coal, fluorite, limestone and tungsten.
There are hydroelectric and thermoelectric power plants

Chungcheongbuk-do (충청북도)

Divided into 3 cities (시) and 9 counties (군)
Provincial capital is Cheongju
Only land-locked province in South Korea.
The province is mostly mountainous
Province specializes in ginseng and tobacco transplanted from Virginia
Mineral reserves of gold, iron, coal, steatite, fluorite, and molybdenum, as well as marble and limestone
Beopjusanational park., the site of one of the oldest temples of Korea

Chungcheongnam-do (충청남도)

Chungcheongnam-do is divided into 7 cities (시) and 9 counties (군)
The provincial capital is Daejeon
One third of the province's area is under cultivation
220 square kilometers of exposed beach, used to produce salt by solar evaporation.
There is coal mining, but gold and silver mines are also found.

Jeollabuk-do (전라북도)

Jeollabuk-do is divided into 6 cities (시) and 8 counties (군)
Provincial capital is located at Jeonju
Largest granaries of South Korea.
Rice, important products include cotton, barley, hemp, and paper mulberry
Cattle breeding are important in the eastern plateau.

Jeollanam-do (전라남도)

Jeollanam-do is divided into 5 cities (시) and 17 counties (군)
Namak capital of the province since in 2005.
2,000 islands along the coastline, about three quarters of which are uninhabited
Marine products, in particular oyster and seaweed cultivation, are leading in South Korea.
Agricultural produce, mainly rice, wheat, barley, pulses and potatoes. Vegetables, cotton and fruits
Small amount of gold and coal is mined in the province

Gyeongsangbuk-do (경상북도)

Gyeongsangbuk-do is divided into 10 cities (시) and 13 counties (군).
Provincial capital and largest city is Daegu
Hottest province in South Korea
Homeland of the former kingdom of Silla and has retained much of its cultural tradition. A number of artists, political leaders and scholars have come from the province.

Gyeongsangnam-do (경상남도)

Gyeongsangnam-do is divided into 10 cities (시) and 10 counties (군)
Provincial capital is located at Changwon
Renowned for its cotton, sesame, and fruits
Agricultural products include rice, beans, potatoes, and barley
Country's leading fisheries are in this province

Self Governing Province Administration

Jeju-do (제주도)

Divided into two cities (Si, 시) and two counties (Gun, 군)
The two cities were further divided into thirty-one Neighborhoods (Dong, 동)
While the two counties were divided into seven towns (Eup, 읍) and five districts (Gu, 구)
The seven towns and five districts were in turn divided into 551 villages (Ri, 리).

Only special autonomous province & largest island of South Korea
This is part of plans to create the Jeju into a "Free International City
Capital is the city of Jeju
Natural World Heritage Site Jeju Volcanic Island and Lava Tubes.
Famous for hosting many conferences and international meet

Reading form as under

Government information agency: Facts about Korea, Korean overseas information office, Seoul 2006, ISBN 89-7375-008-9 03910
http://www.mopas.go.kr/gpms/view/english/local/local02.jsp Ministry of public administration and security
http://www.unescap.org/huset/lgstudy/country/korea/korea.html UNESCAP
http://www.economicexpert.com/2a/Administrative:divisions:of:South:Korea.htm Macro-economy research portal
www.kokuryo.com/goguryeo_history.html Goguryeo Kingdom information portal
http://www.izsak02.com : All pictures
http://wapedia.mobi/en/Administrative_divisions_of_South_Korea Wapedia
http://en.wikipedia.org/wiki/Administrative_divisions_of_South_Korea Wikipedia

Administrative Divisions of the Republic of Korea

COUNTRY PROFILE
Full Name The Republic of Korea
Government Semi-Presidential Republic
President Mr. Lee Myung-bak
Prime minister Mr. Chung Un-chan
Population 48.3 million (UN, 2009)
Capital Seoul
Area 99,313 sq km (38,345 sq miles)
Major language Korean
Major religions Buddhism, Christianity
Life expectancy 76 years (men), 83 years (women)
Monetary unit won
Main exports Electronic products, machinery and transport equipment
GNI per capita US $21,530 (World Bank, 2008)
Internet domain .kr


