Big firms banned from tofu, 24 other businesses

A presidential panel to promote shared growth on Friday released an updated list of 25 industry sectors where conglomerates will be advised to withdraw or have their business expansion restricted.

The Commission on Shared Growth for Large and Small Companies said large companies will be banned from expanding into over-competitive sectors or those traditionally occupied by small businesses, including tofu, plate glass and ready-mixed concrete.

The decision is the latest instruction after a series of discussions with conglomerates since May. The decision is not legally binding.

Of the 45 business items discussed, tofu, coffee beans, quicklime, plate glass and safety glasses will be areas in which large companies with more than 150 billion won of annual revenue would be advised against making further investments.

“We decided to urge large companies not to further intervene into the tofu business especially those sold unwrapped in wet markets and local stores. They should also exit from the mass-production of tofu supplied to big department stores,” Chung Un-chan, former prime minister who heads the presidential panel said.

The panel recommended large businesses to withdraw from 16 sectors, including kimchi, fish cakes and breweries.

It recommended large companies not to enter the government procurement market such as military supplies and to refrain from merger and acquisition of smaller makers.

The agency has been pushing to reduce market share of the country’s top 10 major conglomerates including Samsung Group, Hyundai Motor Group, LG Group and SK Group in an effort to promote shared growth. The aggregate sales of the four conglomerates recorded 603.3 trillion won ($554.22 billion), accounting for 51 percent of the gross national products

By Cynthia J. Kim (cynthiak@heraldcorp.com)