November 21, 2013 11:51
The nation's top 30 conglomerates plan to invest more money next year. While some conglomerates like STX and Tongyang are experiencing financial problems and downsizing, most expect the global economy to rebound next year.
The Chosun Ilbo questioned their chief executive officers and chief financial officers on Wednesday and found that 15 plan to focus on new investments next year. Only eight of the conglomerates said they will stockpile cash instead and wait for further signs of a recovery, while six said they would first repay their debts.
In the same survey last year, almost 60 percent of the business groups said they would first repay their debts or stockpile cash to prepare for emergencies. Only 40 percent said they would bolster investments.
For several years now, major conglomerates have postponed new investments and stockpiled cash citing external risks. This has led to growing concerns that Korea's weakened economic vitality.
CEO Score, which evaluates the performance of major business groups, said the 82 subsidiaries of the country's top 10 conglomerates had stockpiled W477 trillion (US$1=W1,058) as of the first half of this year, up a whopping 43.9 percent from the same period of three years ago.
In the latest survey, only 13.3 percent of the conglomerates said they plan to cut down on investments next year, whereas 30 percent of the business groups hope to boost investments next year, with two saying they plan to increase investment by more than 30 percent.
Half of the conglomerates said they will maintain investment at this year's level.
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