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  • Archive for October, 2012

    South Korea’s post-KORUS (Korea-US FTA) legal market – 6 Factors

    October 31st, 2012  by  Asia-Pacific Global Research Group - Jasper Kim

    1. The Korea-U.S. free trade agreement went into effect in March this year. As a result, you say that American and Korean law firms will be able to jointly launch ventures, invigorating the traditionally isolated Korean legal market. You wrote about this in May — reflecting on this half a year later, what fruits have you seen so far?
    There’s always pros and cons to change. The pros are that a wider variety of law firms and lawyers will, over time, steadily increase here in South Korea (a country that has had zero onshore presence in terms of foreign law firms until this year). The cons exist with existing domestic law firms, small to large, that now faces greater competition. But arguably, increased competition should–in theory and hopefully practice–lead to increased quality and lower prices (i.e., more value for money).
    2. You have said that Korea doesn’t have enough lawyers in a fairly recent WSJ op-ed (Cracking Open Hermit Kingdom, LLP–by Jasper Kim). Compared to the U.S., which has one lawyer for every 268 people and England that has one lawyer per 513 people, South Korea has one lawyer for every 1,264 people–correct? Does this really speak to a true shortage of legal workers in Korea? Could it point, instead, to a shortage of demand for legal services in an arguably less litigious culture than those of the West?
    South Korea, according to Harvard’s Program on the Legal Profession, actually has one one lawyer for every 5, 178 people (dividing South Korea’s population of 48.8 million by 9,400–the approximate number of licensed Korean attorneys, known as byeonhosa). In comparison, Japan has one lawyer for every 4,188 people, which is a high number for Japan since it has also undergone a recent graduate law school system reformation, similar to South Korea beginning in 2008. So South Korea has one of the lowest, if not the lowest, ratio of lawyers to its general population among industrialized economies. The same thinking was also thought of Japan, that Asians like to avoid conflict, including litigation. But this has not proved true in Japan, nor will it in South Korea. As one example, take a look at the ongoing Apple v. Samsung series of global lawsuits. One could argue that this is because a non-Korean party is involved. But this is an economic reality for contemporary South Korea, in which 48% of its domestic economy is based on non-Korean entities and consumers dealing with Korean products overseas. Even domestically, the sheer number of litigation cases has increased dramatically, especially in recent years.
    3. You’ve also written about the Americanization of legal education in South Korea (as well as Japan), with the introduction of professional graduate law degrees. How do you reconcile what you’ve claimed about the lawyer shortage in Korea with recent reports that many of these new graduates of law schools can’t find well-paying jobs?
    The employment numbers earlier this year, just after the new law schools’ first class of graduates were not great. But according to recent surveys six months after graduation, the job placement rate of new law school graduates have surpassed 80 percent. This, in my view, is fairly extraordinary given that the number of Korean lawyers has doubled just this year (due to the added new law school graduates), in addition to having to find employment within a global post-subprime crisis economic slowdown period, domestically and internationally. The number is also on average higher than the law school graduate employment rates in the U.S. This is a sign that demand does exist for Korean lawyers, both under the new graduate system as well as the traditional bar exam system (the traditional bar exam does not require an academic degree to sit for the exam, while under the new law school system, a person must first graduate from one of Korea’s 25 graduate law schools to sit for the new bar exam).
    4. Do you think the new generation of Korean-educated lawyers are equipped to deal with the increasingly globalizing legal market here in Korea? Or will the market respond by bringing in more foreign-educated lawyers?
    The two are complementary to one another, although some (but not all) local media outlets have portrayed it as something less benevolent. With the new Korean lawyers, employers should get two skill sets in one–that is, an undergraduate degree say in economics and/or engineering, along with a graduate law degree. So, for instance, with the ongoing Apple v. Samsung suit, a new Korean lawyer with such academic skill sets, could be able to navigate through the relevant technical patent issues as well as the legal issues, instead of having to pay for and manage two separate personnel for the same analytical capabilities. This will help, not hurt, the Korean economy.
    5. A lot of foreign firms looking to do business with, or even merge with Asian firms are looking to take a piece of the China pie… What kind of positioning does Korea have for attracting foreign legal firms?
    South Korea can leverage its unique “hybrid” legal system as a model for other systems. South Korea on paper is a civil law country patterned after Japan, which in turn, was patterned after Germany during Japan’s Meiji Restoration period from 1868. But the hybrid element comes in the form of South Korea’s post-Korean War, and particularly, post-1997/98 Korean financial crisis experience dealing with often cutting-edge commercial law issues, including US legal issues relating to bankruptcy, restructuring, and M&A.
    6. Do you think growth of Korea’s domestic legal market will be symbiotic with the growing prominence of Korean companies abroad?
    Yes, the two are symbiotic. But the greater issue is how Korean firms leverage their legal talent. Right now, lawyers are just lawyers–they are expected to wear just one hat–a legal hat. But as mentioned earlier, this may not be the best way to maximize value for the company’s and even country’s legal talent for the twenty-first century.

