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[ Trade & Products > Chamber Alley ]

hat began as a social club for expatriate American business people has since emerged as Korea¡¯s most powerful foreign business organization and in the process has won a trusted place within the government as an advocate for positive change and reform.

  Such is the standing of the chamber that even companies with no direct affiliation with the United States find it advantageous to have AMCHAM membership because of the clout it wields in dealing with the government, making it the de facto organization for foreign business in Korea. As an indication of how deeply AMCHAM has become woven into the fabric of local business life, Koreans now comprise a significant proportion of its membership.

  Formed directly after the signing of the armistice in 1953 that concluded the hostilities of the Korean War, the American Chamber of Commerce in Korea (AMCHAM) celebrates its 50th anniversary this year. The changes in the chamber¡¯s membership, focus and works reflect the vast changes that Korea has gone through in the country¡¯s passage from a war-ravaged, pre-industrial dictatorship to one of the world¡¯s major trading nations and a fully functioning democracy.

  In the early days of the chamber when most of its 200-or-so members lived and worked within a short distance of the (now Westin) Chosun Hotel, the chamber had a strong social function. However, the downside was that the chamber operated as a ¡°A small, struggling organization with insufficient funds and insufficient staff ,¡±notes S.H. Jang, of S.H. Jang Associates, AMCHAM¡¯s longest standing member who served on the chamber¡¯s board for 10 years. Mr. Jang became a member in the early 1970s as the country representative of Swiss pharmaceutical manufacturer, Sandoz, at a time when both domestic and foreign businesses were subject to the strictures of the exportoriented policies of President Park Chung-Hee and the only o rganization that represented foreign business was AMCHAM.


  THE FIGHT FOR MARKET ACCESS
  The social character of the chamber began to take a backseat with the onset of the 1980s when it opened an office, systematized its management and focused on the emerging issues of the day that challenged, and by times seemed to overwhelm foreign managers. Foreign company interest in Korea was mounting with the growth of the market and a push by the government to develop consumer goods industries. At the same time, the right to strike was legalized for the first time in Korean history as an adjunct to Seoul¡¯s hosting of the 1988 Olympic Games, a move that resulted in long pent up worker frustrations quickly themselves manifesting in industrial action.

  Labor issues came to the fore for AMCHAM, as did those pertaining to market access as Korea prepared to become a signatory to the Uruguay Round of the World Trade Organization (WTO). Restrictions still abounded, and American business was starting to worry about protecting its intellectual property. The chamber upped the pressure for greater market opening that the WTO agreement would permit, while new obstacles manifested themselves in the form of civic organizations who were opposed to the new conspicuous consumption as antithetical to Confucian values.

  Mr. Jang describes this as AMCHAM¡¯s ¡°Korea bashing¡± phase, characterized by an aggressiveness in dealing with trade matters so strident that some chamber employees were embarrassed to say who they worked for in social situations.

  ¡°Japan bashing was also popular at the same in regard to the auto market,¡± said Mr. Jang. ¡°Japan was very much closed against U.S. imports and it was the same in Korea. Many markets were restricted.¡± However, he ascribed at least part of the bluster to some expatriate managers being less successful than others at coping with the rapidly changing business environment around them.

  In 1985 AMCHAM launched one of its most successful and visible initiatives, its annual ¡°Doorknock¡± campaign in Washington D.C. This involves the chamber executives visiting the capital and dividing into teams to lobby leading decision makers in Congress, the Senate and the national think tanks.

  ¡°We started Doorknock because back in those days, the chamber faced lots of challenges and difficulties in coordinating our efforts with the (Korean) government,¡± said Tami Overby, AMCHAM executive vice president, a participant in every Doorknock since 1989. ¡°It was said at the time that The Road to Kwachon (location of the central government offices) is through Washington D.C.¡¯¡± Ms. Overby said the aim of Doorknock changed in the mid-1990s during the run-up to Korea¡¯s accession to the Organization for Economic Cooperation and Development (OECD) in December 1996.
  ¡°We coincidentally changed our leadership at the same time to gain a new president and we now look for new areas in which we can partner with Korea.¡±

  THE DOORKNOCK ERA For example, AMCHAM has continuously lobbied for Korea to be included in the U.S. visa waiver program to make it easier for Korean business people and tourists to travel to the United States. (Korea is the only country among the top-five sources of visitors to the United States whose nationals require a visa.)

