Seoul’s public transportation operators are in serious financial trouble as the number of bus and subway users sharply dropped last year due to the coronavirus outbreak, the Korea Herald reported. The Seoul Metropolitan Government said Wednesday that 1.45 billion passengers used regular city and local “maeul” buses last year, down 23.6 percent from 1.95 billion a year earlier. The number of airport bus users dropped 85.4 percent on-year to 2.12 million passengers.
SsangYong Motor Co. is prepping to file for a pre-packaged bankruptcy in South Korea, a speedier turnaround with the help of creditors, after winding up talks with a new potential investor, Maeil Business News Korea reported. SsangYong Motor CEO Yea Byung-tae said the company would be drawing up a prepackaged prospectus with HAAH Automotive Holdings, a candidate to buy stake from Indian parent Mahindra & Mahindra, according to industry sources on Thursday.
In any normal year, a 1% contraction in South Korea’s economy would be disappointing. In 2020, it is a mark of resilience, as strong exports and success in containing Covid-19 buoyed Asian economies against one of the worst global downturns in modern history, the Wall Street Journal reported. The drop in gross domestic product, reported by the Bank of Korea on Tuesday, is expected to be one of the smallest among major economies, according to estimates from the Organization for Economic Cooperation and Development.
A South Korean court sentenced Samsung Electronics vice chairman Jay Y. Lee to two and a half years in prison on Monday, which could delay the group’s ownership restructuring following the death of Lee’s father in October, Reuters reported. The ruling also cements a major shift in South Korea’s view on wrongdoings committed by the owners of the country’s powerful conglomerates, or chaebol, which led the country’s economic rise after the Korean War on the back of what has been criticised as cozy relations with politicians.
South Korea’s Eastar Jet filed for court receivership this week, a Seoul court said on Friday, as the pandemic-hit budget airline fights for its survival, considering options such as a merger and acquisition among strategies to stay in business, Reuters reported. The airline laid off about 700 of roughly 1,600 employees last April due to the coronavirus fallout and has struggled to find a strategic investor since July, when No.1 budget carrier Jeju Air Co Ltd scrapped a plan to acquire it.
South Korea’s central bank meets this week with Governor Lee Ju-yeol flagging the fragility of an economic recovery threatened by the resurgence of the virus, Bloomberg News reported. With the country facing a possible slowdown in demand at home and abroad, the Bank of Korea is expected to maintain its support for the economy on Friday by keeping interest rates at a record low and showing a readiness to help stabilize markets if necessary.
Think of major threats to South Korea, and its nuclear-armed neighbor North Korea may come to mind. But a subtler risk to South Korea’s future well-being lies within its borders: a shrinking and rapidly aging population, the New York Times reported. The concern was underscored this weekend with the release of census data that showed South Korea’s population fell in 2020 for the first time on record. A declining number of newborns was exceeded by a growing number of deaths, according to census data reported Sunday by Yonhap, the South Korean news agency.
South Korean carmaker Ssangyong Motor has filed for bankruptcy after failing to repay creditors, a move analysts said signals that the government is unlikely to bail out pandemic-hit companies that have foreign backers, the Financial Times reported. Ssangyong, 75 per cent-owned by Indian automaker Mahindra & Mahindra, has filed for court receivership and warned of massive disruptions to its operations after defaulting on loan payments of about Won60bn ($54.4m).
Automaker Mahindra & Mahindra’s South Korean unit Ssangyong Motor Co has defaulted on loan repayment of about 60 billion won ($55 million), the Indian company said in a statement to the stock exchange on Tuesday, Reuters reported. Of the total payment that was due on Dec. 14, about 30 billion won was owed to Bank of America, 20 billion won to JP Morgan Chase and 10 billion won to BNP Paribas, Mahindra said. Shares of the Indian automaker fell as much as 1.5% on Tuesday to their lowest since Nov. 23, while those of Ssangyong fell up to 7.72%.