Thursday, December 15, 2011

Man of steel, Park Tae-joon...

Man of steel, Park Tae-joon...
By Yong Kwon

On December 13, a modern-day miracle-maker passed into history. His contribution to South Korea's epic economic ascension has been largely overshadowed by the legacy of president Park Chung-hee.

However, those who only see the achievements of the late dictator should note that without the tireless effort of another Park, the drive for economic development could have been scuttled at its very inception. The late hero's name was Park Tae-joon.

He was born in 1927 near the growing port city of Busan. In 1933, he crossed the Korea Strait to join his father, who had emigrated to Japan for better job opportunities. Excelling in school, he began studying mechanical engineering at Waseda University in 1945, but dropped out and repatriated to Korea at the end of World War II.

In the midst of the post-liberation political chaos, Park entered the Korea Military Academy and met Park Chung-hee, who was at the time a ballistics instructor. Park Tae-joon described his first encounter with the future president as having felt "like the chill of the morning air blowing through the front door". It was the beginning of a dynamic partnership.

After serving with distinction in the Korean War in the early 1950s, Park Tae-joon reunited with Park Chung-hee and served under him as his chief of staff. Praising his work ethic and obsessive perfectionism, then-Colonel Park Chung-hee described him as a "piece of iron".

The close bond between the two Parks was evident in the run-up to the 1961 coup d'etat. According to anecdotes, Park Chung-hee asked his former pupil to not participate in the military uprising so that he would be able to take care of the elder Park's family if the coup failed. Nonetheless, as Park Chung-hee's forces marched into Seoul early on May 16, 1961, Park Tae-joon was present at the headquarters of the anti-government forces, throwing in his lot with his superior.

This act of defiance firmly placed Park Tae-joon in the inner circle of the new regime, and he was soon elevated to a significant position in the Supreme Council for National Reconstruction, the new junta's governing body that paved the way for Park Chung-hee's Third Republic.

After helping design president Park Chung-hee's first Five Year Plan (1962-1964), Park Tae-joon turned from commanding soldiers to nurturing Korea's nascent industry. In 1964, he became the head of Korea Tungsten Company, forerunner of today's TaeguTec, and managed what was then one of a handful of frail companies that exported abroad.

As gifted of a soldier and economic planner he was, it was in the corporate world that the full extent of his skills became truly evident. President Park's economic planners decided that South Korea needed to achieve self-sufficiency in steel to establish the foundations of other industries.

However, the astronomical cost of constructing the infrastructure and the sheer magnitude of the project baffled many domestic industrialists. Was it truly feasible for a country with an individual per annum income of US$100 to engage in such a massive gamble? President Park turned to Park Tae-joon.

Park Tae-joon was also a deep believer in steel self-sufficiency, calling it the "rice of industry". In 1965, he began studying foreign steel industries, and by 1968 Park Tae-joon was travelling to various countries actively seeking the necessary funds and technology to begin constructing steel mills in South Korea.

Objectively, it was difficult for any organization to lend or invest the required vast sums to a hopelessly underdeveloped Third World economy. Summing up the sentiments of others, the president of the International Bank for Reconstruction and Development told Park Tae-joon that it was too premature for South Korea to engage in such a high-tech industry and suggested concentrating his efforts in labor-intensive manufacturing. Turned down by the world, Park Tae-joon decided to turn to another source.

A few years' earlier, Seoul and Tokyo had signed the "Treaty on Basic Relations between Japan and the Republic of Korea", with Japan promising millions of dollars in grants and soft loans to the Korean government. Park Tae-joon consulted with Park Chung-hee and persuaded him to divert a portion of the funds set aside for agricultural development to construct steel mills in the sleepy seaside town of Pohang.

It was extremely controversial. Bureaucrats in Seoul questioned his every decision and looked at the enterprise with doubt. Tokyo was also wary of changing the already agreed upon financial arrangements. Even Park Chung-hee disagreed with him on the level of government involvement in the would-be steel company. Nonetheless, Park Tae-joon managed to dog all his detractors into agreeing with his plan.

