Creditors of South Korea's ailing Hynix Semiconductor are studying a plan to break the company into several units days after its board rejected a $3 billion asset sale to Micron Technology of the United States.

A group of South Korean banks which is owed $5 billion by Hynix Semiconductor says it may divide the firm. It hopes to slice it into units, both profitable and non-viable, and then put them up for sale.

The creditors also plan to swap their debt for equity shares and become the company's largest shareholder so that they can proceed with restructuring and selling it off.

The creditors' approach is in sharp contrast to the goals of the Hynix board of directors. It wants to redesign the company, turn it around, and make it a success. Micron Technology last week withdrew from talks to buy Hynix and create the world's largest memory chip maker two days after the Hynix board rejected the sale. It is struggling with a mountain of liabilities worth $6.7 billion.

In Singapore, the government is trying to create a more competitive economy. It has unveiled a budget containing rate cuts in corporate and personal taxes and a commitment to make further cuts by 2005. The budget also calls for a hike in the goods-and-services tax from three-percent to five-percent, as of next January.

The aim, analysts say, is to keep international businesses which are now based in Singapore as well as to attract new companies. In the past year, some global firms have shifted operations to Hong Kong so that they can be closer to their manufacturing bases in mainland China.

Tax cuts are also on the mind of the Japanese government. Economic and Fiscal Policy Minister Heizo Takenaka says tax cuts are needed to revive the nation's economy. and that the government should reduce expenditures and return the saved money (to the public and business sector) as tax cuts.

Japanese officials are divided on whether cutting taxes and public spending or issuing more bonds to boost expenditure will help the troubled economy, now in its third and worst recession in a decade.

On the trade front, Japan has banned meat imports from South Korea after authorities in Seoul confirmed an outbreak of highly contagious foot-and-mouth disease.

South Korean officials say they have slaughtered thousands of animals and started a major disinfecting campaign, but Tokyo says it will not import meat from South Korea until its safety is confirmed. The decision comes just one week after Tokyo lifted a two-year ban on South Korean pork imposed after an earlier outbreak of the disease.