LIST OF ADMINISTRATIVE DIVISIONS OF THE REPUBLIC OF KOREA
No. NAME HANGUL TYPE CAPITAL
1 Seoul
서울 Special City/ Capital
2 Busan
부산 Metropolitan City
3 Incheon
인천 Metropolitan City
4 Daegu
대구 Metropolitan City
5 Gwangju
광주 Metropolitan City
6 Daejeon
대전 Metropolitan City
7 Ulsan
울산 Metropolitan City
8 Gyeonggi
경기 Province Suwon

9 Gangwon
강원 Province Chuncheon

10 Chungcheongbuk
충청북 Province Cheongju

11 Chungcheongnam
충청남 Province Daejeon

12 Jeollabuk
전라북 Province Jeonju

13 Jeollanam
전라남 Province Muan

14 Gyeongsangbuk
경상북 Province Daegu

15 Gyeongsangnam
경상남 Province Changwon

16 Jeju
제주 Special Self-governing Province Jeju City

Effects Of Privatisation & Liberalization On Banking Sector

Effects Of Privatisation & Liberalization On Banking Sector Performance In Pakistan
A well functioning financial system is necessary for enhancing the efficiency of intermediation, which is achieved by mobilizing domestic savings, channeling them into productive investment by identifying and funding good business opportunities, reducing information, transaction, and monitoring costs and facilitating the diversification of risk. This results in efficient allocation of financial resources. In the financial system banks and non banking financial institutions play vital role. The issue to be considered is whether the financial institution should be owned by the government or by the private sector.
To achieve higher growth, policy makers in many developing countries saw public ownership of banks and other financial institutions as necessary in order to direct credit towards priority sectors. Government of Pakistan nationalized the financial sector in Pakistan in the early 1970s under the framework of the Banks Nationalization Act 1974. The nationalized domestic banks were consolidated into 6 major national commercial banks, and several specialized credit institutions were established.
The objective of the nationalization was to direct bank credit towards specific developing sectors and to provide a source of funding to the government. However, by the end of the 1980s, it became quite clear that the socio-economic objectives, sought through the nationalization of the banking sector, were not being achieved. Instead, the pre-dominance of the public sector in banking and Non-Bank Financial Institutions (NBFIs), coupled with the instruments of direct monetary control, were becoming increasingly responsible for financial inefficiency leading to the crowding out of private sector investment. The dominance of public sector banks at the beginning of the 1990s was apparent with a share of 92.2 percent in total assets of the banking sector. The remainder belonged to foreign banks, as domestic private banks did not exist at that time. Similarly, high shares existed for deposits of the public sector banks. With these characteristics, the banking sector at the end of (Fiscal year) FY90 did not provide a level playing field for competition and growth. The importance of state owned banks in many developing countries contrasts worryingly with recent research findings, which show that state ownership of banks is with negative effects.
The Privatization of government owned banks and other liberalization measures introduced by the Government of Pakistan were the cornerstone of the financial sector reforms initiated in the early nineties in order to revitalize the financial system of the country. As part of this policy, in 1991 two of the publicly owned banks, the Muslim Commercial Bank (MCB) and Allied Bank (ABL) were privatized. At the same time permission was granted for setting up of new banks in the private sector with 10 new banks getting licenses to commence their operations in 1991. End of the 2009 share of public sector banks in the assets of the banking system was reduced to just 41 percent compared to over 92 percent in 1990, while that of private banks had reached over 45 percent starting from nil in 1990. Similarly, the share of public sector banks in the deposit base of the banking system was reduced to 43.5 percent starting from 93 percent in 1990.
Towards the end of 2009, the structure of the banking sector in Pakistan had changed considerably as a result of the privatization/liberalization policies pursued in the broader canvas of financial sector reforms. The resultant efficient service delivery system, customer satisfaction, and the prevention of financial leakages are a clear evidence that privatization is better economic tool than nationalization.

