#91 It was a great help. At my words that I would take over Jungwoo Group, Prosecutor General Yoon just laughed heartily.
“You... you know that you can't take over a major corporation just because you have a lot of money, don't you?”
“Yes. I know. But if not now, when our economic sovereignty has been handed over to the IMF, there will be no other chance.”
The conglomerates were the people who had led our country's economy from the Japanese colonial period to the present. Beyond mere money, the connections they had built over time and the relationships formed through marriage were intertwined among the conglomerates like a spider's web. Just like the royal families of medieval Europe.
It was difficult to squeeze in among them just by having a lot of money.
“Jungwoo Group, despite being a large corporation, is not a conglomerate. Chairman Park Dae-ho's unique personality is part of it, but it also hasn't been bound by blood relations yet.”
Just because a company is large doesn't automatically make it a conglomerate. Due to the heavy influence from Japan, our country's large corporations had many similarities with Japanese corporations. Of course, in Japan, after World War II, America forcibly tore the conglomerates into more than 100 separate companies.
Our country, obsessed with the task of rapid growth, had its leaders personally create the conglomerates. As time passed, the power of the conglomerates continued to grow. The military regime fell, but the conglomerates survived.
“I understand. Let's give it a try. But you must have the definite support of the media, the IMF, and America. And of course, the tacit approval of the president-elect.”
“Yes, let's set the D-day for the day after the presidential inauguration. A planned article from the media will be released then.”
Prosecutor General Yoon nodded.
“After the prosecution makes its move, foreign capital, including the IMF, will demand the dismantlement of Jungwoo Group.”
For the new incoming government, it was bound to be a burden. It was a demand to tear a Republic of Korea corporation to pieces and hand it over to foreign capital. It was not something they could easily agree to.
However, once the prosecution's investigation results are announced, it will be difficult for the government to hold out any longer. They would probably decide it's better to let Han Gyeong-yeong take over than to be devoured by hyena-like foreign speculative capital.
“The government itself will bring you Jungwoo Group. Your role, Prosecutor General, is crucial. This is all about timing.”
Prosecutor General Yoon did not answer, stroking his chin as if contemplating the repercussions that would come his way.
“It will be a good thing for you too, Prosecutor General. After your term ends, I mean. I will make it so that this can be disguised as your achievement.”
“Is that so?”
“You have to think about what comes after your retirement. You are still too young to return to being a private citizen.”
Prosecutor General Yoon soon nodded and began to ask about the detailed plan.
At that same time, while Kim Mu-hyeok was talking with Prosecutor General Yoon. A car arrived at the hotel where President-elect Kim Hak-kwon's transition team was located. The person getting out of the car was Chairman Park Dae-ho of Jungwoo Group.
“His Excellency is waiting for you.”
“Is he? Lead the way.”
One of Kim Hak-kwon's secretaries escorted Chairman Park Dae-ho to President-elect Kim Hak-kwon on the top floor of the hotel. Kim Hak-kwon, who had been in discussion with his aides, stood up and welcomed Chairman Park Dae-ho as he opened the door and entered.
“Chairman Park, it's been a while.”
“Your Excellency, congratulations on your election.”
“Hahaha. What's with 'Your Excellency'?”
After a warm handshake, they sat down.
“You all may leave. Take all the documents with you. Let's talk about the details next time.”
“Yes, Mr. President-elect.”
Chairman Park Dae-ho saw a list of large corporations among the papers scattered on the table. Of course, Jungwoo Group's name was on it too. After all the aides had left, Kim Hak-kwon and Park Dae-ho began to talk inside the hotel room.
“Look here, Chairman Park. I don't know much about the economy. My aides are up in arms, saying the things the IMF is demanding right now are absurd. What do you think? Is it possible without the IMF's help?”
President-elect Kim Hak-kwon furrowed his brow as if his head was throbbing and rubbed his temples with his fingers. Park Dae-ho nodded.
“You will have to follow the IMF's demands. There is a saying, 'global village.' A country can never survive if it becomes isolated. Even if you refuse, you might be able to overcome the current crisis after a long time.”
