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Gangwon Province Failed to Repay Legoland Debt
Kim Jin-tae, the Governor of Gangwon Province (yna.co.kr)

When the governor of Gangwon Province, Kim Jin-tae, refused to pay the Legoland debt guarantee of ₩25 billion, it turned the financial market into chaos. Legoland opened this year on Children’s Day after Gangwon Province and Nick Barney Merlin Entertainment agreed to an investment deal. Gangwon Province had issued bonds with the Gangwondo Development Corporation and operated the business with the funds received. Due to rapid inflation and worries that the crisis has been pushed onto the real-estate firms, it has become a heavier blow to the domestic economy. Bond and loan markets became “strained” due to the failure of the local self-governing body of Gangwon Province, which had guaranteed government loans. As a result of investors’ lack of confidence in the bonds issued by traditional financial institutions, pressure has built on the real market. The bond market stabilized after the Bank of Korea decided to provide financial and real estate companies ₩50 trillion in liquidity. However, criticism of the government’s late response has surfaced, and questions have been raised if this can be the fundamental solution to this problem. Additionally, some maintain that it is absurd that the government was unaware of this situation. Some insist Kim Jin-tae should resign from his position and take responsibility for this problem. It is not just Legoland that is the issue; the case is also intertwined with fluctuating inflation and exchange rates, increasing market anxiety. Hence, future measures are anticipated to be more crucial.

김하진  0804grace@g.skku.edu

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