Friday February 9, 07:19 PM

SKorea pardons tycoons to boost economy

SEOUL (AFP) - South Korea has announced pardons for more than 430 convicted business leaders and politicians in an attempt to reinvigorate the economy 10 years after the Asian financial crisis.

The list agreed at a cabinet meeting includes Park Yong-Sung, a member of the International Olympic Committee and former chairman of the construction conglomerate Doosan Group, and the sons of two former presidents.

But officials said the presidential pardons did not include Kim Woo-Choong, jailed founder of the now-defunct Daewoo Group, partly because the cost of salvaging his bankrupt business had been so huge.

The special amnesty aims "to help create a favourable atmosphere to focus on economic recovery and achieving national unity," the justice ministry said in a statement.

"This measure is expected to provide momentum for creating new jobs and a second economic leap forward and laying a stepping stone towards national reconciliation."

Justice Minister Kim Sung-Ho said the government had decided to give businessmen a second chance on the 10th anniversary of the crisis.

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South Korea launched a drive against the excesses of its mighty conglomerates, or chaebol, after the crisis, which sparked a spate of bankruptcies.

But high-profile business leaders have often received lenient sentences or have been pardoned.

Most of the 160 businessmen who will benefit from the latest amnesty were jailed for embezzlement, tax evasion, fraud or donating illegal political funds.

Activist Park Kun-Yong, of the People's Solidarity for Participatory Democracy, criticised the move.

"The government always uses the pretext of helping the economy whenever it amnesties powerful businessmen," he said. "The amnesty will be harmful to the economy in the long run as it will only help strengthen dictatorial corporate governance by the tycoons."

The amnesty, effective Monday, was granted to mark the fourth anniversary this month of President Roh Moo-Hyun's inauguration.

Park Yong-Sung was convicted last year of embezzling 30 million dollars from Doosan companies in a family feud over control of the group, and his IOC membership remains suspended.

He was given a three-year suspended jail term and an eight-billion-won (8.2-million-dollar) fine.

Kim Man-Ki, spokesman for Pyeongchang's bid for the 2014 winter Olympics, said the amnesty would help the town with its application.

"In light of what has happened in the past, the IOC is expected to fully reinstate chairman Park at an early date," he said, adding that the IOC had suspended Park for six months until March 15.

Also pardoned were Park Jie-Won, who was chief of staff for former President Kim Dae-Jung; Kwon Ro-Kap, a key aide to the former president; Kim Hong-Il, an ex-lawmaker and the eldest son of the former president; and Kim Hyun-Chul, the second son of ex-President Kim Young-Sam.

Park Jie-Won was sentenced in September to three years in prison for bribery. He was also convicted of abusing his power and violating domestic laws while orchestrating the Hyundai group's secret money transfers to North Korea ahead of the 2000 inter-Korean summit.

Daewoo's Kim was jailed for eight and a half years for fraud and embezzlement. Last December a court suspended the sentence for three months to allow him to receive treatment for heart disease.

Daewoo had debts of 82 billion dollars when it collapsed in 1999 in one of the world's largest corporate failures. The government had to spend some 30 trillion won (now 32 billion dollars) to rescue its subsidiaries.

The amnesty comes four days after the head of Hyundai Motor was sentenced to three years in prison for creating a multi-million-dollar slush fund.

Chung Mong-Koo remains free pending an appeal in which some commentators predict his sentence will be suspended.