Recognizing what the funds represented, he made an ultimatum to his workers on the day that the steel mill construction began: "We are using the funds from Japan that contain the blood and sweat of our forefathers. If we fail to complete this steel mill ... let us all drown ourselves in the East Sea!" This was the beginning of the Pohang Iron and Steel Company (POSCO).

It was an endeavor on which South Korea's future was riding, and no one took the project more seriously than Park Tae-joon. Visiting the construction site, he wore his military uniform and carried with him a commander's baton. He considered military discipline to be essential; after all, he was jump-starting a nation's heavy industry in an empty field with people who had little to no experience.

The international community looked at the steel mill enterprise with skepticism. Japanese companies that provided the essential technology for steel-making doubted South Korea's ability to produce a competitive industry. Korean economists were also nervous - many already considered President Park's highway project a waste of public funds and the budget for the steel mill in Pohang was three times the entire cost of the Seoul-Busan highway.

In April of 1971, Park Tae-joon inaugurated the first steel mill, and by 1973 he surprised every detractor. POSCO laid the foundations for South Korea's shipbuilding industry, which began in pits dug in the beaches near Pohang. Within a few decades, South Korea was dominating the global share of ship-making, beating out Japan and Britain.

In addition, POSCO acted as the engine that drove forward the growing automobile industry, whose exports also gave momentum to South Korea's rapid economic ascent.

People began calling Park Tae-joon the Andrew Carnegie of South Korea - but this may be an unfair comparison. Carnegie built his steel mills in a country that already had the technological know-how and the industrial basis for creating the necessary infrastructure.

Park Tae-joon created the infrastructure out of brute force of will, and POSCO under his chairmanship produced 21 million tons of steel, nearly twice what Carnegie's mills produced in 35 years. By the time Park Tae-joon left POSCO's chairmanship in 1992, the gamble had turned into the third-largest producer of steel in the world.

His accomplishments had by the late 1970s already earned him a legendary status among industrialists. In 1978, while touring a steel mill in Japan, Chinese leader Deng Xiaoping asked chairman Yoshihiro Inayama of Nippon Steel Corporation whether he could build a similar steel mill in China. Inayama replied that such an undertaking would be impossible because China did not have Park Tae-joon - to which Deng jested in return that he only needed to import Park.

On top of his industrial contributions, Park Tae-joon was acutely aware of the importance of educating future generations and established the Pohang University of Science and Technology in 1986 and the Research Institute of Industrial Science & Technology in 1987, both foremost facilities for education, research and development in South Korea.

After the assassination of Park Chung-hee in 1979, Park Tae-joon entered politics as a member of the National Assembly and became a crucial member in the coalition government that brought about both the Roh Tae-woo and Kim Dae-jung governments.

He was forced out of politics in 1992 under scrutiny from president Kim Young-sam over alleged corruption charges, which later turned out to be false. He returned to government during the economic fallout in 1997, working to resolve the economic crisis, and briefly served as prime minister in 2000 before being forced out over charges of real estate speculation.

Nonetheless, nothing so far suggests that he abused his deep connections in government or industry for personal gain.

Those who knew of him understood his significance - someone said of Park Tae-joon that "when Korea needed an army, he was an officer; when it needed to raise its economy, he was a businessman; when it needed a vision, he was a politician".

It would not be an overstatement to suggest that he embodied the political and economic transformation in South Korea since its founding. He lived life without a moment's breath wasted; many of his close colleagues said that the only thing hotter than the molten steel in the mills of Pohang was Park Tae-joon's passion, the epicenter of the industrial complex - and today his Herculean heart continues to forge South Korea's future.

He is survived by his wife, five children and a more prosperous country.

Yong Kwon is a freelance writer for Korean, Russian and Central Asian affairs.