Chapter 470 Nobody Likes Getting Involved (Bug Fix): Did they think she was a sucker?

Given that Russia is not a very reasonable country, well, it has always been so throughout history; and that South Korea tends to back down at crucial moments, adopting a "you two decide, I'm fine with anything" attitude—IMF representative Mr. Steven had no choice but to back down in frustration.

Who told him he couldn't out-argue Ivanov?

The latter, from the moment he became deputy prime minister, argued almost every day, either with Chubais, or with Nemtsov, and then with the oligarchs. He also had to get Soskovets, who had chosen nonviolent non-cooperation, to personally express his agreement with him. His mouth had long been honed.

With a little effort, Steven was rendered speechless and had no choice but to bite the bullet and ask his superior for instructions.

My God!

How did he end up dealing with these two countries?

Needless to say, South Koreans have a lot of ulterior motives; they want IMF money but don't want to be controlled by others.

Not to mention Russia, it has never been a law-abiding country since the Soviet era!

Mr. Steven stormed off in a huff.

The remaining officials, including Minister Lin, all had solemn expressions.

While it's satisfying to see the IMF get its comeuppance, South Korea doesn't really have the strength to stand up to the IMF right now, as it still relies on their money for survival.

Compared to them, Ivanov was much more relaxed, and even smiled and took the initiative to comfort them: "Don't worry, the International Monetary Fund has the same goal as us, and we all hope for stable economic development."

Minister Lin didn't know what to say, so he could only manage a forced smile.

But the young Russian First Deputy Prime Minister in front of him seemed oblivious, continuing to speak at length: "There are no colonies after World War II, so the IMF can't exactly create a financial colony, can it?"

He laughed out loud. "After all, we're talking about freedom now."

Minister Lin always suspected that there was something hidden in his words, but he couldn't quite pinpoint which word he used that was particularly meaningful.

So, as the host, he could only politely say, "I hope everything goes well."

But once everyone had parted ways and returned to their own territory, and the car door was closed, Minister Lin burst out laughing: "This Russian deputy prime minister is really interesting."

The fact that the South Koreans were able to silence IMF officials, even if it was just a brief moment of frustration, was truly a source of great satisfaction for them, especially since they had been forced to beg for IMF aid since November of last year.

For him in particular, as the lead negotiator and signatory of the $58 billion emergency bailout agreement with the IMF, this was a dark moment and a tremendous humiliation in his life.

His assistant laughed along, saying, "Everyone says he's an unconventional politician."

Everyone says this has a lot of moisture.

Although Ivanov is very popular in Russia, he actually has little international presence.

Everyone knows how he came to power; it was nothing more than a deal between the president and his supporters. Besides, Russia's deputy prime ministers change frequently, so there's really no need to pay too much attention.

Moreover, although Chubais served as the Kremlin Chief of Staff during the president's second term, he frequently visited the White House, so it is generally accepted that the second phase of economic reforms initiated by the Moscow White House after August 1996 was also Chubais's doing.

It wasn't until November 4th of last year, when Ivanov suddenly announced a 15% devaluation of the ruble, that international powers suddenly noticed that this Russian political mascot seemed to have some merit.

Surprisingly, the announcement of the ruble's devaluation did not cause panic among the Russian people, and within two months, subsequent reforms were being implemented step by step.

Even the proposal to exchange GKOs for long-term oil and gas bonds seems to have been accepted by the Russian people.

Minister Lin sighed, "He's really lucky."

The assistant laughed: "That's right, he's got a lot of luck with women, he just attracts rich ladies."

The reason for this statement is that after Russia launched its long-term oil and gas bonds in November, the deputy prime minister's fiancée immediately bought three-year Russian bonds worth $300 million to support her fiancé.

This move immediately caused a stir in the Russian business community.

It is said that the merchants in the container market under her name alone have purchased Russian government bonds worth $200 million.

Then, prominent figures in Russian politics and business, such as the famous Moscow Mayor Luzhkov and the so-called "godfather" of the Kremlin, Benezovsky, all took action, either by purchasing three-year bonds, five-year bonds, or directly converting their holdings of GKO into long-term government bonds.

With them taking the lead, Russian citizens who were originally skeptical about long-term government bonds were also swayed and gradually began to convert their GKO bonds into long-term government bonds.

How absurd! It's as if these people don't have brains. They just follow along without a word if someone sets up a queue.

