South Korea's new conservative government Monday announced plans to sell off a 49 percent stake in the main international airport as part of its attempt to reform state firms. Privatisation was a key campaign pledge by President Lee Myung-Bak, who took office in February.
But the campaign was delayed following months of street protests against a decision to resume US beef imports and against other policies, including privatisation. The finance ministry said Monday that 41 state firms would be privatised, merged or restructured under the first phase. It said the sale of the stake in Incheon airport would include a strategic link with a foreign airport operator to ensure international competitiveness.
The land and housing corporations will be consolidated into one body, while five public firms will be privatised initially. The plan includes the sale of a stake in Industrial Bank of Korea, which was set up to channel capital to small businesses, and the privatisation of the Korea Development Bank.
Plans for 14 companies which had received state bailout funds, including Daewoo Shipbuilding and Marine Engineering, will be announced by the end of this month. Last month the government announced it had dropped plans to sell off public utilities and the health care insurance system, in a major policy turnaround. The decision was prompted partly by fears that this could push up prices and fuel already high inflation.
Lee, a former Hyundai Construction CEO, pledged to follow a "small government, big-market principle" when he took office after a decade of rule by left-leaning presidents.
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