AFP, Seoul :
The conviction and jailing of South Korea’s top business tycoon heralds a drive to reform the country’s giant conglomerates and loosen their grip on the economy, analysts said.
When Lee Jae-Yong, de facto head of the world’s biggest smartphone maker Samsung Electronics, was jailed Friday for bribing South Korea’s former president and other offences, the Seoul court condemned “corrupt ties” between business leaders and politicians.
It is far from the the first time these links have been made public. South Korea’s chaebols, or family-run conglomerates, have long enjoyed close, opaque ties to political authorities.
“There is a well-founded concern that Korean corporations have too much financial influence over the political system through favours and friendships,” Robert Kelly, professor of political science at Pusan National University, told AFP.
The chaebols were instrumental in the “Miracle on the Han”-South Korea’s rapid transformation from war-ravaged ruin to Asia’s fourth-largest economy – – during which they received privileges in business and protection from foreign competition.
Several-including LG and Hyundai as well as Samsung-established global reputations while their hundreds of thousands of employees, often effectively hired for life, became the backbone of South Korea’s new middle class.
But as GDP growth has slowed, public frustration with the chaebols has mounted. They are accused of choking off innovation, distorting markets, and engaging in corrupt practices to ensure founding families retain control.
