Throughout South Koreas cities, former professionals huddle together on footpaths alongside displaced building workers common victims of the hopelessness, despair and rage that comes from being stood down. In this country there is great shame in losing your job. It tears apart families and drives many workers to commit suicide. People are stunned that their countrys rapid rise to riches has had an even more rapid demise.
Late in 1997 an abstract run on the South Korean won triggered a series of financial collapses, the scale of which were magnified by the recklessness of big businesses investing and borrowing. The IMF offered $58 billion in bail-out loans in return for a one-sided overhaul of the highly protected economy.
Manufacturing in South Korea has long been dominated by the chaebol, large conglomerate companies such as Samsung and Hyundai. Four chaebol account for 45 per cent of GNP and around 50 such companies control the entire economy. Bribes from the chaebol have traditionally flowed freely to the military governments, and government subsidies for industry have flowed back; the companies have also benefitted enormously from the severe repression of labor rights. But their inward focus means they have neglected to develop support industries, and that, coupled with endemic corruption, fuelled the economic collapse.
South Koreas economy, traditionally based on agriculture, underwent an extraordinarily rapid industrialization from the 1950s. Gross domestic product expanded by more than nine per cent yearly between the mid-1960s and the early 1990s. Economic aid, especially from the US and Japan, helped South Korea grow in the span of a generation from one of the worlds poorest to a feisty East Asian tiger economy.
The US aid came in the aftermath of the 1950-53 war in which US-led United Nations forces fought against North Korea and its Chinese and Soviet allies. The two Koreas have been technically in a state of war ever since. Their border is the worlds most heavily armed, with two million troops deployed. With China and the US, South Korea recently began talks with the North, but little progress has been made and the threat of nuclear proliferation remains a serious regional concern.
Open participatory government also continues to elude the countrys people. The rapid industrialization was fostered under the autocratic rule of Major-General Park Chung Hee, who came to power in 1961 and was eventually assassinated in 1979.
Major-General Chun Doo Hwan then seized power but his attempts in 1987 to rubber-stamp another general, Roh Tae Woo, as successor sparked massive student-led protests joined by the middle classes. Roh won an election with only 37-per-cent support after Kim Dae Jung and Kim Young Sam split the opposition vote, though his rule was shaken by a wave of strikes for higher wages and democratic rights.
In 1990 Kim Young Sam merged his opposition party with Rohs ruling camp and he was elected the countrys first civilian President in 1992. He led an anti-corruption campaign that put Roh and Chun on trial for bribery. The two former Presidents were charged with mutiny and treason for their roles in the 1979 coup and 1980 Kwangju massacre.
After a lifetime of opposition, the current President, Kim Dae Jung, was elected following the economic crash. But he wants to tighten strike laws and says he will deal sternly with those involved in illegal strikes only the government-dominated Hanguknoh chung labor federation is legally recognized. But union leaders say that the economic crisis and the suppression of workers will only make more people aware of the problems and more hostile towards the Governments response.
South Koreans are no strangers to being colonized or oppressed, and have as a result developed a long history of dissent. Their pain is real and anger is building. South Korea is in few respects the Land of the Morning Calm.
AT A GLANCE
Leader President Kim Dae Jung.
Economy GNP per capita $10,550 (Japan $40,940). But this World Bank figure is from pre-crash 1997. In reality the economy has been mutilated by the current crisis and both production and living standards have tumbled.
Monetary unit: Won.
Main exports: Textiles (18%), electronic goods (16%), machinery (11%) and cars (6%).
Main imports: Machinery and transport equipment, mineral fuels.
People 46 million.
Health Infant mortality 6 per 1,000 (Australia 6 per 1,000). Again, the figure is from 1996: infant-mortality rates will certainly have deteriorated since the crash.
Culture There are no ethnic differences between North and South Koreans. Koreans are an unusually homogeneous group in cultural terms. There are no distinct minorities.
Religion: Buddhism, Confucianism, Christianity and Chondokio.
Previously profiled April 1988
The economic crash will widen the gap between the haves and the have-nots.
Though economists did not read the signs, as long ago as the mid-1980s South Korea was the fourth-most indebted country in the world.
NI star rating
POSITION OF WOMEN
At 98%, the highest in Asia after Japan.
Very low tolerance of difference or dissent; numerous abuses of justice when dealing with protesters. Homosexuals are still largely ostracized.
The democratically elected government is relatively new, and there are still widepread restrictions on free association, union activity and free speech. The chaebol-government nexus also needs to be broken before meaningful democratic advances can be made. Open dialogue needs to be established with the North.
Help us produce more like this
Patreon is a platform that enables us to offer more to our readership. With a new podcast, eBooks, tote bags and magazine subscriptions on offer, as well as early access to video and articles, we’re very excited about our Patreon! If you’re not on board yet then check it out here.