Interview: Mr. Kim Sung-Hwan, Senior Secretary to the President for Foreign Affairs & National Security

The inauguration of Mr. Lee Myung-bak as President in February 2008 represented a significant shift in South Korea's foreign policy. Since then, the government has pursued a “pragmatic” foreign policy based on strengthening relationships with key regional powers and promoting conditional engagement with North Korea, while also enhancing South Korea’s role in the international community.

The seven point doctrine of the present administration can be characterized as: Complete denuclearization and opening of North Korea; Pragmatic diplomacy based on a national consensus; Strengthening of the ROK-U.S. alliance; Expansion of Asia diplomacy in partnership with other regional states to move toward the opening of an Asian era; Contribution to the global community as the world's 12th economy and a mature, responsible nation; Energy diplomacy to join the group of most advanced economic nations; and Cultural diplomacy to capitalize Korea's soft power through mutual opening and exchanges in the region and the world.

In an exclusive interview, Mr. Kim Sung-Hwan, Senior Secretary to the President for Foreign Affairs & National Security explained about the foreign policy orientation of the present government. Excerpts:

-The Lee Myung-bak administration is actively pursuing a foreign policy vision: “Global Korea”. In order to realize the vision, the administration has stepped up its efforts to contribute to global peace and prosperity with focus on easing financial difficulties, combating terrorism, the proliferation of weapons of mass destruction (WMD), climate change and other global challenges. Hosting a G20 summit in Seoul this November and strengthening its contributions to the international efforts to rebuild Haiti, Afghanistan and Iraq are good examples of the administration’s such efforts.

On North Korea, the administration is committed to building up mutual trust and common prosperity in inter-Korean relations through dialogues with a firm belief that the two Koreas should fully cooperate on a wide array of agenda including North Korea’s nuclear issue, not only on economic issues.

The Lee Myung-bak administration will continue to work with the international community to bear fruit in its efforts to advance the Global Korea vision built on what it has achieved.

-Despite the previous administrations’ efforts, as you pointed out,the inter-Korean relations did not see any significant improvement mainly due to the lack of North Korea’s cooperation. Particularly, the nuclear issue remains unresolved although the Republic of Korea, in cooperation with the international community, has tried to deal with the issue over the past two decades.

Considering this, the Lee Myung-bak administration places a top priority on the nuclear issues and persistently pursues the resolution of the issue through dialogues between the two Koreas and with other participating countries in the Six-Party Talks, which has been a main venue for negotiations. The administration’s initiative, the so-called “Grand Bargain”, is to address the nuclear issue in such a comprehensive way that North Korea will be able to get a broad range of benefits, ranging from economic assistance to security guarantee, once it makes a strategic decision to abandon its nuclear programs.

As President Lee puts it, peace has to be maintained to realize reconciliation and cooperation on the Korean Peninsula. The Republic of Korea and North Korea, as two directly involved parties of the Peninsula, should work together to address all pending issues, including the nuclear issue, through sincere and candid dialogue. The Lee administration will continue to seek ways to bring North Korea back to the dialogue table and to hammer out solutions on the pending issues in close cooperation and consultation with the international community.

-As the FTA provides a wider interface between the two sides, I am sure, the industries of Korea and Europe will be and must be more interconnected in all aspects of their activities. In additions, the FTA will also bring EU investors not only more opportunities but also better protection and effective safeguards. It is high time for EU investors to explore and expand their partnership with their counterparts in Korea. In case they should come across any room for further improvement, in terms of government regulations or local practices affecting transaction costs, any proposal or suggestion from business community is always welcomed by the Korean Government.

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Rascal, the ugliest dog in the world

Rascal won the title of ugliest dog Sunday at the 15th annual Ugly Dog Contest at the Del Mar Fairgrounds in California. His owner boasts that Rascal is the 'world's ugliest dog.'
I am sure my four dogs will love this video and laugh their heads off. Have to show it to them tonight!

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HP Slate takes on iPad

Even as I am excitedly waiting for the iPad to go on sale, i was caught unawares by the news that HP is ready with its own version of a tablet called Slate that will run Windows 7 operating system and support Flash. While the above videos that the company released looks promising, one will have to wait and see. I have never been a fan of the windows OS and am pretty sure that I will settle for the iPad. Just hope that the HP tablet does not keep crashing as frequently as the desktop/laptop versions!

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Interview: Ms. Regina Lee, General Manager, Shinhan BNP Paribas Asset Management

Shinhan BNP Paribas Asset Management, headquartered in Seoul, is a joint venture between Shinhan Financial Group and the French financial group, BNP Paribas. It is the fruit of an eight-year-old partnership between one of the three largest Korean financial groups and the largest euro-zone bank by assets.