    Kim Han-sol Youtube/TV interview (grandson of DPRK’s Kim Jong-il) – Breakup or Breakout Event?

    October 24th, 2012  by  Asia-Pacific Global Research Group - Jasper Kim

    1) For our listeners who haven’t got a chance to watch the recent interview, what do we know about this teenage member of North Korea’s dictatorial clan?

    We know very little. But what we do know is that Kim Han-sol (김한솔) is a 17-year old student, attending United World College (UWC, a British-based educational foundation), who spent most of his young life outside of North Korea, primarily in Macau for much of his primary years, and now in Serbia-Herzegovina to attend UWC.
    2) He seems to be surprisingly comfortable talking about North Korea and his family. What are some striking features about him in both appearance and speech ? And how is he so much at ease to discuss about his background or Pyongyang (평양)?
    We know, based on his recent interview on Finnish TV, among other sources, that he looks like any other normal person his age. He spoke fluent English during his recent interview, and during the interview, appeared relatively media savvy. He seemed exceptionally poised, perhaps arguably overly poised, for a young adult his age in which it was meant to be believed that he was speaking “off the cuff.” But we at the Asia-Pacific Global Research Group believe that this interview–which is basically a coming out event for Kim Han-sol (김한솔)–is not off the cuff, but rather, the finished product of a much-prepared and highly calibrated event. An event like this, even outside of the DPRK, would normally not occur without prior knowledge and maybe even approval from the highest levels in the DPRK. Interestingly, Kim Han-sol’s visual appearance also varies. In his recent Finnish TV interview, he appears like a stately young gentleman. In contrast, in social media, such as seen in his Facebook account, we see pictures of him with bright blond hair and earrings.
    3) What does his enrollment at an institution like UWC imply considering North Korea often clashes with UN values of philanthropy and its humanitarian efforts?
    We at the Asia-Pacific Global Research Group believe that attending the UWC, rather than say another school inside or outside the DPRK, may have been a strategic decision by his father (Kim Jung-nam, 김정남) to make his son, and thus himself and the DPRK, appear more approachable and reasonable to the eyes of the international community. Consider that the stated UWC mission is to “makes education a force to unite people, nations and cultures for peace and a sustainable future,” which would make Kim Han-sol, and the DPRK, appear almost like a reasonable state. This could help in swaying the international community and the court of world opinion. The interview may also have served as a “coming out” event for Kim Han-sol as a possible future offshore informal spokesperson for the DPRK–a country viewed as a constant enigma, and impossible to decipher due to its tightly closed nature.
    4) Do you think the interview with Kim Han-sol (김한솔) that was open to global viewership, represents a crack in the North Korean leadership or possibly Kim Jong-nam’s (eldest son to the late Kim Jong-il) (김정남) efforts to grab international attention for whatever personal reason?
    If it’s a crack, we believe it was a coordinated crack in communication. From the eyes of the DPRK leadership, another “international” DPRK figure–who much like Kim Jung-un (김정은), is young, raised overseas, and bi-/multi-lingual–may provide another PR avenue opportunity for the DPRK leadership to appear more civil and reasonable–which may or may not be the case–in an era where media and global communication is becoming increasingly pivotal. Viewed externally beyond the DPRK leadership and its borders, Kim Han-sol’s relatively normal, well-dressed, composed, and fairly articulate interview may serve as a sort of “alter ego” to Kim Jung-un to sway some in the international community to view the DPRK and its leadership in a more favorable and approachable light.
    5) In light of the December presidential race here in Korea and the US presidential election soon to come, how do you think this will impact some of the candidate’s diplomatic policy towards North Korea or regarding efforts to push for Korean unification?
    In short, the interview will have a nominal impact, on the US presidential elections since both Obama and Romney have declared their positions on North Korea (which are surprisingly similar). But in the South Korean presidential elections, the multiple references to peace and a unified Korean peninsula during Kim Han-sol’s relatively short recent interview has made media headlines here in South Korea, which may have some political sway among the watching general electorate. The interview may also be a purposeful strategy to further boost the liberal candidates’ chances of being elected into the Blue House. Having either Ahn or Moon in the Blue House, rather than Park Geun-hye, would be the strong presidential preference by the DPRK. This is because, inter alia, either Ahn or Moon as the Korean president may very well translate into more economic and non-economic aid to the North, and perhaps an attempt towards a Sunshine Policy 2.0.
    6) How will North Korea go about dealing with censoring or blocking itself from so-called foreign influence when its becoming harder to control information flow?
    This is a complex topic in and of itself. In short, we believe that it is an issue of “when” not “if” in terms of when the “Great Communication Wall” of the DPRK will crack and then suddenly and unexpectedly break the dam that is the DPRK leadership’s stronghold. This was the case with the USSR, a larger Stalinist state than the DPRK earlier, a state which the DPRK patterned itself politically, in part. And this was also the case when the Berlin Wall, cracked and collapsed, to suddenly and unexpectedly unify East and West Germany.* (In Germany’s case, East Germany’s GDP was about 30-40 percent of West Germany’s–unlike in the Korean Peninsula, in which North Korea’s GDP is roughly 5 percent or less that of South Korea’s GDP).
    The Youtube clip of Kim Han-sol’s interview on Finnish TV (in English) is below:
    Kim Han-sol Interview – Part 1 (from 2:00 minute mark onwards):

