I asked Chairman Im Jin-yong to gather business leaders who had been affected by Japan's sanctions.
Executives gathered, from major business organizations like the Federation of Korean Industries (FKI), of course, as well as the Korea Chamber of Comrce and Industry, the Korea International Trade Association, the Korea Federation of Ss, and the Korea Employers Federation, including leaders from both large corporations and Ss.
So even rushed back from overseas. That's how seriously they were taking the situation.
The venue was set for the FKI Hall. Though ostensibly established for Korea's economic growth and corporate developnt, it was a well-known fact among all citizens that the FKI was an organization representing the interests of the chaebols.
The FKI Hall, which I was visiting for the first ti, was large and magnificent. What on earth did they do here to warrant such a massive building?
Following an employee's guidance, I entered the main conference hall.
The hall was already packed with people. Although I had t business leaders occasionally, this was the first ti I'd had such a large-scale eting.
It was amazing that so many prominent business leaders had gathered at my word. Was this how a school principal felt, gathering students on the playground for those seemingly pointless morning assemblies?
The combined market capitalization of the companies gathered here exceeded the GDP of a respectable nation. Seated at the front were CEOs of large corporations whose faces often appeared in the news. Among them, I spotted a few chairn who frequented the prosecutor's office in wheelchairs.
And behind them sat the CEOs of mid-sized and small companies. While their scale was incomparable to the large corporations, Ss were responsible for a significant portion of manufacturing employnt.
If these companies were to close down or suspend operations, the grassroots economy would be shaken to its core.
As this was a conversation among business leaders, the dia and politicians were not separately invited.
The atmosphere wasn't good. Even without them saying it directly, I could tell there was significant dissatisfaction with .
Although I had started things, OTK Company suffered almost no damage.
Due to worsening public opinion in Japan, subscribers to FaceIt and Lost Fantasy had decreased slightly, but it was a negligible amount overall.
There were no direct sanctions either. FaceIt was originally an Arican company, and OTK Gas had recently moved its headquarters to the US. They wouldn't want to provoke Ronald by carelessly ssing with us.
On the other hand, the entire Korean economy, from large corporations to Ss, was hit by a widespread shock. Companies that imported core materials, parts, and machinery from Japan were hit particularly hard.
I stood on the podium and spoke into the microphone.
"Hello, I'm Kang Jin-hoo. Thank you all for gathering here. I'll skip all formal remarks and get straight to the point. I believe everyone is suffering significant damage and hardship due to Japan's sanctions. We need to understand the situation and establish counterasures, so please speak frankly without worrying about anyone."
The microphone first went to the CEOs of small and dium-sized enterprises. At first, they hesitated, looking around, but once one or two started speaking, a torrent of complaints poured out.
"It happened so suddenly, we didn't even have ti to secure inventory."
"Our delivery schedules are about to be disrupted."
"Large corporations might have the funds and capacity to endure, but Ss like us are facing the risk of bankruptcy."
"First China's retaliation, and now Japan's retaliation on top of it – it's killing us."
"Every day feels like walking on thin ice."
"Our employees are very worried that the company might shut down, and work efficiency is dropping."
Although there were differences depending on the company and industry, it was indeed serious.
Now that I had a sufficient grasp of the situation, it was ti to devise counterasures. The Ministry of Trade, Industry and Energy and the Ministry of Ss and Startups were probably working on asures, but as always, it takes ti for the governnt to act.
I looked around at the executives and said, "Ss are the roots and pillars of Korean industry. First, I hope that large corporations, including OTK Company, will contribute funds to support Ss and partner companies facing difficulties."
At my words, the faces of the S CEOs brightened. The expressions of the large corporation CEOs, however, remained indifferent.
"Many of you here have experienced similar situations before."
The older CEOs understood what I was referring to.
There had been a ti before when imports of Japanese materials and parts were blocked. It was during the IMF crisis.
Then, as now, the Korean economy relied on processing trade – importing raw materials, precision machinery, and core components, then assembling and processing them for sale.
