On this day, December 19 in the year 1936, Kim Woo-Choong was born in Daegu, South Korea. He was a former employee of a small textile trading company before he founded the Daewoo Group – one of the biggest business conglomerates in South Korea in the 1990s. As a child, he delivered newspaper to earn money to help his family which for a time was in financial problems.
Then his father was appointed as a mentor to the military officer-turned-president Park Chung-Hee. With a better family standing, Kim was enrolled at the prestigious Kyunggi High School and later at Yonsei University in Seoul where he finished a course in economics.
With great enthusiasm for entrepreneurship and using his father’s connection to the Park Chung-Hee government, Kim borrowed US$10,000 to put up his own trading firm which he called Daewoo, meaning “great spreading out” in Korean. In tandem with the so-called Korean economic miracle in the 1960s to 1990s, the Daewoo group achieved a remarkable growth that enabled it to become top-4 or top-5 Chaebol – the term for big business groups in the country.
The growth of the Daewoo group was financed primarily with loans guaranteed by the government. Kim bought losing companies and encouraged by the government, turned these companies around through exports. He also went around the world to establish offices and subsidiaries in farflung areas including Africa. Thus, Kim was able to build-up a reputation for business savvy. He was celebrated as a hero for his contribution to the country’s economic development. It was said that even kids could recognize his face.
Then came the great Asian Economic Crisis in 1997 that started in Thailand. Companies that were heavily indebted ran out of cash and were ruined. Many Korean companies went bankrupt. The government encouraged the Chaebols to restructure and sell unrelated subsidiaries. But Kim was adamant. He went on to pile more debt for expansion. When the government stopped its support, it was already too late for Daewoo. Even after selling a large number of subsidiaries, the banks foreclosed and Daewoo Group quickly became a thing of the past.
Subsequently, Kim went to live in exile abroad and when he returned, he was arrested and later imprisoned on charges including fraud and embezzlement. In 2007, then President Roh Moo-hyun pardoned him