When the assistant first heard the news, all he could do was shake his head.

But upon further reflection on the six-month-long financial crisis, the Russians' choice seemed quite reasonable.

After all, who could have imagined last summer that the financial crisis that originated in Thailand would spread all over the world? Even the US stock market was not spared.

Including South Korea, by autumn, the Southeast Asian financial crisis had already raged, but no one at home or abroad expected that it would also be unable to escape this calamity, and that the situation would be even more serious than in other countries.

What can I say?

To put it simply, people's financial investments are even more blind than naive children chasing after pop stars and movie stars.

So now, the assistant can only sigh, "Russia is really lucky."

Then I swallowed the thought in my mind: if South Korea had chosen to devalue the won earlier, things wouldn't have gotten so out of control.

Minister Lin couldn't read minds; he could only hear what others said. He replied, "I hope South Korea will have such good luck too."

Upon hearing this, everyone on the bus fell silent.

South Korea reluctantly signed the IMF agreement, and considering the situation of Thailand, the first country to receive IMF aid in this financial crisis, what good luck can South Korea possibly have?

Finally, Minister Lin broke the silence, as if reassuring himself: "We're not in a hurry, we have time. Let's see how anxious Russia is first."

Anyway, the worst-case scenario has already happened. At worst, it will be the IMF's solution for Russia and South Korea, which will not allow South Korea to convert its GKO holdings into Russian long-term government bonds.

But so what? It just means we'll lack the funds to make a comeback three years later.

The most important thing for South Korea right now is to get through the current difficulties. Let the future deal with it.

Russia, on the other hand, is now teetering on the edge of a cliff, struggling to climb up by clinging to vines, hoping not to fall directly into the abyss.

They are probably the ones walking on the edge of the ice the most.

Standing at the bottom of the cliff, watching the people hanging there in a heart-stopping way, struggling to survive at the gates of hell, is certainly a sight to behold.

Moreover, if they succeed, South Korea might be able to take the opportunity to launch another round of supplementary negotiations with the IMF to improve those stringent conditions.

Good heavens, according to the IMF agreement, South Korea must keep interest rates above 25% to attract foreign investment.

While such high interest rates can temporarily stabilize the Korean won, they are also a deadly poison.

It completely froze South Korea's domestic credit market.

No company, not even the healthiest one, can afford such high loan costs.

This would lead to a massive liquidity crunch, triggering a wave of corporate bankruptcies that would quickly spread from the financial sector to the entire real economy.

Without a doubt, this is not treating the disease, but rather killing the patient.

He must find a way to push forward with subsequent negotiations in order to give South Korea a better chance of survival.

Minister Lin, with a heavy and unspoken thought in his heart, made his way to his office.

After sitting down, he casually asked, as if he had just remembered something, "What is Miss Wang busy with?"

Although she arrived in Seoul on the same chartered plane as Deputy Prime Minister Ivanov, she did not come to South Korea as his fiancée, and she was not on the list of personnel on his working visit.

In that case, the South Korean government should naturally respect her private schedule and allow her to move freely.

The assistant quickly replied, "She is currently inspecting various semiconductor companies, preparing to acquire them using the identity of a Hong Kong businessman."

Minister Lin didn't really understand her identity.

Given South Korea's current situation, what difference does it make whether foreign companies buying South Korean businesses come from Russia, mainland China, or Hong Kong?

As he took off his coat, he asked with interest, "Oh, so who is she talking to now? Samsung, Hyundai, or LG?"

The assistant shook his head: "She has visited all the semiconductor companies, but so far none of them have actually sat down with her to talk."

"Oh?" Minister Lin was surprised. "Is it that these conglomerates are unwilling? What do they want to do?"

He truly couldn't suppress his anger towards the chaebols.

The financial crisis came so suddenly, and one of the most important core internal causes was the excessive expansion, high leverage ratio, and blind, octopus-like diversification of large conglomerates.

They rush into everything, regardless of their skills or the necessary conditions, forcing themselves to do it anyway.

Relying on their special relationship with the government, they obtained blind credit from domestic banks and borrowed heavily to invest in many unprofitable non-core areas, resulting in the accumulation of huge and unbearable debt risks.

This is not how government support should be used, nor is this how resources should be concentrated to accomplish major tasks.

Reform is necessary; these arrogant tycoons must be forced to withdraw from areas they are fundamentally inept at.

