hankyoreh

By Kim Jin-cheol

　Company worker Kim Seo-min woke up to the sound of the alarm on his Galaxy S 2, made by Samsung Electronics. He had “Hetban” instant rice and seaweed, made by CJ, for breakfast. Wearing a Rogatis suit, made by Cheil Industries, and with a Hazys coat, made by LG Fashion, draped over his arm, Kim stepped out into the car park holding a can of Lotte “Let‘s Be” coffee. Because of the snow that had been falling all night, Kim he decided to take subway line 9, operated by Hyundai Rotem, to work. The subway was packed with passengers fixated on their smartphones. After wondering for a moment whether to change to fourth generation LG U+ because SK Telecom’s 3G network wasn‘t very fast, he arrived at work. He turned on his computer, made by Samsung Electronics, and began working.

　By the time Kim’s wife, Park Seon-i, had finished cleaning the house with a vacuum cleaner made by LG Electronics, the morning was almost over. Park, who had arranged to meet friends for lunch, started up the Sonata, made by Hyundai Motors, that her husband had left at home. It was almost out of gas. She drove to the local GS Caltex gas station. Park and her friends had lunch at Bibigo, run by CJ Foodville, then carried on chatting at Shinsegae Starbucks. She stopped at E-mart and bought ingredients for dinner, paying with her Hyundai Card. When she got back to the Raemian apartment, built by Samsung C&T, items delivered by Hanjin parcel service were waiting for her.

　Chaebol (large conglomerate) groups are as common to the average individual as the air he or she breathes. Wherever you go, it‘s impossible not to encounter their goods and services. The chaebol, however, are few in number. There are somewhere between 10 and 30. It is impossible to imagine Korea without them.

　Results of analysis by researchers at Wipyeongnyang, an economic reform research institute, show that the total assets of Korea’s 30 largest chaebol last year amounted to 1.4605 quadrillion won. This was almost 300 trillion won more than Korea‘s gross domestic product of 1.172 quadrillion. Their annual sales of 1.134 quadrillion won accounted for 96.7% of GDP. Between 1980 and 2011, the assets of these 30 chaebol grew by a factor of 70, while their sales increased 48-fold. After increasing rapidly in the 1990s, sales of the 30 firms experienced slower growth in the 2000s, then grew again rapidly when the Lee Myung-bak government came to power. The wealth of chaebol heads has become national wealth, and the chaebol-centered social order is solidifying still further.

　Far more serious is the concentration of economic power in the hands of the five largest chaebol: Samsung, Hyundai Motors, SK, LG and Lotte. Results of analysis by Kim Byeong-gwon, deputy director of research institute Saesayeon, these five firms’ sales grew from 49.5% compared to GDP in 2001 to 55.7% in 2010. When related groups that branched off after succession by the second generations of owner families in the 1980s and 1990s are included, the bulk of chaebol becomes out-of-control big. When the greater Samsung Group, comprising Samsung, Shinsegae, CJ and Bokwang; the greater Hyundai Group, which includes Hyundai Motors, Hyundai Department Store, Hyundai Heavy Industries, Sungwoo and Halla; and the greater LG Group, which includes LG, GS, LS and Heesung, are included, the sales of the five largest chaebol as a portion of GDP rose from 59.0% in 2001 to 70.4% in 2010. Effectively, chaebol heads and their families, who comprise less than 0.1% of the population, wield 70% of the country‘s economic power.

　Concentration of wealth is not the end of the matter. Chaebol have quietly built up enormous control in areas such as politics and culture. On the other side are the 99.9% of people that are oppressed by the chaebol. These are the entrepreneurs that can do nothing but watch as their small back street businesses disappear, the small and medium enterprise owners who have lost even their last scraps of work, the consumers who have been robbed by monopolies, oligopolies and price-fixing, and the workers who live daily in fear of restructuring.

　Please direct questions or comments to [englishhani@hani.co.kr]