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South Korea staged in 1998 one of the largest citizen mobilizations in its history: more than 3.5 million people handed over personal and family gold to help pay off the debt the country had incurred with the International Monetary Fund (IMF) after the 1997 financial crisis.
The campaign was driven by the public broadcaster KBS together with Korean banks, following a previous initiative launched weeks earlier by a women’s association. The goal was to raise resources to ease the country’s foreign debt and speed up its economic recovery.
How did South Korea gather 227 tons of gold?
The mechanism was simple: citizens took their gold pieces to participating banks, which bought them at market prices or slightly below. In return, donors received South Korean won, although many refused any compensation.
What objects did Koreans hand over
- Wedding rings from newly married couples
- The traditional “dol-banji”, gold gifts for the first birthday
- Military badges from war veterans
- Olympic athletes’ medals
- A pectoral cross donated by a Catholic cardinal
Participation grew at a rapid pace: about 500,000 people had joined by January 6, 1998, a figure that reached one million nine days later. By the end of April, the total accumulated reached 227 tons of gold, valued at about US$ 2.13 billion.
What impact did the campaign have on the debt to the IMF?
In strictly financial terms, the contribution was limited: it represented only 3.7% of the US$ 58 billion rescue package that the IMF granted South Korea. The gold collected was melted down, exported, and sold on the international market to pay foreign debt.
However, the symbolic effect far outweighed the direct economic impact. An IMF official told KBS that he had never seen a comparable citizen mobilization in any other country assisted by the organization. South Korea finished paying off its debt in August 2001, three years earlier than planned.