Only by divesting conglomerates of their non-core assets and eliminating meaningless duplication of investment can these conglomerates concentrate their resources on developing core businesses with global competitiveness.

Even now, these large conglomerates haven't shown any willingness to sever ties and save themselves. What are they really up to? Are they still hoping the government will squeeze money out of them to rescue them?

With the country's finances bankrupt, it had no choice but to seek help from the IMF. Didn't they know what that meant?

Seeing his boss's displeased expression, the assistant quickly explained, "It's the employees who are unwilling. Whether it's LG Electronics or Hyundai Electronics, the employees of these large companies are reacting strongly, threatening to resign en masse if their company or department is sold off."

Minister Lin couldn't help but start coughing again; it was an old ailment of his.

Moreover, this time, not only did his throat hurt from coughing, but his head also ached.

South Korea must reform, in every aspect, including changing the mindset of its employees.

If businesses are struggling to survive, what kind of lifelong career can one speak of?

He finally managed to stop coughing and sighed, "So, what about this Miss Wang?"

The assistant shook his head: "There's no good solution. It seems they're still waiting for the conglomerate to persuade their employees."

He smiled wryly, "She has at least $1.7 billion in funds, but she still can't spend it."

Minister Lin accepted the tea brought to him by his secretary, took a sip, and then sighed, "The government is always short of money, while the chaebols are always rich."

The reason why Russia's deputy prime minister came to South Korea to discuss the conversion of GKO into long-term government bonds is simply because he has no money.

But that didn't stop his fiancée from becoming incredibly wealthy.

The assistant couldn't help but sigh, "That's why he's so lucky. Last summer, Ms. Wang sold 10% of the electrical company's shares for $2 billion, which not only made the buyer extremely grateful, but also directly eased the tense political and business relations in Moscow at the time."

And now? The Russian stock market has plummeted, and those who cashed out early are now holding a huge amount of cash that everyone envies. They also helped their fiancé again by spending 300 million US dollars to increase the value of Russian oil and gas bonds.

Aside from envying their good luck, there's really nothing else to say.

Minister Lin took another sip of tea, put down the teacup, and sighed softly, as if to comfort himself: "It's good that the employees are unwilling to sell; it's also proof of the company's value."

He clearly understood that he had to give up some things in order to preserve the most essential part.

As long as the sale helps strengthen South Korea's more central and advantageous position in the global industrial chain, such a transaction is acceptable and even encouraged.

The assistant echoed his boss's words: "That's true, if we're going to sell, we should sell for a good price. The longer they hold out, the higher the price will be."

The office door opened, and the secretary brought a tea tray to the doorway.

The new employee in the department was standing at the door waiting to take the tea tray and take it out.

He heard the minister's voice coming from inside and instinctively wanted to say something like, "Perhaps the employees of those large conglomerates' semiconductor divisions have already changed their minds."

The online forums are in an uproar. Everyone is saying that the government will reorganize its agencies, lay off civil servants, and will definitely cut departments of large conglomerates. The employees of these once high-ranking conglomerates will also have to pack their bags and leave.

But he swallowed the words back down.

Why should he show off in front of his superiors' superiors when his superiors didn't even ask him?

Who cares what's being discussed on online forums? Bosses only read newspapers, magazines, and watch TV news; how could they possibly care about idle chatter on online forums?

If he says these things, nine times out of ten he'll be seen as trying to attract attention, and he might even incur the hostility of his boss.

Besides, what's the point of him saying it? The person who discovers the problem will 100% become the one who solves it.

He's already busy, tired, and stressed enough; he really doesn't want to take on any more work for himself.

Not only him, but even his superior's superior, Minister Lin, felt that he was like a clay bodhisattva crossing the river, barely able to save himself.

After all, the new president, who will take office in February, had his campaign team publicly declare on December 6th last year: "If we are elected, we will renegotiate with the IMF!"

It's easy to imagine that Minister Lim, as one of the signatories of the agreement between South Korea and the IMF, was disliked by the new president.

Even if the new president later changed his tune and stated at his post-election press conference that the Qing government would support the IMF aid agreement, so what?

Accepting the agreement doesn't mean you don't dislike the person who signed it.

It's hard to say whether Minister Lin will still be a minister when the new president takes office.

Why is he worrying about his boss's boss? He should be worrying about where his next job will be.

See, this is the law governing how society operates.

Everyone was exhausted and really didn't want to cause themselves any trouble.