Effects Of Privatisation & Liberalization On Banking Sector Performance In Pakistan

A well functioning financial system is necessary for enhancing the efficiency of intermediation, which is achieved by mobilizing domestic savings, channeling them into productive investment by identifying and funding good business opportunities, reducing information, transaction, and monitoring costs and facilitating the diversification of risk. This results in efficient allocation of financial resources. In the financial system banks and non banking financial institutions play vital role. The issue to be considered is whether the financial institution should be owned by the government or by the private sector.
To achieve higher growth, policy makers in many developing countries saw public ownership of banks and other financial institutions as necessary in order to direct credit towards priority sectors. Government of Pakistan nationalized the financial sector in Pakistan in the early 1970s under the framework of the Banks Nationalization Act 1974. The nationalized domestic banks were consolidated into 6 major national commercial banks, and several specialized credit institutions were established.
The objective of the nationalization was to direct bank credit towards specific developing sectors and to provide a source of funding to the government. However, by the end of the 1980s, it became quite clear that the socio-economic objectives, sought through the nationalization of the banking sector, were not being achieved. Instead, the pre-dominance of the public sector in banking and Non-Bank Financial Institutions (NBFIs), coupled with the instruments of direct monetary control, were becoming increasingly responsible for financial inefficiency leading to the crowding out of private sector investment. The dominance of public sector banks at the beginning of the 1990s was apparent with a share of 92.2 percent in total assets of the banking sector. The remainder belonged to foreign banks, as domestic private banks did not exist at that time. Similarly, high shares existed for deposits of the public sector banks. With these characteristics, the banking sector at the end of (Fiscal year) FY90 did not provide a level playing field for competition and growth. The importance of state owned banks in many developing countries contrasts worryingly with recent research findings, which show that state ownership of banks is with negative effects.
The Privatization of government owned banks and other liberalization measures introduced by the Government of Pakistan were the cornerstone of the financial sector reforms initiated in the early nineties in order to revitalize the financial system of the country. As part of this policy, in 1991 two of the publicly owned banks, the Muslim Commercial Bank (MCB) and Allied Bank (ABL) were privatized. At the same time permission was granted for setting up of new banks in the private sector with 10 new banks getting licenses to commence their operations in 1991. End of the 2009 share of public sector banks in the assets of the banking system was reduced to just 41 percent compared to over 92 percent in 1990, while that of private banks had reached over 45 percent starting from nil in 1990. Similarly, the share of public sector banks in the deposit base of the banking system was reduced to 43.5 percent starting from 93 percent in 1990.
Towards the end of 2009, the structure of the banking sector in Pakistan had changed considerably as a result of the privatization/liberalization policies pursued in the broader canvas of financial sector reforms. The resultant efficient service delivery system, customer satisfaction, and the prevention of financial leakages are a clear evidence that privatization is better economic tool than nationalization.

