Golden Spoon Investment Portfolio - Chapter 292

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This chapter was translated by Lunox Novels. To support us and help keep this series going, visit our website: LunoxScans.com
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292. Young, brimming with ambition, and brilliant to boot—truly a talent worth coveting.

The Organization for Economic Cooperation and Development (OECD) was an international organization established for the purposes of economic development, international cooperation, and trade expansion.
As South Korea achieved remarkable economic growth—dubbed the Miracle of the Han River—from the ruins of the Korean War and expanded its trade volume, pressure for OECD membership and market liberalization intensified from the early 1990s onward.
However, the government and political circles, concerned that opening the market would destabilize the vulnerable domestic economy, had repeatedly postponed membership under various pretexts.

‘If the agricultural market opens and cheap foreign farm products flood in like a tidal wave, farmers will suffer tremendous damage—that much is obvious. Politicians who need votes would never welcome such a thing.’

Not only farmers, but companies manufacturing various industrial products, including automobiles, which enjoyed protection through import restrictions and conducted business comfortably in the domestic market, were equally reluctant.
With such complex entanglement of interests, fierce debate over OECD membership had erupted across the political sphere.
Yet when Seok-won, who had thus far offered only safe, unremarkable answers, suddenly opposed it with strong conviction, Kim Jae-chun regarded him with curiosity and asked.

“You said we absolutely must not do it?”
“That’s correct.”

Seok-won met Kim Jae-chun’s gaze directly and answered.
Kim Jae-chun’s interest deepened as he pressed further.

“Then tell me why we cannot.”

Seok-won paused to gather his thoughts, then began explaining earnestly.

“I agree that having progressed from a developing nation to the threshold of an advanced economy, we can no longer postpone OECD membership and market liberalization. Since we achieved economic development through exports, opening Korea’s domestic market does not violate the principle of reciprocity.”

Kim Jae-chun raised his glass to his lips, listening intently.

“And when enterprises lacked sufficient capital and technology, there was a need to protect them within a fence and nurture domestic industries. But now, keeping them as hothouse flowers would bring more harm than benefit. Rather, I believe that pushing companies to engage in unlimited competition with foreign enterprises, rather than allowing them to rest on export restrictions, is the path to elevating them to the next level of growth.”

Woo Chun-il, who had been listening silently, tilted his head in confusion.

“By that logic, shouldn’t you be supporting OECD membership rather than opposing it?”
“Ultimately, I believe market liberalization is something we must pass through for economic institutional advancement. Nevertheless, I say not now because the timing is simply too poor.”

Kim Jae-chun then asked, his arms folded across his chest.

“What do you mean the timing is off?”
“If this were during the period of the three lows boom when the Korean economy was growing rapidly, I might understand. But right now, the economy has completely peaked and is heading downward.”

Kim Jae-chun’s expression showed he wasn’t convinced.

“The Bank of Korea has forecast that this year’s economic growth rate will rise to the 5 percent range, higher than last year. Are you saying the economy is doing poorly?”
“Yes, sir.”

When Seok-won answered with unwavering conviction, Kim Jae-chun’s eyes narrowed.

“Consumer prices have reached 3.8 percent through June, threatening our annual target of 4.5 percent. And the current account deficit continues to worsen due to surging imports—I’m sure you’re both aware of this.”
“….”
“In response, the Bank of Korea has raised the base rate to control inflation, and financial authorities have ordered lending restrictions. Small and medium enterprises, already starved for capital, are beginning to feel the squeeze.”

Seok-won spoke with a grave tone, meeting Kim Jae-chun’s gaze across the table.

“In short, the economy’s fundamental strength is weakening.”

Realizing the severity of the situation, both Kim Jae-chun and Woo Chun-il’s expressions hardened slightly.

“If we join the OECD and open our domestic market under such unfavorable conditions, I believe there’s a significant risk of serious side effects—foreign capital penetrating our markets, mass bankruptcies among small and medium enterprises, and destabilizing inflows of speculative foreign short-term capital.”

In fact, the surge in short-term foreign currency borrowing that directly triggered the IMF currency crisis had already been deregulated before OECD entry, according to the government’s financial liberalization plan.

‘But it’s undeniable that the speculative foreign short-term capital that flooded in with OECD membership drained away like a receding tide when the crisis hit, completely depleting our already insufficient foreign exchange reserves.’

On top of that, short-term foreign debt, which had already swollen significantly in a short period, ballooned even further following OECD entry, becoming unmanageable.

‘Multiple problems unraveled simultaneously to trigger the IMF crisis, but the most fatal factor was the end of the three lows boom, which caused exports to plummet and the current account deficit to continue mounting.’

Simply put, if we earn fewer dollars but spend more, a crisis becomes inevitable.

“What kind of side effects are you referring to?”

Kim Jae-chun asked with a grave expression.

“In the worst case, we could face a currency crisis.”

Both men’s faces registered shock at the mention of a currency crisis.

“I understand your concern for the nation’s economy, but even with our current account deficit, our exports exceeded one hundred twenty billion dollars last year alone. Talk of a foreign exchange crisis seems like an overreaction.”

As Woo Chun-il, the Secretary-General, spoke with a dismissive tone, Kim Jae-chun, the Governor, nodded in agreement.

“Of course, the foreign exchange authorities aren’t fools, so if there are signs of a currency crisis, they’ll take the necessary measures immediately. However, as I mentioned before, if the financial markets are opened without proper safeguards in place, and massive speculative foreign short-term capital flows in, only to suddenly withdraw for some reason, it will be difficult for us to handle that situation at this point.”