Therefore, the world is a series of information cocoons, and they are like two different planets to each other.

Even people who move between the two worlds are too lazy to bother with things that are considered unimportant or even inferior by mainstream society, and instead bring them to another "higher" world to tell their stories.

The office door closed, separating two worlds.

However no matter how noisy it was at night, it was still a niche world for South Koreans in 1998.

What truly ignited nationwide panic about unemployment was an interview with Steven by South Korean media.

Since the outbreak of the South Korean financial crisis, the IMF, which they feared and loathed, has simultaneously become the focus of national attention.

How were the negotiations conducted? What agreements were reached? How will these agreements be implemented? These questions affect the future lives of countless families.

They wanted to close their eyes and plug their ears, but they couldn't; they could only try to know more amidst their pain.

This time, the question asked by the reporter was: Will the IMF force South Korean companies to lay off employees?

Steven really disliked the question from the South Korean reporter, as it was a fallacy of misrepresentation, portraying the IMF as a robber that stole countless jobs from South Koreans.

He bluntly stated, "The idea that 'IMF = I'M Fired' is absurd. South Korea's crisis is attributable to a complex web of internal structural failures, including the unchecked expansion of conglomerates, inadequate government oversight, and reckless lending by banks. The IMF is here to help South Korea and its people. We are providing timely assistance, not acting as exploitative international lenders."

The reporter needed a definitive answer: "So, will the IMF allow companies to lay off employees?"

Steven dodged the question: "The IMF's bailout conditions require South Korea to implement austerity measures, raise interest rates, and promote corporate restructuring to reduce the alarmingly high debt ratios of conglomerates, stop their irrational, octopus-like diversification, and focus on core, profitable businesses. As for the specifics of how to implement these measures, that's up to the South Korean government and companies to decide."

If you have a way to significantly reduce expenses and still make a profit without laying off employees or eliminating any departments, that's your skill, and no one can stop you.

Otherwise, to reduce debt, assets must be sold to generate cash. The top priority for sale would be departments unrelated to the core business and those that are consistently losing money. At the same time, closing these departments and dissolving related subsidiaries would naturally lead to large-scale layoffs.

Can that be considered a result of IMF coercion? No, that's clearly a sign of your incompetence.

It's not that we didn't give you a choice!

This interview with the IMF representative quickly spread throughout South Korea through newspapers, magazines, and television broadcasts.

In an instant, the fear of unemployment spread like a plague to every household.

The Miracle on the Han River lasted so long that people almost forgot the pain of the economic downturn. Now, the sudden plunge into hell is driving people almost insane.

They cursed the tycoons, these greedy pigs who blindly expanded and misused funds, dragging the country into the abyss, while ordinary employees and society ultimately bore the cost.

They angrily denounced the government, calling them idiots who were in cahoots with the chaebols, weak and incompetent in managing the chaebols, unable to control them, and that when things got out of hand, they would just sell South Korea to the IMF, showing no responsibility or accountability whatsoever.

Steven drove a nation into madness with just four sentences, yet he remained completely unconcerned about their frenzy.

He's going crazy right now because of Russia's unreasonable behavior and complete disregard for rules, because of South Korea's subservient attitude and refusal to stand up for Russia, and even more so because of the ambiguous attitude of his senior colleagues at the IMF.

When he first reported that Russia and South Korea were going to sign an agreement behind the IMF's back, his colleagues were furious, thinking that both countries had gone mad.

Impossible, absolutely impossible!

But Steven had just finished a late dinner and was preparing how he would vehemently criticize the two deputy prime ministers' outlandish ideas the next day.

God, he swears, he didn't just mentally prepare, he actually wrote down the key points on paper.

Just as he was about to go to bed, he received another call from the IMF headquarters in Washington, D.C. His superior, who had initially shared his views, began to stammer: "David, please don't rush to make a statement. The Russian GKO issue is negotiable. Please wait a moment, I will be there as soon as possible."

Steven was stunned and almost jumped out of bed—God, he really disliked the winter climate on the Korean Peninsula, it was so cold and damp.

"Andrei, what do you mean? What's there to talk about? It doesn't comply with any of the rules, regulations, or disciplinary rules!"

His superior reassured him: "Our top priority now is to maintain stability at all costs."

Steven couldn't accept it: "What do you mean by 'at all costs'? Clearly..."

