Korea's Large Corporations' Asset Ratio to GDP Ranks Lowest Among Major Countries

The Top 100 Companies' Total Assets Account for 17.7% of National Wealth, the Lowest Among 5 Compared Countries
The Decline in Asset Share Relative to National Wealth (-2.5%p) Is Also the Largest

[Asia Economy Reporter Kim Hyewon] An analysis has revealed that the proportion of large corporations' assets relative to national wealth (net national assets) in South Korea is among the lowest compared to major countries.

On the 20th, the Federation of Korean Industries analyzed the economic power concentration of the top 100 companies by assets in South Korea and four of the G7 countries (United Kingdom, Germany, France, Italy) for which national wealth data is available. National wealth refers to net national assets, which are the assets held by corporations, government, households, and non-profit organizations converted into monetary value.

In 2019, the total assets of the top 100 companies relative to national wealth in South Korea stood at 17.7%, ranking the lowest among the five countries compared. This figure is less than half of the United Kingdom's 44.9%.

Significant Decline in Top 100 Companies' Asset Proportion Relative to National Wealth Compared to 10 Years Ago

South Korea experienced the largest decline (2.5 percentage points) in the asset proportion of the top 100 companies relative to national wealth over the past decade. This decline is greater than that of Italy (-1.5 percentage points) and France (-0.3 percentage points). Conversely, the United Kingdom (11 percentage points) and Germany (1.3 percentage points) saw increases in the asset proportion of their top 100 companies compared to 10 years ago.

When analyzing the long-term time series of South Korea's large corporations' asset proportions, the share of the top 100 companies' assets in total corporate assets fell from 47.5% in 1985 to 31.6% in 2019, a decrease of 15.9 percentage points. Notably, the 2019 figure is close to the lowest point recorded during the survey period, 31.4% in 1996.

According to a 2019 survey of OECD member countries on the proportion of large corporations relative to the total number of companies, South Korea recorded 0.08%, ranking 33rd out of 34 countries. This is about one-ninth of Switzerland's 0.83%, which has the highest proportion of large corporations, and lower than Lithuania (20th), Poland (21st), and Turkey (26th), all of which have lower GDP than South Korea.

Yoo Jungjoo, head of the Corporate System Team at the Federation of Korean Industries, stated, "Compared to competing countries, the economic power concentration of large corporations is not high, and the number of large corporations itself is small, which is the current reality." He argued, "There is a need to revise large corporation policies focusing on curbing economic power concentration."

This content was produced with the assistance of AI translation services.