    Kim Han-sol Interview – Part 2


    South Korea Seeks to Win U.N. Security Council Seat – 6 Important Issues

    October 15th, 2012  by  Asia-Pacific Global Research Group - Jasper Kim

    UPDATE: October 17, 2012 – South Korean delegation wins its bid for a non-permanent UN Security Council seat.
    South Korea is vying to secure a non-permanent seat on the U.N. Security Council this week, but it won’t be able to let its guard down in the face of competition from two other Asian nations, officials said Sunday.
    1) Can you give us some background on when and what nation’s are vying to join the exclusive international security group?

    The UN Security Council (UNSC) is the only UN organ that has the authority to recommend the use of sanctions and/or force, among other things. More specifically, the UNSC is represented by five veto-wielding permanent members — Britain, China, France, Russia and the United States — and 10 non-permanent members. The 10 non-permanent member states are elected to serve two-year terms. The United Nations is scheduled to vote on the bid on Thursday (local time / October 18, 2012), with Cambodia and Bhutan also competing for the single seat assigned to the Asian region. South Korean diplomats, including Foreign Minister Kim Sung-hwan, have stepped up efforts in recent months to win the support of U.N. member states in its bid to return to the council in 2013-2014. South Korea previously held a non-permanent seat in the UN Security Council from 1996-1997.
    2) What is the purpose of Seoul trying to return to the UN Security Council?

