Good afternoon. I would like to thank all of you for taking time today to attend the Korea Investment Service Center’s Korean Infrastructure Projects and Investment Seminar. Before introducing you to our speakers and members of the delegation, let me take a moment to talk about some of the reasons I believe Korea represents one of the most exciting investment stories in the world today.

About ten years ago, I was working on a consulting assignment for one of the world’s largest financial institutions. Our role was to support the launch of their new telecom finance division. A review of the data revealed that Korea possessed high growth rates and on paper -- perhaps the most attractive market in Asia for telecom equipment and services. We brought this to the attention of the client -- suggesting Korea as an initial focus. This recommendation was immediately dismissed. They viewed the market as closed and impenetrable, preferring other countries such as Indonesia, which they viewed as more promising and inviting.

I mention this anecdote to illustrate a critical point. The Korean economic miracle was based upon an insular strategy. Until the mid-1990s, the nation had been able to finance one of the world’s strongest growth rates -- for over thirty years -- largely through its domestic savings. Drawing on its traditional spirit of self-reliance, it developed a world-class presence in sectors ranging from semiconductors, chemicals and steel to industrial components, textiles, ships, and construction. Korea’s great success, however, was accompanied by rising living standards and expectations. Newer low cost competitors including the Southeast Asian counties, and more recently China, followed in their path. Over time, this eroded the competitive advantage they had built as a low-cost manufacturing power.

By the mid-1990s Korea had grown to the point where it was the fifth largest trading partner of the United States and the world’s eleventh largest economy. Many Korean firms, particularly the large conglomerates, realized the need to develop offshore. The traditional Korean tendency to go it alone, however, provided few examples of successful joint ventures and business alliances between Korean and foreign firms and most foreign consumers had little or any awareness of Korean brands or products. Investments into Korea were even more scarce, and for many years the Korea Fund, a U.S. closed-end mutual fund, traded at a large premium to net asset value due to restrictions that were placed on foreign investors that sought to directly invest in the stocks of Korean companies.

Realizing its future growth and prosperity was ultimately dependent upon the nation’s ability to reach out and internationalize its economy, Korea moved to adopt a national globalization policy. The IMF crisis intervened in 1997, though in retrospect this can be seen to have greatly accelerated this process.

To resuscitate its economic standing, Korea rapidly introduced the reforms needed to create a more market-driven economy. Substantial progress has been achieved through enhanced corporate governance and profitability; disposal of non-performing loans and financial sector consolidation; a more flexible labor market; and in the public sector, privatization, deregulation and decentralization.

Korea’s success in recent years is reflected in ratings upgrades and the dramatic change of its external position. A net debtor with obligations totaling $54 billion in 1997, earlier this year Korea achieved a net credit of $41.6 billion. Reserves have stood as high as $108 billion — higher than the U.S., Germany or France.

These achievements are now widely recognized by international investors. From 1998-2001, Korea attracted nearly $52 billion in foreign direct investment. This is more than twice the $25 billion it gained in the 36 years before the crisis. Ninety-eight percent of all industrial sectors are now unrestricted and foreigners own about 37% of listed Korean shares. Among Korea’s most competitive and widely-held companies such as Posco, Samsung Electronics and Kookmin Bank foreigners hold about 66% of listed equity. This is an extraordinary change from a few years ago.

Changes in banking practices have also reduced non-performing loans from 13% of assets in 1999 to 3.4% last year. Korean banks, which suffered a 4 trillion won loss four years ago, now earn net profits totaling 5.2 trillion. Corporate reorganization has also proceeded rapidly. Of Korea’s top 30 firms in 1997, 16 have been closed or significantly reorganized. Companies that remain have downsized and sold assets in an effort to maximize efficiency.

In addition to more robust financial strength, Korea has also begun to emerge as an international technology center, positioning itself as a world leader in areas including, but not limited to broadband, Internet gaming and mobile communications. Moreover, Korean firms, including Samsung Electronics, Kia, Hyundai Automotive and LG have all made significant progress in launching high-end proprietary brands that have been well received by U.S. and other foreign consumers.

Korea, which had formerly relied upon exports as the primary engine of its economy, is also developing as one of the more robust domestic markets in Asia. Its well-educated work force is quickly transforming itself into a sophisticated consumer society. Consumption of goods and services is growing at a rapid rate — making the nation an increasingly attractive destination for foreign consumer and luxury goods manufacturers.

One other trend, however, is of critical importance to investors that focus on infrastructure investment – the subject of our seminar today.

In addition to the achievements that I have mentioned, which have strengthened Korea from both the perspective of its domestic market and its international competitiveness, Korea has come to recognize, and is now moving rapidly to take advantage of its strategic location. It is making significant investments to develop the expanded physical infrastructure needed to position the nation as the business and financial hub of Northeast Asia. This includes the new Incheon Airport, which possesses the capacity to carry 27 million passengers and 1.7 million tons of cargo annually. Over the next two decades, the airport will grow in phases to handle 100 million passengers. It is the largest infrastructure project ever undertaken in Korea. Additional infrastructure includes a renovation of Incheon’s seaport and the resumption of rail traffic through North Korea and all the way through to Western Europe.

In addition to these central government initiatives, Korean municipalities and provinces are also moving to develop a wide range of projects that will serve to further expand their regional, and Korea’s overall, economic potential in the years and decades to come. This includes technology, tourism and industrial-oriented initiatives including the development of public works, residential and commercial real estate, resorts, R&D centers, transportation facilities and much more.

Our visiting delegation includes representatives from Gangwon Province, as well as Gyeongbuk, Jeju Island and Jeonbuk, Incheon Metropolitan City, Seoul and Daejon and the Korea National Tourism Organization.

They have all traveled here today to speak with you about their regional development plans and local investment opportunities, as well as general trends within their respective jurisdictions. After lunch, I urge you to meet with delegation members individually so that you might exchange views and gain further insight into their activities. If you have not already scheduled appointments, please take a moment after lunch to visit the registration desk, where representatives can help you to arrange a convenient time.

I would now like to again thank you for your participation and to commend our first speaker, Mr. Pyeong-Rak Choi, Executive Director General of the Korea Investment Service Center for his helpful introductory comments. In a moment I will introduce you to Mr. Dae-Hyung Cho, Head of the Investment Consultation Team of the Korea Investment Service Center, who will speak to you about Korea’s Business Environment and Foreign Investment Incentives and provide an introduction to the Infrastructure and Investment Projects offered by the visiting delegation. We will then have time for a question and answer session, after which we will adjourn for one-on-one meetings.

Finally, before concluding, should any of you have questions in the weeks to come after this event, I would urge you to contact representatives of the Investment Consulting team at KOTRA, the Korea Trade and Investment Promotion Agency here in New York. They would be pleased to help you in your efforts to better understand and enter into the Korean market.

Please let me now introduce Mr. Dae-Hyung Cho, Head of the Investment Consultation Team of the Korea Investment Service Center.