I feel like Forrest Gump, a barometer of Asian Armageddon. I’ve come to South Korea via Sri Lanka, where the triumphant Rajapakse brothers were parading the bullet-ridden body of Tamil Tiger leader Prabhakaran on state television to the tune of Star Wars. And now that I’m comfortably billeted in Seoul’s Hotel Shilla, preferred hostelry of Korea’s old-monied corporate clans, local media report that the former president Roh Moo-hyun has just killed himself and mad Kim up north is threatening to irradiate us all in an insane endgame of nuclear brinkmanship. Have I dodged suicide bombers in Sri Lanka only to meet my maker in the last episode of the Cold War?
I’m here to see how they’re dealing with the GEC — that’s global economic crisis. Just fine, as it happens, but another alarming acronym has Korea-watchers a-twitter: ICBMs, the ones Kim Jong-il is pointing across the troubled peninsula and beyond, to Japan and the US. Desperate Kim behaves like a baby throwing toys out of his pram, and the rest of us placate him by throwing money — until the next tantrum, and the one after that. The threats are more serious this time but South Koreans seem to be reacting with admirable sanguinity. Stock and currency markets briefly tottered, commuters grabbed the news on smartphones en route to the office, but they woke the next day to discover that they were all still here, and capitalism proceeded apace.
As for the financial crisis, the Land of Morning Calm is reacting with, well, morning calm. ‘We wake up and get the bad news from New York and London but it’s OK, we had our big crisis in 1998,’ explains HSBC’s Changsoo Lee, ‘so we’ve been well prepared for this one.’ Indeed, remarkably for an export-driven economy — witness the Samsung and LG gadgets and Hyundai and Kia cars in almost everyone’s households everywhere — South Korea is yet to slip into recession, which is more than Japan, Singapore and Taiwan can boast.
More remarkably, if not a little disturbingly, Seoul’s bankers are now launching local versions of the very products that got the rest of us into this global financial kimchee: securitised mortgages. Kookmin Bank has just launched a $1 billion bond anchored by about 30,000 Korean mortgages. But far from the fully leveraged ‘Deadbeat Dad’ loans packaged into America’s subprime nightmare, few Korean homeowners owe more than 50 per cent of the value of their homes — I’m told the state doesn’t allow it, a regulation instituted after the 1998 crisis. The Kookmin facility was six times oversubscribed and 55 per cent of it was taken up by Asian investors; further evidence, if any were needed besides China’s massive continued flotation of the US economy, that the future indeed tilts eastwards.
A friend here told me that Seoul had become ‘very groovy’ in recent years. ‘Lots of jazz places and cool bars have sprung up,’ he reckons, so I asked a lass at the Shilla reception if she could recommend a club. She said there was a ‘soul club’ near the hotel, and it sounded promising. I was imagining finger-snapping Korean beatniks, local versions of Marvin Gaye and Gladys Knight. Maybe Stevie Wonder was in town. I set off hopefully, in cool metropolitan black, for a look-see, only to discover that far from being a grungy Motown of the East, the Seoul Club was a rather smart conservative businessmen’s domain, one of those cultural halfway houses that connect expatriate bankers with the local establishment over tennis and cigars.
The last time I was on this peninsula, I was the other side of the Demilitarized Zone. As we know from the grotesque treatment of American reporters Laura Ling and Euna Lee, recently sentenced to 12 years hard labour, journalists are mostly banned from the Stalinist-and-then-some north. But I once managed to bluff a week’s visa under the guise of being a ‘golf course developer’. Wacky, yes, but more inventive than the covers I’d employed for other countries that didn’t much like foreign hacks — such as Burma, which I’d entered as a ‘pasta salesman’. And it brought the bonus of enabling me to play North Korea’s only golf course, where I asked the manager if he’d ever had the honour of welcoming Dear Leader Kim Jong-il to his links. Oh yes indeed, the manager said, and what a golfer he was, going round in 34 with five holes-in-one and no hole worse than a birdie. That’s about 20 strokes under the world record for 18 holes. So the solution to North Korea’s economic woes isn’t to threaten nuclear mayhem but to launch the Dear Leader on the pro tour, where he’ll surely walk away with a fortune.
For all Seoul’s thrusting commerce and feisty independence, you need only turn on the telly to see who secures it all. North Korea’s belligerence reminds us that the Pentagon still has more than 20 bases in South Korea and 30,000 troops, many of them crammed into a redoubt called Camp Coiner that occupies 60 acres of prime central Seoul real estate. Coiner’s residents are entertained by the ‘Armed Forces Network’, which offers a bizarre and revealing way for the curious visitor to wile away a few hours. Actual news is disturbingly absent, and broadcasts are punctuated by public service announcements for US military personnel. ‘Pick Up After Your Dog’, ‘Learn Your Host Country Customs — They Will Make You Appreciated’ and ‘Try Something New, Eat Where the Locals Eat’. Illustrated by folksy little skits — one African-American grunt discards his Big Mac in favour of garlicky bulgogi — it’s all designed to win Korean hearts and minds, if the Middle American soldiers can drag themselves away from last night’s Letterman show and beat-’em-up Chuck Norris repeats.
Businessman D.H. Park isn’t too fussed about North Korean confrontation, or financial peril. He reckons the way out of the mess is for everyone to love each other. Park spent a decade in London as a City screen-jockey, ‘making the most incredible bonuses’. Then he returned to Seoul to set up a boutique private-equity fund, IWL Partners, in an office so chic it would impress the most jaded Wallpaper editor. IWL? Hmm, I’m wondering as I chat with him — the initials of his partners? ‘No,’ Park says proudly, ‘Invest With Love.’ And so far he has, showing 50 per cent year-on-year returns in his first three years. Crisis, what crisis? There’s little sign of one in Seoul.