An hour and a half north of Milano, Italy, is the city of Carpi in the region of Modena. This area is famous for having southern Europe's largest textile manufacturing complex. The 60,000 workers have earned 8.3 billion euro annually on clothes alone. The secret to success is working to make the finest quality designs in the world.

The city has 118,126 individual designs from 408 midsize and small companies. That means each company has more than 200 separate brands. Italy's average unemployment rate is 10.6 percent, but here it is only 2.5 percent.

In the 1980s, this place was on the verge of being shut down because inexpensive clothes were coming from Southeast Asia. However, with high quality design skills, they overcame the hardships with "high added-value, various types, and lower quantity."

Only 10 years ago, Finland was almost a "dead" country with an economic growth rate of negative 6.2 percent and unemployment rate of 17.9 percent. But now it leads the mobile phone market with its GSM mobile phones, and has emerged as a strong small country.

Five hundred kilometers north of Helsinki, the area of Oulutechropolis has become an international research and development base as IT-related companies moved into the district following Nokia. There are research centers for 250 multinational companies in Oulu, including HP and Fujitsu, and the money spent here adds up to 30 percent of the country's total research investment.

Each company contributes to the national economy in this way.

In "Norfard Calle" of northern France, the district gave up mining and succeeded in converting to a future-oriented auto parts industry. Calle's strength came from a technology research center, supported by the government. Francois Walle, a research director, said, "The 250 research centers supported by the government and 20,000 researchers pour out state-of-the-art products." There are currently about 1,850 you-name-it foreign companies, including Toyota, Fila, Coca Cola and Daimler-Chrysler.

Ireland is also a country that was judged by economists to have no foundation in the manufacture field. Ten years ago, its GNP was $10,000. As of last year, it was $30,000.

The secret to success was the heaven-like investment environment. The Irish government cut corporate taxes and attracted international companies. Intel, IBM, Microsoft and 1,234 other foreign companies have production bases in Ireland and are raising sales of 52.7 billion euro. This takes up more than half of Ireland's GDP.

Professor Kim Deuk-gap of the Samsung Economy Research Center said, "If we put together the power of large companies, small companies and research centers, we will be able to equip ourselves with competitiveness."

This means that we cannot maintain our manufacturing competitiveness if our factories are in industrial areas like Banwol and Namdong, while Daedeok only has research and development centers. The former president of the American Chamber of Commerce in Korea, Jeffrey Jones, says that labor and management must put their forces together, above everything.

Business leaders and academic experts made the following responses to the special report:

Experts of various fields have deeply sympathized with the Chosun Ilbo's series on "Dying Industries." Experts have differing opinions on how to prevent the manufacturing industries from crumbling, but they all agree that the $20,000 national income per capita will be impossible with manufacturing industries weakening as they are now.

Kim Ki-hwan, president of the Seoul Finance Forum, pointed out that foreign banks in Korea pay a 39 percent income tax, while they pay only 16 percent in Hong Kong. A professor at Korea University, Park Young-chul, also criticized government officials for constantly shifting their positions on decreasing income taxes or adopting the Dutch labor and management model. "Local companies are all moving abroad because they cannot trust these people and make long-term investments," he said.

Sa Gong-il, chairman of the Institute for Global Economies, warned that international firms will not enter a country where violations of the law are socially tolerated. "As former British Prime Minister Thatcher and U.S. President Reagan did, the South Korean government should summon the courage to apply law and order to the companies and labor unions," he said.

Eric Quenet, president of Atofina Korea, explained that the chief executive officers abroad believe that South Korea is a "strike republic," after reading the Financial Times or New York Times about the extreme strikes of Hyundai Motor Company. "The Korean government's joint promotion with foreign companies could help improve South Korea's image," said Quenet.

John Taylor, president of BAT Korea, said that in 1999 he had to lay off 132 employees due to a company merger. The employees received their retirement grants and six-month consolation fees. The company also provided an employment-assistance program that helped all employees find other jobs. "Everyone left the company satisfied," said Taylor, "If we did not discharge the employees then, our company may have had to withdraw from Korea."

Sogang University Professor Kim Byung-ju said, "The layoff regulations must be lifted immediately so that payrolls can be adjusted before companies fall into a serious crisis." Yonsei University Professor Chung Gap-young also pointed out that companies fear recruiting employees because the layoff are too complicated. "The overprotective labor policy designed to satisfy the few labor unions of conglomerates is actually causing higher unemployment rates," he said. Ahn Chul-soo, president of the Ahn Chul-soo Laboratory, recommended the expansion of the social safety net and increase of labor flexibility.

The president of the Korean Chamber of Commerce, Park Yong-sung, argued that the current Korean wage system was impractical. "The salary difference between a newly recruited employee and an employee that has worked for 30 years is relatively small in the U.S., and that is why employees with more work experience can be protected from layoffs."

Another business owner, Byun Dae-gyu, said, "The president and employees are all colleagues and partners on the same ship. Labor must change its perception so that it helps to make a bigger pie first and then dividing it into pieces."

Samsung Electronics President Lee Yoon-woo stressed the seriousness of the labor shortage, saying, "We are known to recruit most of the best workers, but we are still short about 1,000 workers in the science and engineering fields."

Kim Young-soo, chairman of the Korea Federation of Small and Medium Business, asked companies to stop blaming their work forces and start increasing competitiveness by grafting the IT field to their original businesses.

Experts also suggested that the current labor-related laws should be amended so as to legally make use of foreign workers in this globalization society.

Cho Wang-ha, vice-chairman of Kolong, explained that perspectives from the desks and the workplaces were too dissimilar. "I hope people remember that when the manufacturing industry died in the U.S., former President Reagan saved the economy by granting tax breaks and investment incentives to companies that took over struggling businesses.

Lee Byung-nam, vice president of the Boston Consulting Group, explained that in order to reach a national income of $20,000, exports must increase by at least 13 percent each year: "In the end, conglomerates like Samsung Electronics, Hyundai Motor Company, and LG Electronics must accomplish this task. The policy should change its focus from restricting the economy from concentrating on conglomerates to boosting conglomerates to become global companies."

Jeffrey Jones, former chairman of the American Chamber of Commerce in Korea, said that it is impossible for Korean firms to lower wages. Jones recommended that companies increase their productivity by further developing the more competitive industries, such as the automobile, shipbuilding and semiconductor sectors.

Jeon Sung-chul, chairman of the Institute of Global Management (IGM), said, "Korea might have depended its labor force to make cheaper goods until now, but now it is at a stage that requires the productivity of management."

Moon Kuk-hyun, president of Yuhan-Kimberly, requested that the country increase its productivity by investing in the labor force and running the management more effectively. "Workers should not demand higher wages without developing their skills," added Moon.

Lee Nam-soon, chairman of the Federation of Korean Trade Unions, said that the government should design a social safety net in order to reduce the relative deprivation workers feel when wages are not increased high enough. "The government should also make systematic improvements to support the costs workers pay individually, such as education, medical, and housing fees," he said.