Inquiries to find someone who represented South Korea's new generation of business leaders appeared to be heading in the right direction the minute Milton Kim's name came up in conversation. 'He is 37 years old, US-educated, unafraid to speak out and runs the securities business of the Ssangyong Group, part of a powerful business elite,' said an old Korea hand. These appeared perfect credentials. However, it was his name which at once intrigued and offered hope that here was a fresh face for Korea's battered economic image. Milton Kim. What was the origin of this curious fusion of East and West? A first-time visitor to Seoul could be forgiven for concluding that half the population is called Kim. It is a name which dominates business and politics so there was no surprise in that. But what of the first name? Were his parents friends of a youthful Milton Friedman, fans of jazz vibes maestro Milt Jackson or lovers of the English 17th century poet activist, John Milton? 'I was the youngest of six children and the only one given an English name. My father liked the poetry of John Milton,' he replied, with only a trace of resignation to a question he is frequently asked. 'Maybe he was a poet at heart.' His father, Kim Sung-kon, who died when his son was 14 years old, was anything but a poet. He was one of former president Park Chung-hee's right-hand men in the 1960s who knew much about the inner workings of the government during this murky period in the country's history. A falling out with Park led Kim Sung-kon to the United States where Milton Kim was born. Before the rift, however, he was the beneficiary of considerable government largesse - some say US$100 million. With this kick-start, he grew an existing business into an empire which came to include interests in the cement, construction, automotive, paper, insurance and securities industries. Kim Sung-kon's fondness for John Milton may have grown out of his affinity with the ideals the poet espoused on the subjects of civil liberties and reform. However, history is casting Kim Sung-kon and his contemporaries who built up South Korea's industrial conglomerates, or chaebol, in a different light. These men and their creations are under siege from the new government of President Kim Dae-jung. Before this leadership, which has been in power for little more than two months, these industrialists thrived courtesy of corruption and cronyism and created legacies of poorly managed, bloated industrial empires. The only affinity the new administration could have with John Milton, after South Korea has slumped from economic greatness into the hands of the International Monetary Fund, is knowledge that he wrote the masterful Paradise Lost. Milton Kim enters this highly divisive debate about reform with a refreshing openness and concern for compromise. His foreign education, refined by two years of training at Citibank, has cultivated liberal, east-coast political leanings and relieved him of the nationalistic baggage which has driven industrial policy for the past four decades. Looking every inch the sharp, 1990s banker in the executive suite designed by his sister, he qualifies his long-term optimism by stressing the urgent need for reform of the financial system. He is one of the more high-profile members of a new Seoul elite who have returned with MBAs to assume senior positions in family-managed companies. So how does he cross the cultural divide to become an agent for change with an American accent in the sheltered, traditional environment of Korea? 'I'm Korean but I was not raised here and my education was not Korean. I feel comfortable with both cultures,' he said. 'I feel lucky in that respect. Despite the amount of time I spent in the US I am fluent in Korean but also I am able to connect culturally here. I respect traditions like bowing to your elders but when I go to New York, I have nights out with my buddies and talk baseball.' He gave up his US citizenship. 'Who needs two passports? I feel that I have an international background and that has shaped the way I think. But I'm Korean. I chose to live and work here. I want to raise my children here and be buried here.' Yet, there is no trace of tradition in the business principals he is championing. Among other things, they challenge the stranglehold of family control over boardrooms which is blamed for tolerating obsolete management principles such as emphasising production levels over productivity. 'I consider myself as [a] professional manager. The aim is to find the best talent there is. My chief analyst was hired from Jardine Fleming. My job is to find the best talent there is. Too many of the chaebol are being run by family members and that is holding back Korean business,' he said with a frankness seldom heard inside the confines of a chaebol building. To him, as chief executive officer of the Ssangyong Investment, competition, whether it be local or international, is fundamental to the creation of an efficient financial system. 'It is good to have direct foreign investment and I'm one of the leading proponents of allowing foreigners to buy whatever they want; land, shares, companies. The regulatory barriers have to disappear.' This reflects the South Korean Government's stated policy yet it is running into powerful opposition from vested interests. The Korean people's deep-seated nationalism is reflected in opposition from industry and trades unions to foreign ownership. For them, it is bad enough to sell local assets to offshore interests but it hurts all the more when they are going on the market at rock-bottom prices. Milton Kim sympathises with this viewpoint. The government's rush to attack the role of chaebol ignores the contribution they have made to economic advancement. However, he adds that the conglomerates dragged their heels and now operate outmoded business models. 