A political scandal has sparked massive anti-government protests in South Korea. President Park Geun-hye is facing questions about the financial dealings of an unelected confidante: Choi Soon-sil is accused of using her ties with the president to coerce local firms to donate millions of dollars to non-profit foundations that Choi then used for personal gain. The president has defied calls to step down, but the political scandal is happening at the wrong time for the country's economy.
South Korean growth slowed to 2.7 percent in the third quarter of 2016, down from 3.3 percent in the previous three months. Some of the biggest conglomerates are also in trouble: Samsung's smartphone recall, a strike at Hyundai Motor, and a major bankruptcy at Hanjin Shipping have hurt production.
Samsung is the biggest South Korean "chaebol", the country's giant, family-owned conglomerates that essentially control industry. Samsung revenue is roughly equivalent to 20 percent of South Korea's gross domestic product (GDP). Its closest rival is the Hyundai Motor group, but both companies are facing challenges and both are crucial to the country's growth outlook.
So, what is next for South Korea's chaebol? Is South Korea's economy at a changing point? After four decades of tremendous growth, are the prosperous times over? And, how will the Trump presidency effect China, South Korea and Asia-Pacific in general?
Florian Kohlbacher, the director of Economist Corporate Network, talks about the chaebol and the challenges facing South Korea's economy.
Also on this episode of Counting the Cost:
Financial mayhem in India: What was designed as a surgical strike against corruption has now sparked a mad scramble for cash. The government has banned 500 and 1,000 rupee notes - the equivalent of $7 and $15, respectively - which account for most of the cash in circulation. Officials say it is a way to root out tax evasion and corruption, but millions of Indians are now scrambling to exchange their old money for newly printed denominations. Will India's banknote crackdown end corruption? How will the government's banknote withdrawal effect the economy?
Middle Eastern Amazon: A billion-dollar e-commerce start-up in the Middle East called noon.com wants to rival Amazon and it's all part of Saudi Arabia's plan to become the biggest technology investor on the planet. But, is there a market for online shopping portals in the Middle East? Andrew Kitson, senior global analyst, BMI Research, talks to Counting the Cost about demands and challenges facing e-commerce in the Middle East.
Plane spotting: We went to the Iran Airshow - the first to take place since the lifting of international sanctions - to take a look at the country's aviation industry.
Source: Al Jazeera