"We're already teetering on the brink of a global financial crisis!" The boss finally raised his voice. "David, you're an economics expert too. You should know that the stock market crash, with the Dow Jones Industrial Average falling from 8,000 points to 5,000, signifies a collapse in confidence in the US domestic market, paralysis of corporate financing, and an extremely high risk of recession. The Fed's interest rate cut is a desperate self-rescue signal! Now, any event that could ignite the next powder keg must be stopped!"

Steven was a little stunned by the yelling and instinctively tried to defend himself, "But..."

“No buts!” his boss interrupted him directly. “Don’t forget, that’s Russia. If its financial system collapses, it will inevitably lead to an Eastern European crisis, which will then spread to banks throughout Europe and then impact the American financial system once again. God, David, you know how terrible that is. This path must be cut off.”

Currently, although Europe has been affected by the financial crisis and stock markets are generally declining, at least the epidemic has not spread directly to its own territory.

But if Russia runs into trouble, Europe will inevitably be affected.

Compared to that, the bankruptcy of GKO, which caused losses to Wall Street funds and further exacerbated the Asian financial crisis, are not such a big deal.

Steven, at his wit's end, exclaimed, "So you're ignoring the investors' interests? This is a disguised breach of contract, violating the fundamental principles of financial investment. Who will protect their interests? This is nothing short of outrageous robbery!"

The boss's voice was serious: "No, David, we have to consider the bigger picture. We need to prevent South Korea, a major economy that is struggling to recover, from immediate losses in Russia, and give Russia three years to recover, thus avoiding a global financial crisis triggered by a GKO default."

He reassured his trusted subordinate, “Hey! My buddy, don’t be too pessimistic. Think about it, Russia’s long-term bonds are secured by oil and gas resources. The OPEC meeting results are in: oil production won’t increase this year. Oh God, they’ve finally done something smart, which means oil and gas prices can be basically stabilized. Their collateral has value. This isn’t a disorderly debt default, but a well-collateralized and orderly debt restructuring.”

Steven felt his worldview crumbling. He futilely insisted, "No, we can't open this door. Once Russia starts, other countries will follow suit. It will cause chaos. You know, the global financial order will be thrown into disarray."

His boss had to patiently reassure him: "David, don't be nervous, things won't get chaotic. We won't agree to their agreement outright; we'll set more restrictions."

"We will ask Russia to commit to using the funds saved from this debt restructuring specifically for urgent domestic fiscal and social security expenditures, rather than military spending, etc."

“We demand that South Korea commit that this move is part of its foreign exchange management and will not affect its domestic reform process.”

"Moreover, this is a special case, and we will emphasize its secured nature to the world to prevent other unsecured creditors from following suit."

Steven exclaimed, "No, none of this will work. It will still be cited and imitated as a loophole to escape IMF oversight."

He pleaded, "Andrei, we really can't set this precedent."

However, his superior flatly refused him: "No, David, you must understand that not all countries are Russia. There are always a few major countries in this world that need to be carefully considered. Okay, let's not discuss this anymore. I'll come over and talk to them in detail in Seoul. Now, please get some rest."

Listen to this! Is this human language? This is clearly the devil's declaration!

How could Steven possibly sleep after hanging up the phone? He lay awake until dawn, then waited for his boss to arrive, and sat down at the negotiating table with a blank expression.

God, he swore, this was the most humiliating agreement he had ever signed.

They actually violated the basic principles of the financial world by opening backdoors for Russia and South Korea.

He swore that this was the darkest moment of his life!

The unions of Hyundai Electronics and LG Electronics also felt they had experienced the darkest moment of their lives.

After repeated discussions with members and negotiations with the group, they finally relented and agreed to let the group sell part of its electronics business.

Hyundai Electronics' LCD business unit and LG's chip business will be spun off and sold to other companies.

However, the buyer must provide a guarantee, and this must be written into the contract.

First, layoffs are not allowed. All employees will retain their jobs, and their income must reach the 1996 salary standard. Over the next five years, their income will be gradually increased by 10% each year.

Secondly, the original departments are not allowed to be dismantled; the original production must be maintained, and the factory must not be relocated.

These conditions are undeniably stringent; the requirement to not lay off employees and to increase salaries has led to a surge in labor costs.

The inability to relocate factories means the loss of the possibility of optimizing efficiency by relocating to low-cost regions, essentially locking in a fixed cost structure.