In January 2009, Shinhan BNP Paribas Asset Management was created when Shinhan BNP Paribas Investment Trust Management and SH Asset Management merged. Shinhan BNP Paribas Investment Trust Management was created in 1996 as Shinhan Investment Trust Management and in 2002 the name changed to Shinhan BNP Paribas when BNP Paribas acquired a 50% stake.
As noted by Ms. Regina Lee, General Manager, Real Estate Investment Team, the joint venture is currently ranked third in the Korean asset management market which is crowded with over 60 players, and has 34 trillion won worth of assets under management.
She pointed out that the Shinhan Financial Group Co. Ltd. was incorporated on September 1, 2001, and is Korea's first financial holding company that delivers comprehensive financial solutions through a powerful One-Portal network. Its subsidiaries offer quality financial products and services in commercial banking, corporate banking, credit card, private banking, asset management, investment banking, brokerage and insurance service.
The company has 21 offices in nine countries, including the U.S., the U.K., Japan, China, Germany, India, Hong Kong, Vietnam and Singapore. Currently, Shinhan Financial Group is listed on both the Korea Stock Exchange and the New York Stock Exchange
BNP Paribas is a European leader in global banking and financial services and is one of the 4 strongest banks in the world according to Standard & Poor's. The group is present in over 85 countries, with more than 168,000 employees. The group holds key positions in three major segments: Corporate and Investment Banking, Asset Management & Services and Retail Banking. Present throughout Europe in all of its business lines, the bank's two domestic markets in retail banking are France and Italy. BNP Paribas also has a significant presence in the United States and strong positions in Asia and the emerging markets.
“Both BNP Paribas Group and Shinhan group are trying to create synergies, so we are transferring capabilities between us. The special assets division of this company invests not just in real estate but also infrastructure and is engaged in investment finance,” she said.
Regarding real estate assets, she noted that the company owns around 1.005 trillion worth of real estate assets and ranks number 2 in terms of real estate assets alone.
“Our company started the real estate investment business back in 2006. Since 2007 we have recorded an average growth of more than 100 percent. Over the last two years the market has been quite stagnant but we were still able successfully acquire 300 billion worth assets this year and seek to increase asset size by 2 trillion won by 2012, to become the number one in the industry.”
The investments made by the company have been in prime grade A office buildings. Being very competitive assets, one can expect high capital gains and steady returns averaging 8 percent, she said.
Speaking on the strengths of the company she noted that the assets under management not just combination of number and figures but these are assets where the life stories of customers are embedded.
“We try to keep that core value in mind whenever we do our business. Many deals are concluded upon cooperation of many market participants as well as many stakeholders. So I think there should be no problem in closing deals if there is cooperation among the various participants. All the parties have different interest in mind but if they all cooperate it will be for the good. Successful deals require good people and good teams, both internal as well as external,” she said.
As for the real estate market in Korea she noted that last year was not very good, given the global economic meltdown. However, the market picked up in the second half, driven by Korea’s economic performance. This is different from other countries in the world.
One important differentiating trend in Korea is that the real estate market is driven by two segments- asset market and leasing market.
“Asset prices have increased steadily and this is because there are not many qualified tradable assets in the market. This year the decoupling between the leasing market and asset market is likely to continue for the time being.”
Negative factors in leasing market such as decline in leasing prices could also continue for the time being. In the mid to long term, this kind of trend is limited. It is not going to continue for long period of time, she said.
Ms. Lee said that the decoupling trend between the two markets is attributable to two factors. First is intensified competition from increase in market participants and second is increase in strategic investors who have relatively smaller expected returns.
Last year 20 players such as asset custodians entered the market this helped intensify the competition in the market. Assets prices were driven by such stiff competition in the process. This could result in formation of assets prices that do not fully reflect the true value of assets.
“As I said earlier the asset prices were also driven by increase in strategic investors, but this type of trend should only be limited to high quality assets. This year the financial market appears to be conservative to real estate market, so this year I think it should be an increase in distressed projects.” This is because of decrease in funding sources and deterioration in asset values, delays in projects and increase in capital costs , uncertainties in leasing market (construction may be cancelled etc.) Increased needs to find financial needs for this kind of distressed assets offers good investment opportunities if we can design a good deal structure and find strong deals. Market competition is going to get fiercer but this should only be limited to the primary business of buying and selling assets so there should be some changes in the industry, she said.
Another characteristic trend, she noted is that the real estate market has to businesses-Primary business of buying and selling real estate space and the secondary business of adding value to these spaces. She expects to find new business opportunities in the secondary business.
“So I would like to personally refer to this as a shift from the primary to secondary business in the real estate industry. Until now market participants were engaged in competition in the primary business, but in the future we should increase competitiveness in the secondary business of real estate. We cannot call it as the main trend but it should be,” Ms. Lee said.
Until now office buildings took the majority of real estate investment because the infrastructure was in place. Not just investment itself but also the services that manage the investment. If the shift from primary to secondary does occur then the investment which focused on residential and office buildings should now shift to industrial buildings. Value can be generated from services that can arise from these real estate assets, she noted.
Comparing Korean real estate market with other countries in the region she noted that every real estate market depends on the industries that are developed in the country. So if we talk about real estate of certain countries we should look at industries of that region first.
“The Japanese market over the last ten years has seen the bubble bursting and industries suffer from deterioration of competitiveness. The real estate market can only move in tandem with industry of that country. So the Japanese market may have some weaknesses. The demographic terms the country’s competitiveness also deteriorated as well. However due to economic strength of Japan there should be steady demand for high quality assets.”
She also noted that a lot of investors are interested in Chinese and Indian market and a lot of studies are going on about their growth potential. But when it comes to making investment decisions one should have a look at the infrastructure in these countries.
The Korean market has become open to foreign investment over the past ten years and has sufficient infrastructure for real estate business. The industries are growing in competitiveness, so the Korean market can be a good platform for investors who want to invest in emerging markets. Moroever there is a very low vacancy rate over past ten years and the leasing fee has not changed substantially.
Although last year, many foreign investors disposed a lot of assets for liquidity, this year they will return, she predicted

