Japan, South Korea explore free trade.

             Political differences once in existence between Japan and South Korea once hindered the import and export industries of both companies. Now, with S. Korea's economic recession and Japan's economy staggering, there has been much conversation over the possibility of a free trade zone consisting of the two countries. This meaning the free movement of good, capital and people as President Kim Dae-jung of South Korea conveyed his government's position to gradually lift its country's ban on the Japanese culture. In the past, Japan's trade relationship with South Korea had been heavily restricted but with more meetings on the rise, South Korea promised that the previous discriminatory regulation on Japanese products would be eliminated in hopes to reduce South Korea's trade deficit with Japan. Prospects of the free investment agreement should be reached in two years. .

             Largest Chaebols' Pledge to Restructure Raises Doubts.

             The five largest business groups of South Korea, known as chaebols have promised to downsize, selling off some of their assets in order to reduce the debt-to-equity ratio but this promises is raising skepticism. The top five chaebols all claimed that they would reduce their affiliates by 40-70% and their debt-to-equity ratio to 2:1. However, the trend within the companies is showing absorption of their smaller companies rather than the restructuring and elimination of some of the companies' affiliates. In addition, rather than reforming and reducing, companies such as Hyundai has launched a 6-year $900 million tourism project with North Korea. Other chaebol companies have also entered into various expansion expeditions, using the merger of their smaller companies to have a decreased number of affiliates but no real cuts of reform or restructuring have been made since their promise in early December.

             With its economy staggering, nation doubts itself.