But when the foreign exchange crisis hit, the governnt's dollar reserves dried up, and the exchange rate soared daily. Due to the plumting value of the won, the prices of imported materials and parts tripled.
Countless companies went bankrupt, and those that survived had to find ways to stay afloat. The thod they found was technological developnt.
Since they had no money to buy parts from abroad, they had no choice but to make them in Korea. They succeeded in localizing the production of nurous core components, and the technologies developed at that ti beca the driving force for economic recovery and corporate growth.
So why hadn't they done it before?
Naturally, it was because buying them was cheaper. And this is still the case now. Technological developnt takes ti and a lot of money.
"Korean companies also need to engage in their own technological developnt. How long will you rely on foreign countries for core components?"
The world is already globalized and intricately connected. It's neither feasible nor efficient to manufacture all components dostically.
Even if it's unavoidable to live off trade due to a small dostic market, the excessive reliance on Japan, China, and the US for imports and exports is a serious problem.
This is why the entire economy stumbles at the slightest external shock. Talk of diversifying imports and exports has been around for a long ti, but everyone sat on their hands until Japan's sanctions led to severe difficulties.
If we had been sowhat self-sufficient, Japan wouldn't have been able to take such sanction asures.
"Competition is good, but now is the ti for cooperation. If companies in the sa industry band together to develop technology jointly, we can significantly reduce both cost and ti."
Chairman Im Jin-yong said, "Technological developnt might be effective in the long run, but it has no imdiate effect. If Japan's sanctions aren't lifted, it will be difficult to obtain core materials and parts for the next few years."
Other CEOs of large corporations also chid in.
"We are urgently contacting Arican and European companies to replace Japanese parts, but..."
"It's questionable whether they'll negotiate properly now that our existing deals have been cut."
"The unit prices don't match either."
"There are many suppliers playing hardball and offering ridiculous quotes."
If they had negotiated while maintaining existing trade lines, they could have made suppliers compete on price. But now, knowing that the Korean side was desperate, suppliers were trying to charge high prices.
I had a thought on that point as well.
"Instead of individual companies negotiating, I hope we can form a joint response. I will take responsibility and lead. We will mobilize all cards OTK Company can play – autonomous electric vehicles, batteries, TWR, etc. – to support the negotiations of Korean companies."
A murmur spread through the conference hall.
I looked around at the executives and said, "I would like to create a task force for joint developnt and joint negotiation right here, right now. Those who wish to join, please don't feel burdened and raise your hands."
At my words, every single person in the room raised their hand.
***
Not to ntion Japan, South Korea is also a globally recognized economic power. As the conflict between these two intensified, the whole world took notice.
Foreign dia covered it as major news, releasing breaking reports daily. Most experts seed to side with Japan.
The reason was obvious: South Korea relied on Japan for core materials and components, and Japan's economy was larger. If the two fought, South Korea's damage would inevitably be greater.
Reporters gathered at the FKI Hall chatted amongst themselves.
"Reporter Kim, what do you think the outco of this eting will be?"
"Won't they just complain about their difficulties and urge the Korean governnt to co up with asures?"
"It's obvious they'll beg the Japanese governnt to ease the sanctions."
"Well, business organizations prioritize corporate profits, after all."
A short while later, after the eting ended, the FKI Chairman announced the results to the reporters.
"...Large corporations have decided to contribute ergency funds to support Ss facing difficulties. Furthermore, we plan to reduce future dependence on Japanese materials and parts by forming a developnt team for joint developnt of core components and a response team for joint negotiations."
The reporters were stunned as counterasures entirely different from what they had expected were announced. But this was only the beginning.
OTK Company distributed a press release to dostic and international dia, and breaking news imdiately poured out.
[Breaking News: OTK Company Announces Full Suspension of OTK Battery Supply to Japanese Electronics Companies!]
[Seosung SB Notified of OTK Battery Supply Contract Cancellation]
[OTK Company Excludes Japanese Firms from Rosatom's TWR Developnt and Construction! Future Tech Partnerships Also Banned!]