Seok-won, who had raised these concerns with a grave expression, continued speaking as his face grew more serious.

“Even a sound company with excellent performance and no financial problems can suddenly face a black-ink bankruptcy if it becomes difficult to secure funds and debt repayment demands exceed its available capital. I’m sure you understand this.”
“….”
“The same applies to nations.”

Kim Jae-chun, the Governor, finished the remaining drink in his glass and asked in a subdued voice.

“So what do you think we should do about this problem?”

Seok-won answered as if he had been waiting for this question.

“I believe that while OECD membership is inevitable, we should postpone it for two to three years, use that time to refine our laws and systems, complete all necessary internal preparations, and then open the markets. That would be the best approach.”

Kim Jae-chun, the Governor, stroked his chin with one hand and thought deeply for a moment before raising his head.

“My, the atmosphere has become far too serious—it’s ruining the taste of the drink. I’ll take your opinion under serious consideration.”

He deliberately spoke in a brighter tone, as if trying to lighten the mood.

“Come now, let’s end this troublesome discussion here and enjoy our drinks.”
“On a fine evening like this, shouldn’t we have some music? Shall I have Madam send in the band?”

Woo Chun-il, the Secretary-General, quickly picked up on the cue and chimed in, and Kim Jae-chun, the Governor, nodded with a smile.

“Ha ha. Yes, let’s do that.”

Though I felt a slight regret that we couldn’t delve deeper into the conversation, I knew that discussing it here wouldn’t solve anything anyway, so I went along with the change of pace.

“Will you be singing ‘Mokpo, the Harbor’ again, the one you performed so passionately last time?”
“Ha ha. You know me well. That’s my signature number. Of course I’ll sing it.”

The three of them, having called Madam over and enjoyed drinks in a warm, convivial atmosphere, finally ended their gathering past midnight.
Kim Jae-chun, pleasantly intoxicated and supported by Madam’s arm as he passed through the grand gate, extended one hand toward Seok-won and spoke.

“Let’s make sure we see each other often from now on.”

Seok-won quickly grasped his hand in return, answering with a smile.

“Yes. Please take care on your way in, Chairman.”
“What are you saying? Didn’t I tell you to be at ease with me?”

At his reproachful tone, Seok-won immediately changed how he addressed him.

“Understood, sir.”

Only then satisfied, Kim Jae-chun climbed into the back seat of the black sedan waiting with Madam’s assistance.
Woo Chun-il, whose face had flushed from the effects of alcohol, stood beside the car and watched him.

“It seems the Chairman has taken quite a liking to you.”
“I’m grateful to hear that.”

Woo Chun-il gave Seok-won’s shoulder a light pat as he spoke.

“Then let’s have a separate conversation later.”
“Yes. I’ll be in touch.”

Woo Chun-il turned his body and raised one hand in farewell before boarding the black sedan after Kim Jae-chun.
As the domestic sedan carrying the two men glided smoothly away, Seok-won watched their receding figures for a moment, lost in thought.
While this meeting wouldn’t be enough to prevent the IMF crisis, he hoped at least to establish some minimum measures to prevent rapid foreign exchange outflows through negotiations with the government and ruling party regarding OECD accession ratification.

“If we could at least reduce the suffering caused by the IMF… but it won’t be easy.”

Muttering to himself with a bitter expression, Seok-won soon turned his body, thanked Madam for her hard work, and got into his car.

Meanwhile, in the car heading to Donggyo-dong after coming out onto the main road, Kim Jae-chun, who had been leaning his body against the plush leather seat, turned his head to look at Woo Chun-il, the secretary-general sitting beside him, and opened his mouth to speak.

“You mean about the possibility of facing a foreign exchange crisis?”
“Yes.”
“While it’s not entirely without basis, I still think the chances of it actually happening are slim, wouldn’t you say?”
“While it’s not entirely without basis, wouldn’t the chances of it actually happening in reality still be quite slim?”

Kim Jae-chun nodded slightly.

“That’s right.”

A foreign exchange crisis—even I had to admit the likelihood of such an event actually occurring seemed almost nonexistent.
Yet Seok-won’s confident demeanor as he emphasized the danger kept nagging at me.
Woo Chun-il, reading my thoughts as befitted a close aide, straightened his slouching posture.

“If you’re concerned, sir, I can ask the professors we’re consulting with to examine whether there’s any real possibility to this claim.”
“That sounds good. Please do so.”

I gazed out at the night streets passing by the car window before suddenly speaking.

“Now that I’ve actually met that fellow Chairman Park’s son, I understand why you praised him so highly.”
“I thought you’d find him impressive, sir.”
“You said he was from Harvard, didn’t you?”
“Yes. He graduated from the Economics Department with excellent grades, I’m told.”
“Young, ambitious, and brilliant to boot—truly a talent worth coveting.”

I smacked my lips appreciatively.

“If he weren’t Chairman Park’s son, I’d recruit him for our party immediately. What a shame.”

Woo Chun-il ventured carefully, gauging my reaction.

“Shall I subtly probe his interest, sir?”

I considered for a moment, then shook my head.

“No. If he gets entangled in politics and we misstep, the Blue House could take a dim view of us, and Daeheung Group could face serious trouble. Let’s leave it as is.”
“Understood, sir.”

As the alcohol took hold, I surrendered to the car’s gentle sway and closed my eyes slightly.

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This chapter was translated by Lunox Novels. To support us and help keep this series going, visit our website: LunoxScans.com
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