    The Seoul government has also said securing a UNSC seat would help it reduce tensions on the Korean Peninsula. “The U.N. Security Council is where the important issues of the world are discussed,” foreign ministry spokesman Cho Tae-young said in a recent press briefing. “As a middle power with a top 10 economy, we would do our best to play our part in promoting international peace and security, and developing the international community.”
    3) What are some of the nation’s main challenge in seeking an opportunity to secure their seat in the UNSC?

    Seoul officials have stated it believes it may be close to securing the required number of votes — 129, or two-thirds of the U.N.’s 193 member nations — but continue to face competition from Cambodia and Bhutan, two states that are likely to win the support of other Southeast Asian nations and/or developing countries. Procedurally, if no country –- South Korea, Cambodia, or Bhutan — wins two-thirds of the vote, U.N. regulations require all member states to take part in additional rounds until the final winner emerges. “It would be best to win in the first round, but that might not be easy,” said a government official, who spoke on condition of anonymity. “In that case, we would hope to have a big lead over the runner-up so as to beat them in the second round.”
    4) What are some benefits that come with taking a seat at the UNSC? How will it help elevate Korea’s national image, economy, and security? And what are the responsibilities that come with taking a seat at the UNSC?

    A UNSC seat — even a non-permanent member UNSC seat — would give any country added diplomatic sway and influence. This is because the UNSC members can utilize Chapter VII of the UN Charter, which allows for sanctions and/or the use of force in certain conditions. For instance, Article 51 of the UN Charter under Chapter VII (collective self defence provision) – under one interpretation – allows for pre-emptive strikes against those states that may be preparing to launch an offensive strike against a target state.
    5) Do you think that joining the security council will help ease tensions in the Northeast Asia region where touchy territorial and historical issues have always been at the center of most of its disputes – in the past and as of late?

    Yes and no. Yes, since Northeast Asia has been particularly volatile not just recently with the disputed islands among South Korea, China, and Japan, but also dating back for over a century. So having an additional member from Northeast Asia will allow for more equal representation in this very important region. No, in the sense that if South Korea is allowed to join the UNSC, North Korea may also feel slighted, which in turn, may lead to more provocative acts by the DPRK. Recall that due to such need to seek equal representation by both Koreas, the UN gave both the ROK and DPRK simultaneous entry as UN member states in the same year, 1991, which was both purposeful and strategic.
    6) What are the chances of Seoul joining the UN Security Council compared to the two other Southeast Asian countries?

    It’s anybody’s guess. On the one hand, South Korea is a model economic success story that exists between two very large neighbors, China and Japan. South Korea is also trying to create peaceful relations on the Korean peninsula, which is at times, not an easy accomplishment. On the other hand, there may be concern that South Korea is, in a sense, over-represented in the UN, since the UN Secretary-General, Ban Ki-moon, is also from South Korea. It took Colombia and Cuba 154 rounds in 1979 and 47 rounds for Venezuela and Guatemala. Plus South Korea already was represented in the UNSC from 1996-97.