[Kang Jin-hoo: No Intention of Backing Down Until Japanese Governnt Apologizes and Compensates...]
***
The OTK battery, developed by Professor Kim Ho-min, revolutionized not only the automotive industry but also the electronics and energy sectors.
TS Company manufactures large batteries for automobiles, while Seosung SB makes small batteries for electronic devices. These were first installed in Seosung Electronics' high-end smartphones, tablets, and laptops.
Equipped with the OTK battery, usage ti more than doubled, while charging ti was actually reduced. Consur response was overwhelmingly positive, and demand surged.
The remaining supply after Seosung Electronics took its share was preferentially supplied to Arican companies. This included Seosung Electronics' partners and competitors like Npple, MS, and Gooble.
The reason for funneling supply to the US, which had many competitors, was that if the new technology were to undermine the competitiveness of Arican industry, the US would not stand idly by. (That's why large automotive batteries are also supplied first to GM and Ford).
OTK Company and Seosung Group attributed all this to President Ronald's credit, and President Ronald praised both companies in front of his supporters, giving them a thumbs-up.
Seosung SB expanded its factories and increased production, exporting to Japan, China, Europe, and elsewhere. But suddenly, they sent docunts to Japanese electronics companies canceling all supply contracts.
If one party unilaterally terminates a contract, damages or penalties usually occur. However, in the case of the OTK battery, it was the recipient, not the supplier, who was desperate, so the penalties were minimal, and Seosung SB willingly agreed to pay them.
Representatives from Sony, Toshiba, Canon, and others ca to Seosung Group's headquarters. They vehently protested to Chairman Im Jin-yong.
"How could you possibly do this?"
"We've been doing business with Seosung Group for decades!"
"If you unilaterally terminate contracts like this, which company will want to do business with Seosung Group?"
Terminating supply contracts ant losses for both sides, but it wasn't a major problem for Seosung SB. There were plenty of others lining up to receive their supply. Indeed, as soon as rumors of the contract termination with Japanese companies spread, Arican and European companies rushed to place orders.
Actually, the image of unilaterally terminating contracts was more problematic than financial losses like penalties. Therefore, Chairman Im Jin-yong sighed heavily and blad everything on Kang Jin-hoo.
"CEO Kang Jin-hoo has banned the export of OTK batteries to Japan, so what can we do? As you know, Seosung SB only manufactures them under license from OTK Company."
"Seeing as Seosung Group joined the task force led by CEO Kang Jin-hoo, doesn't that an you agreed?"
Chairman Im Jin-yong jumped up, feigning indignation.
"Agreed? We are the ones suffering the most right now! We can't send the batteries we've made to Japan, they're just piling up in warehouses, and now we have to pay penalties. We're incurring enormous losses because of CEO Kang Jin-hoo."
"Then Seosung Group should protest to OTK Company..."
Chairman Im Jin-yong beat his chest as if frustrated.
"It might have been different in the past, but now he doesn't even pretend to listen to . We are also being dragged around by CEO Kang Jin-hoo. It's not just ; all companies are in the sa boat. Which Korean company can stand up to OTK Company right now? I'm going crazy too."
Chairman Im Jin-yong vehently denounced Kang Jin-hoo along with the Japanese representatives, as if he and Seosung Group were also victims.
"It's an unavoidable situation, but since it's our responsibility, we will imdiately pay the penalties for contract termination."
The Japanese representatives, who had co to argue, found themselves pleading.
"Never mind the penalties, please just resu supply. You know the situation of the Japanese electronics industry right now, don't you?"
"Without OTK batteries, the performance of Japanese electronic devices will inevitably fall behind."
"Chairman, please speak to CEO Kang Jin-hoo on our behalf."
"The governnt started this, what did we do wrong?"
"Considering our past business relationship, we beg you."
Chairman Im Jin-yong nodded.
"You're right. Aren't you and I both suffering because of the arbitrary decisions made by those above us? I will do my best to persuade CEO Kang Jin-hoo. Please, all of you, also work to get the Japanese governnt to ease the sanctions."
Reviews
All reviews (0)