[FOUNTAIN]Treaty formed foundation of core industry

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[FOUNTAIN]Treaty formed foundation of core industry

“The first step of industrialization is the self reliance of agriculture. Now that foreign banks won’t issue loans, wouldn’t it be a reckless decision to push for construction of an iron mill?”
In 1969, POSCO president Park Tae-joon heard that comment in Tokyo while arranging financing for construction of an iron mill. The comment came from the Japanese Minister of Economy, Trade and Industry. From the point of an existing top iron producer, it might have seemed a vain ambition for poverty-ridden Korea to want to produce iron instead of rice. However, humiliation could not make Mr. Park go back to Korea.
In the Korea-Japan normalization talks, the two nations had already agreed to use reparation payments to develop the agricultural, forestry and maritime industries. Mr. Park was working to win the consent of the Japanese government to divert money to POSCO. The Japanese cabinet is based on unanimity, and the government cannot make a decision if even a single cabinet member opposes. In order to persuade the Minister of Economy, Trade and Industry, Mr. Park visited him three times in a week.
In the end, the businesslike minister said, “I have never seen a more stubborn man,” and agreed to let reparation funds be used for POSCO.
After such a humble beginning, POSCO has emerged as the most competitive steelmaker in the world in just over three decades. It has surpassed Japanese steelmakers, from which it had learned the trade. Humiliation has been transformed to glory. In 1981, the Japanese daily Yomiuri Shimbun ran an article saying Korea was threatening Japan’s top status in the steel industry.
“The Korean steel industry grew thanks to the technical partnership with Japan, but now Korean steelmakers are encroaching on the Japanese market. Imports from Korea are expected to exceed one million tons in standard steel materials alone. Korean products make up 80 percent of Japan’s total standard steel material import.”
When survival is more desperate than pride, you have to endure the disgrace. Four decades ago, the Korea-Japan normalization treaty was a shameful choice. However, the Republic of Korea used the payments to become one of the top 10 economies in the world. Maybe there is no reason to remember the treaty as disgraceful.


by Chun Young-gi

The writer is a deputy political news editor of the JoongAng Ilbo.

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