Chaebol prosper under MB
The average revenue growth at Korea’s top 10 conglomerates, including Samsung and Hyundai Motor, under the Lee Myung-bak presidency was about four times more than during the term of Lee’s predecessor, Roh Moo-hyun, data showed yesterday.
Since Lee’s inauguration in February 2008, the family-owned business groups, also known as chaebol, averaged 13 percent annual growth in revenue, compared with 3.1 percent under Roh, according to an analysis of financial statements and the Korea Fair Trade Commission filings.
Excluding 2009, when the Korea was hit hard by the global financial crisis, chaebol revenue jumped 15 to19 percent annually. The data also showed that chaebol accounted for a larger share of gross domestic product. Their combined revenue represented 52.6 percent of Korea’s GDP from 2003-2007 and 69.1 percent from 2008-11.
The 10 chaebol also expanded in terms of size under Lee. The number of their affiliates jumped 53.3 percent to 581, while they grew 21.5 percent to 379 units during Roh’s presidency.
The data, however, showed the net profit of the 10 conglomerates fared better under Roh, 13.1 percent annually from 2003-07 and 8.5 percent annually in 2008-11. In 2004, Samsung posted a record net profit, sending the combined net profit of the top 10 chaebol soaring 52.9 percent higher from the previous year.
The top conglomerates’ combined net profit was 6.5 percent of total revenue under Roh, but slipped 1.1 percentage points to 5.4 percent under Lee. Korea’s top 10 chaebol include SK, LG, GS, Lotte, Hanwha, Hyundai Heavy Industries and Hanjin.