  Ms. Overby said in recent years the thrust of Doorknock has been to ¡°Educate D.C. about the U.S./Korean trade picture,¡± noting that Washington opin-ion leaders are not always up to speed on the enormous changes that have taken place in the country since the economic crisis of 1997/8. ¡°It¡¯s a challenge to help D.C. understand the positive changes that have taken place here,¡± said Ms. Overby.

  Mr. Jang said that it was during the mid-nineties that the chamber switched from being a Korea basher to a cooperative agent of change, a move marked by a closer engagement with government officials who were naturally reluctant to address issues that were socially sensitive but of paramount importance to AMCHAM members, such as reducing the high taxes on imported cars.
  ¡°Much has changed especially since the crisis,¡± said Mr. Jang. ¡°There are now established channels of communication between Korean specialists and AMCHAM. Also, the Korean side is now keen to take advantage of the chamber¡¯s connections and leverage.¡±

  An important factor in this transition was the tenure of Jeffery Jones as president, the longest in the chamber¡¯s history that began in 1998. When Paul McGonagle¡¯s presidency was interrupted in 2000 because of a premature return to the United States, Mr. Jones took over and remained until 2002 when the position was assumed by current president, William Oberlin of Boeing Korea, A former Mormon missionary who arrived in Korea in 1971, Mr. Jones is a fluent Korean speaker and a member of the high-profile law firm of Kim & Chang.

  DON'T DO US NO FAVORS Mr. Jones¡¯ affection and empathy for things Korean - often to the point of referring to Korea as ¡°our nation¡± - helped considerably to advance the cause of the Korean/American business community and positively reposition the chamber in the public mind.

  Meanwhile, the channels of communication described by Mr. Jang continue to function to the mutual benefit of the chamber membership and Korea as whole. Ms. Overby explained that AMCHAM has formed four working-levels groups in conjunction with the Ministry of Finance and Economy (MOFE) that operate under a joint steering committee. ¡°The groups deal with taxation, foreign exchange, practices and regulations, and labor,¡± she said.
  ¡°We bring our experts and the Korean side bring theirs. We¡¯re looking on this as a model for advancing relations with other ministries. For example, we have proposed establishing a similar working group with the Ministry of Agricuture and Fisheries in the field of biotech.¡±

  On another front, mindful of the social polarization that has taken place in Korea since the crisis, the chamber has taken on a corporate citizen role expressed chiefly but not exclusively through its ¡°Partners for the Future Foundation¡± that supports vocational training programs and educational scholarships for the unemployed.
  Indeed, the improvement in the image and standing of AMCHAM was the chief reason President Roh Moo-Hyun invited Mr. Oberlin and Ms. Overby to participate in his recent state visit to Washington as members of the Korean delegation. This is the first time that foreigners have been accorded this honor.

  The relationship between AMCHAM and its host country has often been stormy given the sweeping nature of the changes that have taken place in Korea and the cultural differences of the parties involved. However, like any good marriage, the parties have persisted and the relationship has endured, in the mutual realization of both the need for each other and the possibility for further synergies. Ultimately, the relationship has been successful because it has adapted to changing circumstances, and as such, has reached a certain level of maturity.
  ¡°We¡¯re not asking for special favors,¡± said Tami Overby, explaining the chamber¡¯s current position. ¡°We just want to make the Korean business environment the most competitive there is.¡±
  With sentiments such as these, the next 50 years for AMCHAM promise to be equally successful.

  Excerpted from the forth coming book ¡°50 years: American Business and the Korean Miracle¡± by Andrew Salmon.

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