In an industry like semiconductors, which is highly volatile and has a large price fluctuation, the risks are considerable.

It can be said that it is equivalent to buying assets at market price while also taking on social burdens.

To satisfy employees, unions, and the government, the threshold for political correctness is set really high.

But could Wang Xiao refuse outright?

Because giving up would mean losing a strategic opportunity.

So no matter how harsh the conditions are, you still have to negotiate. Buying and selling is all about bargaining. If you reach a point that everyone can barely accept, it's a win-win situation.

For example, regarding the issue of layoffs, a promise can be made not to conduct mandatory layoffs, but clauses on natural attrition and organizational structure optimization based on performance management need to be included.

For employees who voluntarily resign or retire, their positions will not be filled; for employees whose performance consistently fails to meet standards, the company also has the right to reassign them or negotiate their resignation.

This is a common practice in modern corporate management. It ensures the healthy turnover of the team, ultimately enhancing competitiveness and aligning with the long-term interests of all employees.

Otherwise, if LG Electronics and Hyundai Electronics took this opportunity to stuff in a bunch of useless people who could not generate any benefits for the company, even if Wang Xiao were a god, she and her team would not be able to identify them at once.

She's got too much money to burn, why is she supporting a bunch of useless people?

For example, the buyer might accept a salary increase plan but suggest that the increase structure be appropriately linked to the company's profitability. For instance, a 5% fixed increase could be committed, with the remaining 5% linked to the department's or company's annual profit target and distributed as bonuses.

This is done to deeply align employees' interests with the company's future, thereby motivating everyone to work hard and create value together to achieve high salaries, rather than simply spending on benefits.

Regarding not relocating the factory, the buyer can promise that the main production functions will not be relocated, but requires the right to establish a parallel R&D center and backup factory in China.

Because buyers also need to survive. If there's no profit, the company will go bankrupt, and everyone will go down the same path.

To ensure business continuity and fully leverage the supply chain advantages of the Huaxia market, using Huaxia as a supplement and backup to the local factories in South Korea is a necessary risk management measure.

The two sides argued back and forth for three whole days before finally moving on to the next step: discussing money.

It's absurd that after arguing for so long, they still haven't reached an agreement on the acquisition price.

It's clear the other side had something big planned.

Wang Xiao was right. LG Electronics immediately asked for $1.5 billion, and Hyundai Electronics was not to be outdone, asking for $1.2 billion.

They really dare to ask for that!

Wang Xiao was so angry she laughed. She stood up and looked down at the people opposite her: "Gentlemen, even though South Korea is experiencing a financial crisis, you should still open your eyes to the world. Texas Instruments is selling off its entire semiconductor business, and the asking price is $800 million!"

She shook her head. "Forget it, I might as well just buy Texas Instruments. Forgive my ignorance, but this is the first time I've heard that Hyundai's LCD business and LG's chip business are so much stronger than Texas Instruments!"

They really have no self-awareness; they're treating her like a fool!

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Note: Regarding the IMF's interest rate requirement for South Korea in the 1997 aid agreement, some sources state 30%. However, an article titled "The Deputy Prime Minister's Hidden Pain" in the 13th issue of *Business Weekly* in 2007, which I found, mentions that the IMF initially did indeed demand an interest rate of over 30%, which was rejected by the South Korean side. Early in the morning of December 3, 1997, Kang Desu and his wife arrived at Gimpo Airport in South Korea. After being "besieged" by a group of reporters, Kang Desu immediately went to Lim Chang-ryul's office. There, he was met with Lim Chang-ryul and the South Korean government's final struggle at the negotiating table.

The debate centered on interest rates. To attract foreign investors, Condé argued that South Korea's current interest rate should be doubled, from 12.5% ​​to 25%. Lim Chang-ryul expressed great concern, fearing it would impact South Korea's numerous highly leveraged companies. However, Condé's response was that a high-interest-rate policy was a traditional approach of the IMF and must be implemented.

Faced with the firm stance of Kantsu, Lim Chang-ryul knew he had no leverage. Ultimately, he conceded, but demonstrating the tenacity typical of Koreans, he cleverly demanded that the word "temporary" be added to the agreement regarding interest rates. Lim Chang-ryul secretly resolved to implement the interest rate policy effectively in the shortest possible time, then lower interest rates as much as possible to avoid further losses. In fact, interest rates began to decline after the South Korean economy improved on February 17, 1998.