Bailout is a Good Act of US Govt

The financial crisis which hit the American banks in the fall of 2008, and then spread to the financial markets all across the globe, is the worst crisis since the Great Depression which hit the Wall Street in 1929.Many time honored economic theories proved wrong and there was a stir among the economists and the statesmen alike as to how this could be explained. While this discussion was continuing, American government came up with a bailout package in an attempt to contain the crisis. This policy ignited another controversy regarding necessity of such package. In my view there are numerous reasons for the governments to take affirmative actions such as bailouts to prevent the economy from a complete collapse, and I support the measures initiated by the U.S. government without an iota of doubt in my mind. However, before analyzing it further, it will be better to define the key terms.
What is financial crisis? Financial institutions or assets suddenly lose a large part of their value. Many financial crises were linked with banking panics, and many recessions coincided with these panics. Include stock market crashes and the bursting of other financial bubbles, currency crisis, and sovereign defaults. Financial crises directly result in a loss of paper wealth; they do not directly result in changes in the real economy, but may indirectly do so, notably if a recession or depression follows. Bailout in economics and finance is a term used to describe a situation where a bankrupt or nearly bankrupt entity, such as a corporation or a bank, is given a fresh injection of liquidity, in order to meet its short term obligations. Often bailouts are by governments, or by consortia of investors who demand control over the entity as the price for injecting funds.
The current global financial crisis was triggered by the credit crisis with the USA as its epicenter and then quickly spread across the globe. The crisis started spreading around the world in the middle of 2007 and all along the 2008, whence stock markets in major economies fell, followed by the collapses of large companies and leading financial institutions. In a world where economies are integrated, the spread of such crisis was unavoidable. Now question arises as to whether Government should have bailed out in order to accelerate the rehabilitation of the financial system or not?
A stable financial system is necessary for enhancing the efficiency of intermediation, which is achieved by mobilizing domestic savings, channeling them into productive investment by identifying and funding good business opportunities, reducing cost of information, transaction, and monitoring. This results in efficient allocation of financial resources. In the financial system, banks and non-banking financial institutions play vital role for development of economy. Numerous sectors and industries are associated directly and indirectly with the financial system, and depend upon it. If financial system is stable and functioning properly, it is an indication of economic development and growth. Financial institutions and other sectors is a source of revenue for government in the shape of taxes. The US Government was therefore justified in taking reasonable measures for stability of failing financial system. US strong financial system proved helpful for achieving global financial stability, investor well-beings, job securities, and credit freeze. Recession, if not been controlled, would have resulted in loss of nearly 20 million jobs in America alone, as per predictions made by ILO, and would have brought worldwide unemployment to 200 million for the first time in history (Reuters, 2008)
Critics of the bailout package argue that to make all the citizens of the United States should suffer the loss is literally nonsense. The one who must suffer the loss should be the one who made the bad loans. Anything else is an organized theft. If the bank did not inquire as to whether the borrower could repay the loan, or if it did not require an adequate equity cushion, then it must be responsible for such “stupid loans”. The same goes for those who bought those loans and thereby became the lender. The result of enough such loans should be insolvency. But the economics and businesses are not run by sentiments. There has to be a strong rationale behind every economic action. Only those actions which are in overall benefit of society are economically sound actions. To allow the banks to go bankrupt would not have been an economically sound action in my opinion. This rationale was explained by President Bush when he stated in a speech address to congress in March 2008 "we would get our money back..When the government sells bonds at 3.5 percent and buy preferred stock at 5 percent for five years (and then ten percent thereafter), the government makes money if firms pay the dividends. The market demands 12 percent, but the government, with a lower cost of borrowing money and a very long time horizon for returns, can demand much less”. (Bush, 2008). True enough. It was supported by President Obama in his State of the Union address delivered to the congress on 27th Jan 2010 when he said “Look, I am not interested in punishing banks; I’m interested in protecting our economy. A strong, healthy financial market makes it possible for businesses to access credit and create new jobs. It channels the savings of families into investments that raise incomes” (Obama, 2010).
Finally, the true rationale behind the bailout can be understood through a simple simile. If a house in a street starts burning, what will be the reaction of owners of other neighboring houses? If they take prompt and timely action and control the fire, it is good for all houses. Otherwise, this fire is dangerous and harmful for all. Similarly if the financial crisis starts and financial system becomes unstable, it is harmful for the whole economy. If financial system becomes unstable, it’s a responsibility of government to take appropriate action for rehabilitation and stability of the system.

Bibliography
1. Dorfman, D. (2008, September 22). For, Against Uncle Sam's Bailout. The Sun, New York .
2. Jones, S. (2008, October). A juddering halt to world trade. The Financial Times .
3. Obama, B. (2010, January). Retrieved from state of the union address: http://stateoftheunionaddress.org/
4. BBC Debate on Bailout. (2010, Febuary), www.bbcnews.com
5. Bush, J.W. (2008, January). Retrieved from Congress address: http://stateoftheunionaddress.org/

WHAT IS THE BEST WAY TO SOLVE THE POVERTY OF GAP BETWEEN POOR AND RICH NATION?

