South Korea

The plight of South Korea’s 6m contract workers and the polarisation of the 18m-strong workforce goes to the heart of the country’s reform challenge, the Financial Times reported. President Park Geun-hye has put the labour market at the core of structural reforms aimed at reviving economic growth. South Korea’s economy grew just 0.4 per cent in the last three months of last year from the previous quarter — the slowest pace for two years. “Our economy is at a crossroads,” she said recently in a meeting with business leaders.

South Korea’s government is fighting to address the dangers of the nation’s fast-rising household debt burden — even as critics accuse it of stoking the credit boom through deregulation aimed at boosting the housing market, the Financial Times reported. Economists have raised fears over the country’s heavy household debt, which has risen steadily since the late 1990s to more than 160 per cent of disposable incomes at the end of last year — one of the highest levels of any developed nation.

South Korean bulker operator Daebo International Shipping has filed for bankruptcy protection in the Southern District of New York, TradeWinds News reported. The Chapter 15 petition follows an application to commence rehabilitation proceedings in the Seoul Central District Court, which was submitted on 11 February 2015. Since then, at least five creditors have filed lawsuits against Daebo and its affiliates in the US, which is why observers say they aren't surprised by today’s revelation.

A third dry cargo shipper has filed for bankruptcy this month following a collapse in freight rates to historic lows in what shippers call the worst market conditions since the 1980s, Commodities Now reported. South Korea's Daebo International Shipping Co Ltd filed a court receivership, a form of corporate bankruptcy, on Feb. 11, mainly due to poor dry bulk market conditions, a company official said on Monday. It is the third known bulk shipper bankruptcy this month.

A local court said Wednesday it has decided to commence a receivership program for midsize South Korean builder Dongbu Corp., which has recently been hit by financial troubles amid a slump in the construction industry, the Yonhap News Agency reported. The decision by the Seoul Central District Court came just a week after the construction arm of the country's 18th-largest conglomerate Dongbu Group filed for the receivership program after admitting it was unable to repay the 261.8 billion won (US$238 million) it had borrowed from local banks.

More South Korean households are piling on debt at the fastest rate in a decade as the government is using credit to stimulate sluggish consumption, the Financial Times reported. Choi Kyung-hwan, who took office as finance minister in July, has launched a $40bn stimulus package, warning of Japan-style stagnation taking hold in Asia’s fourth-largest economy.

Zalman Tech, a legendary maker of cooling solutions and other devices, has filed for bankruptcy. The company had to file for insolvency protection in South Korea because its parent company Moneual took loans it could not eventually repay by using fabricated export data. The destiny of Zalman is unclear. Zalman was established in 1999 and initially focused purely on coolers for microprocessors and graphics cards.

CSA Czech Airlines said that its key shareholder Korean Air Lines Ltd. has agreed to inject fresh capital into the country’s flagship carrier as it seeks to overcome its current financial struggles, The Wall Street Journal Emerging Europe blog reported. “The offered sum is within expectations of CSA laid out in the company’s restructuring plan,” CSA Czech Airlines’ spokesman Daniel Sabik told the Wall Street Journal Thursday, referring to the required maximum financing needs that in September were estimated at about $20 million.

Korea's leading robot vacuum cleaner manufacturer Moneual has filed for court receivership after failing to pay bonds worth 500 billion won ($474.1 million) that matured last week, The Korea Times reported. The Suwon District Court will soon decide whether to approve its request. Major creditors include the National Agricultural Cooperative Federation, the Korea Development Bank and the Industrial Bank of Korea.

South Korea's No. 3 smartphone maker, Pantech Co., which has been under court receivership, is now up for sale on Wednesday, in a desperate move to get the company back on its feet, the Yonhap News Agency reported. The latest development came as the Seoul Central District Court gave its nod to a plan by Pantech creditors led by the Korea Development Bank to sell the company, a month after it commenced the troubled firm's court receivership program. Sale manager Samgjong KPMG will accept bids from potential buyers until 3 p.m. on Oct. 7.