Yoo Seung-min: "Unaware of the Financial Crisis Triggered by Legoland... President and Government Must Establish Measures"

"May Have to Undergo More Painful Restructuring Than During the IMF Crisis"

Former Assemblyman Yoo Seung-min [Image source=Yonhap News]

[Asia Economy Reporter Hyunju Lee] Former lawmaker Yoo Seung-min warned on the 25th, "We do not know where the end of the financial instability triggered by the Legoland bankruptcy will be," adding, "We may have to undergo a more painful restructuring than what we experienced during the IMF crisis."

On the same day, Yoo posted on his SNS, "The 1997 IMF crisis began with the bankruptcy of Hanbo Group in January of that year," and said, "At the time of Hanbo's bankruptcy, no one realized that a huge crisis was about to hit."

He cited the recent Legoland incident as an example, saying, "If the fire is extinguished with an emergency liquidity measure of 50 trillion won, it would be a great relief," but also assessed, "The current situation of the financial and real economy is really serious."

Yoo suggested, "Although the president, government, and Bank of Korea are late, they must now assume the worst pessimistic scenario and prepare countermeasures," adding, "It is especially important to adhere to economic principles in difficult times." He also mentioned the need for interest rate hikes, liquidity supply, and protection measures for those who are forced out through restructuring.

He stated, "Not everyone can be saved," and argued, "When corporate and financial bankruptcies are imminent, criteria and means to decide whom to save must be devised in advance." He continued, "Looking back, during the IMF crisis, the restructuring of corporations, finance, and labor was excessively harsh due to the demands of the IMF and IBRD, which lent dollars," and emphasized, "I hope this crisis will be overcome under the leadership of our government so that we do not repeat such regrets."

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