“Hmm...”
“But what will you do after overcoming it? If you tear up the agreement made with the IMF, what will the Republic of Korea be able to do on the international stage again?”
“My aides are talking about a default.”
“Absolutely not. We are not a country in Africa; we are the 11th largest economy in the world. To even speak of a default...”
President-elect Kim Hak-kwon looked at Chairman Park Dae-ho with a puzzled expression. Chairman Park Dae-ho showed a particularly strong reaction to the word 'default'.
“A country declaring a default is completely different from a person going bankrupt. If faith in the country is broken, who would invest in the Republic of Korea? It's something that can never happen.”
“Hahaha.”
“The economic aides are saying that because they don't know the reality on the ground. Businessmen like myself who manage things directly in the field will all be against it.”
Kim Hak-kwon, who had let out a hollow laugh, sighed deeply.
“Then what should I do? Do you mean I have to hand over our economic sovereignty to the IMF just like this?”
“There is no other way but to accept their demands and pay back the money we received from the IMF as quickly as possible.”
“I've received reports that companies are going bankrupt one after another. Not just large corporations, but I hear hundreds of small and medium-sized enterprises are closing down every day.”
After becoming the president-elect, Kim Hak-kwon received a lot of data from the current government. It was the moment he learned the reality of the Republic of Korea, something he hadn't known accurately as a candidate.
“Our foreign exchange reserves are at rock bottom. We have to pay back the money, but we don't have any. How did our country end up like this...”
“This is all the doing of countries like Japan and America. The problem with liquidity arose when they simultaneously pulled out the funds they had invested in the country all at once.”
“Hmm...”
Park Dae-ho said in a slightly agitated voice.
“Japan, in particular, is what triggered this situation. Forty percent of our country's debt was to Japan. Their cold refusal of our request for help was a huge factor. It is the current government's mistake.”
“That may be so, but...”
“You must not be bound by the past and forsake the present. I too resent what Japan did to the Republic of Korea. But it is a country that is both far and near. Japan is a nation inseparable from us. You must create an atmosphere of reconciliation and make them invest in our country.”
Chairman Park Dae-ho's words were true. Kim Hak-kwon also knew that if the Japanese government had accepted the Republic of Korea's request, they would not be receiving these humiliating demands from the IMF.
“Hoo... I understand. I will stop by Japan after my visit to America. I have to get their investment.”
“An excellent decision, Your Excellency.”
“I told you to stop with the 'Your Excellency'. You, of all people, who know what I went through under the military regime?”
“Yes, Mr. President.”
“How is Jungwoo Group?”
“We are solid. Weren't we the first to call for globalization and invest in various places, including Eastern Europe? There are no major problems.”
“Are you sure? What my aides are saying is different.”
Park Dae-ho laughed, feigning composure.
“Hahaha. That's just talk from scholars who don't know the real world. There is no such thing as a business without debt. It's just a short-term liquidity problem; we can cover it all soon.”
Kim Hak-kwon nodded at his words. Park Dae-ho subtly changed the subject as he asked.
“I heard a rumor that you will soon be holding a gold-collecting campaign for the citizens. Is that true?”
“Hah, where did you hear that?”
“The rumor is already widespread in the business world.”
“Hahaha, they say the bureaucrats are the trumpets of the conglomerates. I see it's true.”
Kim Hak-kwon gazed at Park Dae-ho, who was smiling as if he knew nothing, and then sighed.
“I have to collect gold and sell it. No one wants to take our country's currency, but they will buy gold.”
“Our Jungwoo Group will step forward for that.”
“Jungwoo Group?”
“Yes. We will not take any profit. Our Jungwoo will take the lead in exporting gold to bring in dollars.”
Seeing Kim Hak-kwon look slightly tempted, Park Dae-ho passionately added.
“The branches of Jungwoo Trading Corporation are all over the world. We can sell the gold at a good price. Wasn't I originally a trading company man?”
“That's right. Your heroic tales are famous. There was even a rumor that you went to the North Pole and sold ice.”