    Google Big Tent Seoul: Enabling the Next Wave of Innovation – 5 Takeaway Lessons

    October 10th, 2012  by  Asia-Pacific Global Research Group - Jasper Kim

    The following 5 takeaway lessons are from the recent Google Big Tent Seoul event. Jasper Kim of Asia-Pacific Global Research Group was a panelist for this conference relating to the issues below:
    1: Why isn’t the Korean education system turning out the next Mark Zuckerberg – or is it?
    First, Korea should and can create its own homegrown version Mark Zuckerberg – as seen, for example, with Jack Ma of Alibaba in mainland China. Second, Koreans are highly entrepreneurial – the rise of small businesses/shops in Seoul are testament of this – but it’s arguable whether Korea’s current ecosystem promotes entrepreneurs and entrepreneurship for the 21st century.
    2: Having taught university students in Korea, US and Japan, do you see any difference vs. students in other countries?
    US: The US is of course a highly individualistic society – thus students have more “freedom to fail” since the US culture is based on new frontierism and risk-taking. If you think about it, American’s first immigrants were inherent risk takers. Because it has a shorter history, it is not as burdened by centuries of historical precedent.
    KOREA: Korea’s students live in a so-called collectivist society. So students have to worry not only about their own career, but how their career choice will impact or influence their family (and family’s reputation), and further up, how their career choice will be perceived among a relatively conservative society. Of course, this is true in other societies, but not to the degree seen in contemporary South Korea.
    3: We’ve heard about what other countries do to nurture innovation. How can we bring this system and mindset be brought to Korea?
    Silicon Valley in California is the most oft-cited case of nurturing innovation – but it is one of many benchmarks.
    In Silicon Valley’s case, innovation and risk taking was spurred in part through deregulation, not further government intervention. This can in the form of, among other things, certain tax exemptions and greater flexibility of how certain firm types could invest when it came to venture capital investments.
    Another interesting benchmark exists with Germany’s “fraunhofer” innovation hubs that began several decades ago. Today’s there’s dozens of such hubs within Germany. Unlike in Korea’s case – where government funding is prevalent in orchestrating various state-sponsored innovation hubs, industrial parks, and incubators – Germany’s fraunhofer system involves a structure funded approximately 70% by industry (private sector) and 30% by the state in the form of state grants (similar somewhat to funding in the US through its National Research Center and DARPA).
    4: How can Korea get away from its seeming “teaching to the test” structure/mentality.
    Teaching to the test is unfortunately an inherent part of today’s Korean education system, especially at the K-12 level. This is in part driven by the need to provide “the [one and only one assumed correct] answer” to students relating to the Korean college entrance examination (called “seuneung shihum”). The country essentially revolves around this one test, taken at age 17 or so in high school, which in large part determines the future of a young child until retirement. If the child scores a “home run” on this important day in the form of a high test score, she/he is marked for success. Anything short of a “home run” test score will essentially banish the student to a second-tier school, which in Korea, is almost tantamount to an academic scarlet letter, which in most cases lead to much less enticing financial and even social prospects in the future. On this “mother of all test days,” the country essentially comes to a grinding halt – public employees are asked to start work later, subways come more often, and aircraft are prohibited from flying near or over designated test centers.
    This links to a system that promotes teaching to the test, whereby primary school educators essentially outsource some of their teaching duties to outside private education institutes (known as “hagwon”). So for this reason, various shared and entrenched interests exist that make change in education to promote innovation a challenge.
    “Success” should be broadened to mean more than getting into a narrow band of universities and companies. A more innovative society can be fostered by pushing for a culture that a
    5: How do American, EU and other schools nurture creativity, how is that systematized, how do you build that into a curriculum?
    Korea can create what we refer to as a “Confucian creativity cluster” by creating value-added, proactive linkages between research universities, industry, funding institutions (VC funds), and the government. In particular, the private sector has a shared interest in providing funding and even part-time instructors to donate their time in the form of setting up programs, providing equipment, and to teach high school students, especially related to high tech innovation, which is highly value-added. After all, the private sector is most in tune with the skill sets needed for the twenty-first century workforce. Of course, this has to complement, not pre-empt, teaching and other programs by the school itself. As an example of this, Microsoft works with local high schools in the Seattle region to provide equipment and teach related courses to spur the next generation Bill Gates, et al.
    View the Google Big Tent event’s “Education and Innovation” panel below (including Jasper Kim of Asia-Pacific Global Research Group):

    U.S.-ROK missile pact revision – 5 Implications

    October 3rd, 2012  by  Asia-Pacific Global Research Group - Jasper Kim

    1) What has been revised in the joint military pact between Korea and
    the U.S.? (in terms of the country’s missile capabilities?)

    The recent missile range pact between the U.S. and ROK allows for the extension of South Korea’s ballistic missile range from the current striking distance of 300km to 800 kilometers.
    What this means is that – with a strike range of 800 kilometers – South Korea’s missiles would have the capability to strike most, if not all, targets within North Korea, including its Yongbyon nuclear facility.
    North Korea’s ballistic missiles have the potential to strike most, if not all, targets within South Korea. The DPRK is also developing its Taepodong-2 ballistic missile technology, which some estimate to have a strike range of up to 10,000 kilometers. This range would make a strike target as far away as Hawaii possible.

