Page "Economy of South Korea" Paragraph 17

For the first half of the 1990s, the South Korean economy continued a stable and strong growth in both private consumption and GDP.

Things changed quickly in 1997 with the Asian Financial crisis.

After several other Asian currencies were attacked by speculators, the Korean Won started to heavily depreciate in October 1997.

The problem was exacerbated by the problem of non-performing loans at many of Korea's merchant banks.

By December 1997, the IMF had approved a USD $ 21 billion loan, that would be part of a USD $ 58. 4 billion bailout plan.

By January 1998, the government had shut down a third of Korea's merchant banks.

Throughout 1998, Korea's economy would continue to shrink quarterly at an average rate of-6. 65 %.

Korean chaebol Daewoo became a casualty of the crisis as it was dismantled by the government in 1999 due to debt problems.

American company General Motors managed to purchase the motors division.

Indian conglomerate Tata Group, purchased the trucks and heavy vehicles division of Daewoo.

Thanks to industrialization GDP per hour worked ( labor output ) more than tripled from US $ 2. 80 in 1963 to US $ 10. 00 in 1989.

More recently the economy stabilized and maintain a growth rate between 4-5 % from 2003 onwards.