Trading corporations were the primary contributors to the Republic of Korea's growth. Among them, Jungwoo Trading Corporation was known as a legend in the country.
“Are you saying you'll do it even without any profit?”
“Is this not a national crisis for our homeland? Large corporations like mine must also help.”
“Haha. If only all the other large corporations were like you.”
“The bankruptcies of large corporations will continue. That is, if there is no injection of public funds. The problem is the lack of dollars.”
“I heard Chairman Cheon's doorstep is worn out from all the visitors. Have you been there too?”
“Do you mean Chairman Cheon Tae-san?”
Kim Hak-kwon nodded.
“I have heard the rumors too. However, we are not so desperate as to resort to private loans.”
“Still, it's true that he has a lot of dollars. It just goes to show how desperate the large corporations are.”
“Our Jungwoo is fine, Mr. President.”
“Then that's a relief. Alright. You'll be in charge of the gold collected from the gold-collecting campaign. In return for not taking a profit, I will give you tax benefits. Can you take responsibility and sell it well?”
“Yes, Mr. President. I will absolutely not disappoint you.”
“As soon as the money comes in from the IMF, I'll make sure the large corporations can put out their most urgent fires. You wait too. We can't let the large corporations fall.”
“Thank you, Mr. President.”
Chairman Park got everything he wanted from his meeting with Kim Hak-kwon. The promise of public funds and the right to sell the gold collected from the gold-collecting campaign. President-elect Kim Hak-kwon did not yet realize just how foolish a choice this was.
A few days passed after the meeting with Prosecutor General Yoon. The new year of 1998 was dawning.
“Grandfather. Please stay healthy in the new year.”
“Hoho. Of course.”
For a month, Grandfather met with many chairmen of large corporations. It must have been tiring, but his face was full of life, showing that he was truly a man of action.
“I've lent out everything except for the dollars in the basement. Most of the top 20 groups, including Daehyun Group and of course Ilseong Group, borrowed money.”
“What were the conditions?”
“Convertible bonds. What else can people with no money do? Ilseong's was for its electronics, Daehyun's for its automotive, and Geumseong's for its semiconductors.”
I nodded. Grandfather added.
“Most of what you talked about went through, so get the documents from Myeong-hun later. You can convert them to stock starting in one year. The maturity is ten years.”
Grandfather was truly amazing. Although I was the one who asked, he had managed to get more than I had wanted through negotiations.
“Ah. Besides the convertible bonds, I also took shares of their various affiliate companies as collateral, but is there really a reason for this? Collateral is just collateral. As long as they don't go bankrupt, that is.”
Just as Grandfather said, the affiliate shares held as collateral didn't mean much. Because unless they were crazy, they would never give up their stocks instead of paying back the money. However, it was a different story when considering the peculiar circular shareholding structure of our country's conglomerates.
I intended to use the collateralized shares to restrict their voting rights through lawsuits.
“Grandfather. Thank you. It was a great help.”
“Hoho. It was fun, it's been a while. The chairmen of the large corporations were so restless, watching my every move like their feet were on fire.”
Putting aside the 2,000-won exchange rate, the reality was that dollars themselves were hard to come by. They urgently needed dollars for payments, but Grandfather was the only one who could release them.
“How was Chairman Song?”
“Hoho. Do you think that man would act servile towards me? I lent him the money out of old-time's sake, but he's a boring fellow.”
Chairman Song was in a much better situation than the other companies. The liquidity crisis was unavoidable, but thanks to his bet on Kim Hak-kwon, he was guaranteed priority for public funds, so he would be able to hold on.
“It seems he's thinking of jumping into the race to acquire Asin Motors. He's the type of person to think about growing his company even in a situation like this.”
I had tried to stop him, but Chairman Song ultimately revealed his intention to participate in the acquisition of Asin Motors. From Ilseong and Daehyun to Jungwoo, everyone from the first to the third-ranked conglomerates was eyeing Asin Motors.
“The company that takes over Asin will face the winner's curse. Now is not the time to grow a company...”
< It was a great help. > End