The rapid rise of the South Korean economy to rich world status is a case study in universities across the world. But not too long ago, the country had to be bailed out by IMF after the 1997 Asian financial crisis, thanks to excessive foreign debt by its corporates amidst a plunging currency. This article shows how ordinary Korean households did their bit by donating their personal gold holdings to the Korean central bank to help with the bailout.
“The total gold collected across the four-month campaign reached approximately 227 metric tonnes — worth approximately $2.13 billion at contemporary market prices — and the total number of participants reached approximately 3.51 million, representing approximately 23 percent of all Korean households in the country. The Bank of Korea’s gold holdings, which had been substantially depleted across the prior years, increased by approximately ten to twenty times over the four-month campaign period.”
What did they donate? “…newlyweds donated their wedding rings. Parents donated the dol-banji — the traditional 24-karat gold rings given to Korean children on their first birthdays as symbols of family blessing and material security. War veterans donated their military insignias. Olympic gold medallists donated their medals. Elderly Koreans donated the gold gifts they had received from their adult children over decades. Cardinal Stephen Kim Sou-hwan — the first Catholic cardinal in Korean history and one of the most widely respected public figures in the country — donated the gold pectoral cross he had received at his appointment as cardinal in 1969”
Whilst it wasn’t strictly a donation given the ‘donors’ received compensation, albeit below market, it does show the aspect of ‘collective sacrifice’ for a national cause embedded in Korean culture:
“The historical precedent that both campaigns explicitly invoked was the National Debt Redemption Movement of 1907, when the Korean Empire owed Japan approximately 13 million won in imperial debt (approximately one year’s national budget), and when ordinary Korean citizens — Korean women selling wedding jewelry, Korean men foregoing tobacco and alcohol, Korean children donating pocket money — had attempted to raise the funds to prevent Japan from using the debt as a pretext for further encroachment on Korean sovereignty. The 1907 campaign had ultimately failed to prevent the 1910 Japanese annexation of Korea. Its cultural memory, however, had remained substantially available to the Korean population 91 years later as a template for civic mobilisation in a national emergency.”
Whilst the reforms imposed by IMF drove much of Korea’s rise to a global economic and soft power, the sacrifice of ordinary Koreans is not forgotten: “…an IMF official told KBS during a subsequent interview that he had never observed comparable citizen mobilisation in any of the other countries the IMF had bailed out across its 50-year institutional history. Korea repaid its $58 billion IMF loan in full by August 2001 — approximately three years ahead of the original repayment schedule. The subsequent two decades of Korean economic performance included Samsung Electronics’ rise to global memory chip dominance, BTS’s 2013 debut and subsequent contribution of approximately $50 billion to Korean GDP across the following decade, the expansion of Korean cultural exports through the broader “Korean Wave” (Hallyu), and the more recent per-capita GDP increases that have positioned Korea among the more prosperous economies in East Asia.
The 3.5 million Korean citizens who, on the mornings of the first weeks of January 1998, lined up outside their local Housing Bank and Nonghyup branches with their wedding rings and their children’s first-birthday gold — anticipating no direct compensation beyond the below-market won they would receive for the exchange, motivated by a national circumstance that essentially every one of them understood to be humiliating and possibly permanent — remain, in the collective memory of contemporary South Korea, one of the more substantial demonstrations of what the historical accumulation of a specific national character can, under sufficient stress, produce. The Korean cultural memory of the 1997-98 gold collection movement is, in essential respects, one of the reasons the country’s subsequent economic and cultural trajectory has been what it has.
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