'They [the chaebol] were slow to change and they need to now in order to create value for their shareholders and not just concentrate on their size. But what the government is doing is changing the rules suddenly and telling the chaebol to do this and that,' he said. 'It's unrealistic to assume that the chaebol can change so suddenly. There has to be a realistic grace period so that groups can cope with a new way of doing things.' At the centre of the problem is the pricing of the potential asset sales. 'The government is telling the chaebol to fire-sale everything at a time when we are all in a similar situation - suffering liquidity problems. The only ones who can buy things at the moment are the foreigners and I don't think we should sell off things at fire-sale prices when we all know that Korea is at the bottom.' This summarises the dilemma of Korea's financial sector. It acknowledges the pressure on chaebol to dispose of assets at present prices. But the foreign groups realise they have time on their side and can afford to wait with the likelihood that conditions will tighten, driving prices lower. On this sticking point Milton Kim sides with the foreigners and at the same time, exposes another area where his Western experience takes over from Eastern instincts. 'You should have no limit as to how capital is transferred from one county to another. That is the way developed countries work,' he said. 'I also realise that I'm a minority here. Let's face it, this is a very nationalistic country and we have a lot of pride. 'But this should not translate into a dogmatic nationalism where only Koreans own companies here. Whether we like it or not, those days [are] over.' He opposes the views of those who believe the chaebol can trade out of their problems via expansion financed through borrowing in their time-honoured fashion. Most notable among this band is Daewoo Group's chief, Kim Woo-choong, who is publicly critical of government policies. 'There is a lot of risk in being cavalier and saying we must grow,' Milton Kim said. 'You have to be more pragmatic. This is a real watershed in Korean economic history. 'There are a lot of people who, and I give them credit for it, have helped build Korea, but we are not going to get through this period for two or three years and then . . . go back to the good old days.' His actions certainly display a willingness to get on with the process of change. He is leading a buy-out of Ssangyong Investment in tandem with a foreign backer which will become the majority shareholder, the first ever such move by a member of a chaebol family. This would leave his two elder brothers in charge of the rump of the empire. They face the task of swinging the Ssangyong Group around at a time when it is saddled with massive debts. The automotive and paper businesses have already been sold and more will follow the securities business disposal, if necessary. Milton Kim says that his family's group has been at the forefront of the trend towards rationalisation, although the sale of the automotive division was certainly forced by a financial imperative. 'The public is not differentiating between chaebol. We're all grouped together and taking the fall for what's happened with the Korean economy. But I think you really have to go deeper than that and look at individual groups and what they have done or not done,' he said. 'But there is a witch-hunt and all chaebol are the bad guys. Someone has to take the blame and the chaebol are an easy target.' While apportioning blame, he believes the trade unions are also guilty of contributing to the present crisis. For the past decade, Korea witnessed an explosion in wage levels, giving rise to the rapid creation of a middle class. 'There has been a huge transfer of wealth to the labour side. I know this is not the politically correct thing to say but Korea became unproductive and that had a lot to do with labour costs.' This willingness to speak out gives cause for optimism that positive forces are at work within South Korea's corporate sector which will lead an irresistible drive towards change. However, the strides which have been made towards political reform with the election of President Kim Dae-jung have still to be matched by business. 'I hope Korea can work out its problems. We have suffered a lot. We have been able to become one of the wealthiest countries in the world from being one of the poorest,' he said. 'I hope that this was not an aberration and that we continue to progress and make this country wealthier. Not just in money terms but also culturally. There has to be more of an awakening.' Milton Kim may not be an authority on his namesake's poetry. But perhaps Paradise Regained should be on his reading list. Milton Kim, 37, was born in the US. His father, Kim Sung-kon, was a leading politician in the government of Park Chung-hee who, after a falling out with the president moved to the US. He returned to develop the Ssangyong empire which is a leading force in the Korean cement, construction, insurance and petroleum industries. Milton Kim received a BA from Brown University in 1983, a MSc from Georgetown University in 1986 and an MBA from Insead, France in 1989. He joined Ssangyong Investment and Securities in 1990 and became chief executive in 1995.