    2) Why has Seoul strongly called for the revision?
    South Korea has wanted the ballistic missile pact revision to broaden its missile protection capabilities. Other related reasons could include:
    – Recent North Korean aggressions in and around the DPRK-ROK border, including attacks/aggressions against Yeonpyeong Island in 2010 and an earlier attack on a South Korean warship, the Cheonan, which killed 46 servicemen
    – Increasing inter-Korean political uncertainty regarding Kim Jong-Un, North Korea’s recently appointed leader. Little is known about him. And given his relative lack of military experience and youth (late 20s), the likelihood of potential internal insurrection may be seen as uncertain and thus riskier. Based in part on such uncertainty, the ROK’s defense ministry has called for a 5.1% military budget increase
    – From a domestic political perspective, a push for greater missile capabilities before South Korea’s upcoming December 19 presidential elections may be a strategic pre-emptive move to mitigate the risk that South Korea’s next president may not be from the same conservative ruling party (Saenuri). Of the three top presidential candidates, two of the three (Moon Jae-in of the DUP party, and Ahn Chul-soo an independent candidate) would most likely support a relatively more dovish/pro-DPRK policy stance.
    3) Washington has been reluctant to alter the pact for a significant
    period of time. Could the revised agreement undermine Japan and the U.S.’s initiatives of non-proliferation and arms control?

    First, from the U.S. perspective, on the one hand, it is in the process of increasing its security pivot more towards Asia, which serves as a notable security presence to Pyongyang and Beijing.
    Second, yes, the revised agreement could undermine Japan and the U.S.’s initiatives towards non-proliferation and arms control in the region (which has been especially tumultuous recently, due to increased tensions based on disputed island territories involving China, South Korea, and Japan).
    What the U.S. wants to avoid is an Asian arms race – what can be called a twenty-first century “Confucian Cold War” in which Japan decides to reconstitute its nuclear technology for military use. This would mean that Tokyo’s leadership would put forth the process towards amending its post-War constitution, which at present, provides for its military to be used for defensive purposes only, or alternatively, taking a relatively broad interpretation of “defensive purposes” to include, but not be limited to, such things as protecting its national interests abroad (rather than purely domestically).
    It is important to not understate the potential for Japan to convert its nuclear capabilities for military use in a relatively short time period, if provoked to do so.

    4) Briefly tell us about North Korea’s missile capabilities and how
    strong of a threat it is to the security of the Northeast Asian region
    as well as the Korean peninsula.

    – BALLISTIC MISSILES: 800 (estimated total)
    – POTENTIAL LONG-RANGE MISSILE CAPABILITIES: TAEPO-DONG 2 (which can conceivably reach targets as far as 10,000 kilometers from the missile’s launch pad)
    – NUCLEAR WARHEADS: 6 to 8 (as publicly announced by the DPRK). Speculation exists that the DPRK has the capability to produce more nuclear warheads, which it may be doing at present.
     – ARMY: 1,000,000-plus (estimated). Although the sheer size of the DPRK’s military is noteworthy, it is highly possible that most of its army are not as well-equipped as ROK and U.S. military forces that it will meet in the event of a conflict.
     5) What is North Korea’s likely reaction to the revision?
    One of North Korea’s greatest weapons is an invisible one – being predictably unpredictable and unpredictably irrational.
    Although no one really can know with great specificity, given that the DPRK is a black box of sorts in terms of available information, what can be said is that it is more a question of “when” than “if” North Korea will antagonize South Korea and its allies. Such behavior may come in the form of military and/or paramilitary and/or cyberattacks, particularly before, during, and possibly after South Korea’s upcoming presidential elections.
    See the Global Times op-ed piece here by Jasper Kim on this topic.