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CH295 | GSI
🕑 Added 2025-08-27 10:00:18 +0000 UTCA few days later
A large black Mercedes sedan carrying Seok-won glided to a smooth stop in front of the main gate of the family home in Hannam-dong.
Assistant Manager Han Ji-sung stepped out first and promptly opened the rear door. Seok-won extended his long legs and emerged from the back seat.
It was already mid-August, and the summer heat should’ve begun to ease. But the record-breaking heatwave made it so hot that just standing still brought out a sweat.
As Seok-won began walking toward the gate, Han Ji-sung quickly jogged ahead, pressing the intercom button attached to one of the gate pillars.
“Master Seok-won has arrived.”
With a sharp beep, the iron gate’s lock released.
They entered the high-walled property, and as Seok-won crossed the neatly manicured garden toward the main house with Han Ji-sung in tow, a family of calico cats emerged from the shrubbery, meowing.
Even though it had only been a few weeks since he last saw them, the cats—Pony and her kittens—came right up to him, tails held high, brushing affectionately against his legs one after the other.
A smile crept across Seok-won's face as he bent down to pet them.
"You guys… Your fur is looking all shiny. Must’ve been eating well, huh?"
Just then, the only male in the bunch, a mackerel tabby named Makdung, tapped Seok-won’s leg with his paw as if to ask, Did you bring anything tasty?
"Ah, I forgot to bring snacks today. But I’ll bring you a whole bunch of Churu next time, okay?"
"Meow."
Makdung let out a meow, tilting his head up to look at him, as if to say, Got it.
"Hah. Are you seriously answering like you understand me?"
"Nyaa~"
The kitten’s enthusiastic responses made Seok-won chuckle.
After playing with the cat family for a bit, he continued toward the house.
"You’re here," said Madam Jo Deok-rye, who greeted her son warmly in her house dress, waiting at the entrance as she always did.
"Welcome back, sir," added Mrs. Gunsan with a smile, bowing politely, apron still on.
"You look even younger than the last time I saw you, mother," Seok-won teased.
"What nonsense is this?"
Jo Deok-rye shook her head, half in disbelief at her son’s cheeky flattery.
“You’ve gotten bolder with age, haven’t you?”
Still, it was clear from her expression that she didn’t mind at all. Seok-won burst out laughing.
“Haha, you’ve been well, I hope?”
“There’s only the two of you, and with both kids out of the house, it gets a little lonely.”
“Want me to move back in?”
At Seok-won’s cheeky reply, Madam Jo Deok-rye waved a hand and rolled her eyes.
“Don’t say things you don’t mean. Just go on in. Your father and brother are in the study—go say hello first.”
“Yes, ma’am.”
After slipping off his shoes, Seok-won entered the house and made his way to the study alone.
He gave a light knock and opened the solid wood door to find Chairman Park Tae-hong, dressed casually, sitting on a leather sofa with his eldest son, Park Jin-hyung, President of Daeheung Textiles.
Chairman Park, seated in the central seat of honor, glanced at Seok-won and motioned for him to come in.
“Come on in.”
“I came as quickly as I could, but I guess I’m still the last one here.”
Seok-won apologized and took the empty seat to the right.
“You’re the one who asked to meet, so what’s the deal with showing up late?”
Park Jin-hyung playfully scolded Seok-won from across the room, and Seok-won responded with a grin.
“I said I was sorry.”
Unlike many chaebol families torn apart by succession fights, the Park brothers got along well. Seeing this, Chairman Park smiled faintly before his expression turned serious.
“Don’t be too hard on him. If he hadn’t called us together, we wouldn’t even be seeing each other like this.”
“You’re right.”
Chairman Park gave a small nod, then looked directly at Seok-won.
“Did you hear that Chairman Woo is putting Donghae Medical up for sale?”
Donghae Medical was a company that manufactured disposable medical supplies like syringes. Alongside finance, it had been one of the core subsidiaries Chairman Woo Yong-gap had been grooming as part of the group’s future strategy.
But Seok-won already knew of the sale, thanks to his connection with Lee Chul-gyun. His face remained composed.
“I suppose it’s the price of pursuing a reckless hostile takeover.”
“Exactly. He got greedy for something that wasn’t his and now has to sell off what he already owned. That’s karma. When Gil told me, I felt like a ten-year-old weight had been lifted off my chest.”
Chairman Park’s voice brimmed with satisfaction.
It wasn’t surprising—Chairman Woo and Donghae Group had built up plenty of bad blood with the Parks, especially after trying to take over the very group the elder Park had founded. The resentment ran deep.
Park Jin-hyung also chimed in, clearly pleased.
“The financial authorities are wrapping up their investigation into Donghae Mutual Credit Union and Donghae Peregrine Securities over those illegal loans. Word is they’re going to face some heavy penalties.”
“Hmph. Serves them right.”
There were even rumors that, on top of the current probe, Donghae Peregrine Securities might be forced to end its joint venture with the Hong Kong-based Peregrine firm.
They had to give up their precious new building site in Seocho because of the bonds Peregrine dumped on me. I’m sure they’re grinding their teeth about it. No way that partnership’s going to survive this.
It was also possible that the real reason for the Donghae Medical sale was to buy back the shares held by Hong Kong Peregrine—meaning they needed the cash.
Chairman Park took a sip of coffee from the cup in front of him, then turned to his eldest son.
“By the way, didn’t you say they’re offering more tax breaks if we restart Phase 2 construction of the Shenyang Plant No. 2, which had stalled due to wage stagnation?”
