The Japanese government needs to devise measures to support the development of small- and medium-sized enterprises in South Korea.
Even more so than in Japan, the Korean financial system operates on the basis of a convoy mentality. This proved to be the trigger of the current crisis. Japan has much to learn from South Korea's case.
The import diversification policy constitutes a de facto prohibition against the import of certain products from Japan. Even for imports from third countries, country-of-origin regulations ostensibly aimed at preventing indirect imports from Japan require that Japanese manufacturers provide a tremendous amount of information about their finished and semi-finished products in order to obtain country-of-origin certification. Required information includes the cost of raw and semi-finished materials, and even business secrets. (These requirements are due to be eliminated by July, 1999.)
In order to introduce greater flexibility into labor-management relations and enhance the economy's international competitiveness, the amended Labor Standards Law should be firmly enforced.