Chaebol the claim that in order to be a competitive economy more power must be given to the chaebol. In recent years, the leading political parties of South Korea have reversed their pro-large corporate stance to one of economic diversification. Under Kim Dae-Jung and in the wake of the 1997 Asian Financial crisis, many reforms were made to the chaebol. Most of these changes pertained to corporate structure, transparency in financial reporting, corporate governance, and debt stabilization. In 1997, the IMF provided a bailout loan of $60 billion conditional on revision. Distressed financial institutions were to be closed down and those
Trade policy of South Korea of luxury goods increased including high tech and electronics products which reduced exports which resulted in Korea's trade deficit and current account deficit. In mid-1990's Korea reduced tariff rates and import restriction on autos, high tech products and financial services. South Korea and the Asian Financial Crisis Korean Banks and Chaebol borrowed heavily from the foreign banks on a short-term basis. The money was taken to fund investment in the industries at the encouragement of the government. The heavy reliance on the short term foreign loans led the Korean economy to suffer from the currency crisis, as foreign reserves were