“No One Is Born Poor in the World” he brings two hands and one mind. The reason as why during last 200 years some Countries become rich while other could not due to only people (leaders, management, organization, human resources).

All factors like naturalresources, wealth, good leadership, good management and human resource played prominent role in the development but the most important factor is people (in any shape). I am quoting the few sentences of different authors that isreflectingtheir varied views regarding role of wealth in the development.

"Wealth, when you get right down to it, is not the cause of poverty." (Mitchell B. Pearlstein)
“The belief that all wealth comes from stealing is popular in prisons and at Harvard." –(George Gilder)
Ultimately it is only wealth that can reduce poverty."(Thomas Sowell)
Wealth is based on productivity, and productivity is expandable. In fact, productivity is fabulously expandable." –(P.J. O'Rourke)
The attempt to make heaven on earth invariably produces hell." – (Karl Popper)

Let’s suppose if we equally distribute all wealth among all countries, result will be that after few years the poor nation squanders it and will remain poor.
Poor countries can grow rapidly if their people are sincere, hard worked and governments took a long-run view of their people'sinterest and followed appropriate policies. But what pressures are there to push governmentsspecially unelected, non-legitimate modern dictatorships-to take a public-spirited long-run view? W.W. Rostow recounts a visit by President Kennedy to Indonesia in the early 1960s; Kennedy talked about economic development, and a South Asian development bank to provide capital for Indonesia's economic growth. The Indonesian dictator Sukarno's response? "Mr. President, development takes too long. Give me West Irian [province to annex] instead." Sukarno got West Irian to annex; under Sukarno Indonesia's economy stagnated.
Rich nation should help out to poor nation in leadership, human capital instead of given wealth. “No nation is poor in the world if they have sincere peoples with sharp and rational mind”

What does a good Leader “Do?”

“Leader is a person who rules, guides or inspires others for common goals”.
According to my perception leader perform following task.

 Supporting and encouraging peoples towards a collective goal and Patient and motivational.
 Build trust and confidence and have a clear sense of purpose.
 Give vision of what he wants his environment to become.
 Present high ethical values, communicate well and listen well.
 Develop a good judgment and do not pretend himself as a hero.
 Work Continuously and update himself
 He work Hard and have a motto to serve people, brave thinking and strong mind.

I observed from the read lessonsthat there are two situations for leader indecision making. First one is open end (have time and options) and second is close end (no time and options i.e. YES or NO). Second situation is more critical as compare to first. Rational leaders performdifferent in both situations. According to my perception in open end situation leader should follow the Jerome Murphy concept for decision making and in close end situation follow the Lee Iacocca concept.
In my home country I am working in Privatization Commission, I am sharingexperience which I learn from my home department, there is two situations as under.
First Situation: Dr. Abdul Hafeez Shaikh(PhD in Economics from Boston) has over 20 year experience in policymaking and management including worked with World Bank. In 2004 Dr. Abdul Hafeez was performing duty as Minister for Privatization, Pakistani government want to privatize the PTCL (Pakistan Tele Communication Limited),who have monopoly in the market, but in the same year government made mistake by issuingtwo licenses for new mobile companies without consultation with the Privatization Commission.Minister in chargeconstituted a team for research and placed orderfor privatizationof PTCL at fast trackand due toentry of new mobile companies in the market, the competition will be there and investor will not pay good price.
Second Situation: In bidding process the bidders put the bid price, the highest price did not match the reference price but the Minister accepted the bid without consulting the cabinet members. All the intellectuals of different thoughts criticized the fast and quick decision of Minister. But after few months, new mobile companies captured the market share of about 50% and PTCL customers moved towards mobile phones. PTCL revenue started decline. People,who werecriticizing the decision, now appreciated the decision.

Conclusion: In the first option Dr. Abdul Hafeez adopts the Jerome Murphy method and in second situationadopts the Lee Iacocca concept.

KDI International Students Visits DORASAN Station





3rd Batch visit the HYUNDAI HEAVY INDUSTRIES