What is Chaebol?

Chaebols are large groups of family societies in South Korea. Literally the word Chaebol , pronounced jay bol or chay bol means a business association. Chatebols are said to have been created during the Late Dynasty of Chosun before the formal Japanese annexation in 1910.

In its present form, chabols have political association and most of the big charaebols are owned by the government. This form of government Chabor was established during the reign of Park Chung Hee (1961-1979). The park founded its model chabola on the Japanese system ZAIBATSU, the only difference between chabols and Zaibatsu is a source of capital. Banks financed Zaibatsu while Chaebol cannot own a bank. The government of sponsored chabola was assigned to the government's funds and have special privileges. Large companies were expected to ensure an export market and achieve increased profitability through extensive productions. The government also gave them projects and foreign countriesLoans. As a result, Chaebols dominated the Korean economic scene at the end of the 90's. The Korean government controlled these chaos and allowed some growth and some decompose.

Chaebols played a huge role in technological progress in Korea and also helped to expand research and development activities (R&D). This was because of these Chaebols that by the end of the 70s Korea had developed some of the largest industrial companies in textiles, a raising, plywood, cement and a heavy machine.

Korean huge economic development in the past of the Three of decades has been attributed to its chabols. In fact, however, the Chaebols showed only government chaos, while others faced the weight of huge debts. When Chaebols relied on political support rather than their own performance, their success varied with changes in the government. Only three out of the ten largest chabols in 1965 survived another ten years; Were tAbout Samsung, LG and Ssangyong. The International Monetary Fund (IMF) suggested that Chaebols will undergo the overall reform. It is not an easy task of interrupting the links between the trade persons Chabor and South Korea.