By Park Hyong-ki
Kang Bong-kyun, former finance minister, passed away on January 31, 2017. He was 74.
Not many young people might remember him. But for those who lived through and experienced the difficult times of the Asian financial crisis in the late 1990s, Kang would be most remembered then as the country’s top fiscal policymaker.
Faced with the biggest economic crisis in the country when the value of the won depreciated beyond 2,200 won and the governance of family-run conglomerates were at their worst, Kang was appointed as the finance minister to fix the broken system.
Under heavy debt and scrutiny from the global financial community including the International Monetary Fund (IMF), which exercised harsh conditions on Korea in exchange for providing bailout funds, it was highly likely that Kang did not want the job. No economic bureaucrats or politicians did, other than pointing fingers at one another and playing the blame game.
Kang, nevertheless, took the helm as former President Kim Dae-jung’s finance minister, trying to reform the economy by correcting malpractices of chaebol and the banking sector’s reckless borrowing and lending.
New and harsh regulations were set up during this period with the aim of mitigating the so-called Korea Discount against Korea Inc. Higher standards of financial accounting were established against listed and privately-held conglomerates under Kang’s policy direction.
He was and has been recognized as a key figure who guided the economy through one of the most turbulent and difficult times in the country, setting the stage for the Korean economy to weather the storm.
After serving less than a year as the finance minister, Kang stepped down just as Korea was preparing to pay back its debt to the IMF in August 2001. Kang went off to become the head of the state-run Korea Development Institute.
Korea faced yet another downturn _ the credit card crisis, which former President Kim’s progressive successor Roh Moo-hyun tried to fix with Kang again providing his expertise as a lawmaker affiliated with the ruling Uri Party.
There were some criticisms then in the late 1990s that former President Kim and his economic team tried to overcome the crisis by incautiously promoting credit card spending. This led to more debt trouble later on as the market similarly witnesses today with soaring household borrowing. This is another story.
Despite the endless political blame game, Kang -- may he rest in peace -- will be foremost remembered as a bureaucrat who tried to save the country from the crisis and the IMF shackles when no one else dared to go down the risky path.