“Yes. They’re offering a full exemption on the taxes for the materials and machinery needed for construction, up from the previous 50% reduction.”
“Wouldn’t that save us millions on construction costs?” Chairman Park Tae-hong asked, clearly intrigued.
“Yes. I think the Chinese central government is pushing local officials hard on economic performance indicators, like growth rates. That’s probably why they’re offering additional incentives to get construction going again.”
“Now that the situation with the Mido Department Store has more or less settled, we were already thinking of resuming construction soon anyway. If there’s an extra benefit to doing it early, it might not be a bad idea. What do you think?”
“I agree.”
At that, Seok-won—who had been quietly listening—cut in unexpectedly.
“I think we should reconsider.”
Because he usually stayed out of Daehung Textile’s business—managed by his older brother—Seok-won’s comment caught Chairman Park off guard. His brow furrowed slightly.
“What do you mean?”
Park Jin-hyung also turned toward his younger brother with a puzzled look.
The topic was tied to something Seok-won had been meaning to discuss today, so he met their eyes and spoke with a serious tone.
“We may have won the fight against Donghae Group, but we had to stretch ourselves thin to block that hostile takeover. I think now’s the time to focus on consolidating and minimizing expenditures.”
“Hmm. I see where you’re going with this.”
Chairman Park leaned back against the sofa.
“But business is all about timing. It’s a project we’ll have to complete eventually, so wouldn’t it be better to move forward while the local government is offering us extra benefits?”
Park Jin-hyung nodded in agreement.
“Liaoning Province, which is even farther north than North Korea, gets brutally cold in the winter. If we don’t restart construction now, we’ll have to wait until at least next spring. That delay would increase costs significantly.”
From the look on his face, it was clear he had already made up his mind.
“Most of the company’s spare funds were pulled into defending the management rights, so I assume Daehung Textile doesn’t have much cash left. How are you planning to finance the construction?”
“We’ve got incoming export payments from yarn shipments scheduled for the second half of the year. If we use that as collateral for an export loan, we should be able to cover the costs.”
They clearly already had a financing plan, but Seok-won leaned forward, unconvinced.
“If you’re relying on incoming export dollars to fund this, then that’s exactly why you shouldn’t restart construction.”
At his stronger opposition, Chairman Park’s expression turned serious. He sensed something deeper at play.
“You’d better explain clearly why you think we shouldn’t.”
Park Jin-hyung also furrowed his brow, waiting for an answer.
Feeling both eyes on him, Seok-won calmly collected his thoughts and began.
“I’m sure you’ve seen the Bank of Korea’s report. The current account deficit for the first half of the year reached $11.66 billion.”
“……”
“That’s a 79.4% increase compared to the $6.5 billion deficit during the same period last year. On top of that, the price of DRAM, which was $15 to $17 per unit earlier this year, has dropped by $2 to $3. The deficit is only going to get worse.”
Facing both who were quietly listening, Seok-won continued.
“Exports are slowing rapidly, yet imports of raw materials and factory equipment have actually increased compared to last year—widening the trade deficit even more.”
Despite the drastic shifts in the global economy, many domestic companies still clung to the optimistic notion that just because exports had gone well in the past, they would continue to do so in the future. Seok-won couldn’t help but feel disappointed by such complacency.
“It would be fine if exports bounced back. But the problem is that, with the yen weakening due to the reverse Plaza Accord, Japanese products have gained a competitive edge. That makes it much harder for Korean exports to grow like they used to. This inevitably leads to over-investment, mounting debt, and bloated inventories, all of which will put enormous pressure on companies and further worsen an already weakening economy.”
Chairman Park Tae-hong and President Park Jin-hyung both looked grim, clearly sensing how serious the situation was.
If the domestic economy were to slow down, it would directly impact Mido Department Store—the group's cash cow—by dragging down its sales as well.
“On top of all that, there’s one more looming risk that will hurt not only Korea but also other export-driven Asian economies like Taiwan.”
“What is it?”
“Starting March of the year after next, Japanese banks will be required to raise their BIS capital adequacy ratio to 10%.”
The BIS capital adequacy ratio refers to the minimum capital banks must hold, as recommended by the Bank for International Settlements (BIS), to guard against financial risk.
“Why is that such a big problem?”
Park Jin-hyung tilted his head, confused.
“After the bubble burst, Japan introduced an ultra-low interest rate policy, which caused a flood of yen to pour out of Japan into foreign markets.”
“Right, I remember that.”
Park Jin-hyung nodded.
“You’ve probably also heard of the so-called yen carry trade—borrowing yen at low interest rates and investing it in high-growth emerging markets to earn returns.”
The enormous amount of yen flowing out of Japan played a significant role in inflating economic bubbles across Asia.
“But now those Japanese banks, after having scattered all that yen abroad, are suddenly being told they need to raise their capital ratio to 10%. What do you think they’ll do?”
“Hmm...”
Realizing the implication, Park Jin-hyung let out a low hum.
“They’ll try to pull back a huge amount of their overseas loans.”
“Exactly. We don’t know the exact figure, but it’s safe to say a large chunk of that yen carry trade money ended up in Korea. If even a third—or half—of it gets pulled out all at once, domestic liquidity will dry up fast.”
Chairman Park Tae-hong, who had been quietly listening to his sons’ exchange, now wore a deeply troubled expression.
And Seok-won didn’t stop there—his tone grew even more urgent.
“Now consider the ongoing current account deficit, where more dollars are flowing out than coming in. If this continues, we could be looking at a full-blown foreign exchange crisis.”
The shocking prediction made both men’s eyes widen as they stared at him in disbelief.