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Linux Mint- a fantastic alternative to Windows

I have never been a fan of Windows and found the outdated capabilities of the operating system an annoyance. For this reason, I stopped using my desktop computer at home (with Windows OS) and switched over to an iMac 2 years ago. Prior to that I had also bought a Macbook for my girlfriend and found that the learning curve was really not as steep as people made it out to be.

Slowly but surely I got infatuated with my Mac and have never looked back since. Although, I still use Windows at work, since this is Korea, and there is no way out  ! Moreover since my girlfriend needs to use Internet Explorer for all her banking needs I resultantly partitioned my iMac to install Windows 7.
This arrangement works beautifully for me. I use the Mac OS part while my girlfriend uses the Windows section. However, I couldn’t but help notice my old desktop gathering dust in a corner. So I decided to make better use of it, and bought an S-cable to hook it up to my 42 inch TV to watch streaming video. The only problem was that my computer kept crashing (which, while not surprising, was really very frustrating).
Last Sunday, I finally got fed up with the blue screen of death and decided to try out the GNU/Linux variants. This was not my first attempt at installing Linux on my computer, having done so a couple of years ago. At that time, I gave up because of the steep learning curve. This time however, my internet research showed that many of the Linux distros have advanced GUI capabilities, with many more software options. So finally I narrowed down on 3 distros- Ubuntu , Linux Mint and Mandriva . I would have loved to try Red Star, but couldn't find it anywhere ;)
Anyway, I installed all the three of them (takes just 20 minutes to install), one at a time to test out the different capabilities and then decided to stick with Linux Mint.
Originally launched as a variant of Ubuntu with integrated media codecs, it has now developed into one of the most user-friendly distributions on the market - complete with a custom desktop and menus, several unique configuration tools, a web-based package installation interface, and a number of different editions. Perhaps most importantly, this is one project where the developers and users are in constant interaction, resulting in dramatic, user-driven improvements with every new release.
Some of the key advantages of Linux Mint are:

•It's one of the most community driven distributions. You could literally post an idea in the forums today and see it implemented the week after in the "current" release. Of course this has pros and cons and compared to distributions with roadmaps, feature boards and fixed release cycles we miss a lot of structure and potentially a lot of quality, but it allows us to react quickly, implement more innovations and make the whole experience for us and for the users extremely exciting.

•It is a Debian-based distribution and as such it is very solid and it comes with one of the greatest package managers.

•It is compatible with and uses Ubuntu repositories. This gives Linux Mint users access to a huge collection of packages and software.

•It comes with a lot of desktop improvements which make it easier for the user to do common things.

•There is a strong focus on making things work out of the box (WiFi cards drivers in the file system, multimedia support, screen resolution, etc).

As this blogger states- “Simple: The derivative is better.”

I would highly recommend it to anyone who if fed up of Windows, but afraid to switch over to the Mac. Best of all, it is free!

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