Seoul fights dirty in war on imports

Last October, a 40-year-old woman named Kim Kyong Suk was murdered in one of the most brutal ways imaginable. Early one morning, as she was driving home from the bar which she owned, a gang of nine young men pulled her from her car, and forced her to tell them her bank PIN. After emptying her bank account, they drove her to an abandoned warehouse, dug a shallow pit and, having knocked her around with a baseball bat, buried her alive.

The killers called themselves the Makka-pa or "Forsaken Life Gang", and they were caught a few days later when police stopped them in their victim's car, a Japanese Honda Accord, and discovered the bloodied baseball bat. Almost as remarkable as the cruelty of their crime was its motivation. "I wanted to take revenge on the world," said one of the gang, 20-year- old Choe Chong Su, when the police asked him why he did it. "And I especially hate people who drive fancy foreign cars."

The shivers this provoked in Korea were unusually intense. For the last 10 months, the media and consumer groups in Seoul have been riding a wave of negative feelings about foreign imports, of which the Makka- pa affair was only the most sensational manifestation. Within days, Seoul newspapers were carrying articles about female motorists cancelling their orders for foreign cars for fear of similar crimes. "It definitely affected sales," says Allan Rushforth, executive director of Rover Korea. "It was a key factor in the message that it is a bad thing to be seen in an imported car."

Without doubt it is a tricky time to be a foreign businessman in South Korea. This week the head of the World Trade Organisation, Renato Ruggiero, became the latest in a series of high-level visitors to draw discreet attention to an anti-import drive campaign which foreign diplomats and businessmen claim is being carried out with the approval and indirect encouragement of the Korean government.

The "frugality campaign", as it is called, took off last year when trade statistics began to reveal an alarming downturn in the economy. Last year, Korea's rate of growth was 6.8 per cent, healthy by European standards, but a jolting tumble from the 1995 rate of 9 per cent. More worrying was the fact that a country of 45 million people had a trade deficit of $23.7bn, second only to the United States.

The mass of Korean imports are capital goods like fuel and heavy machinery - consumer goods make up little more than one-tenth of foreign sales, so a Buy Korean drive is likely to make little difference to the trade deficit. But this has not prevented an intense and vitriolic campaign which has left foreign firms, including Marks & Spencer, Inchcape and United Distillers, on the ropes.

Consumer organisations have launched aggressive campaigns to promote "rational" consumption and domestic produce. An organisation called the Korea Central Council of Nightspot Operators has barred imported drinks from its premises. Small shopkeepers say that they have been visited by representatives of the state tobacco monopoly and ordered not to sell foreign cigarettes, under the threat of having their supply of the domestic brands withdrawn. "We've seen pamphlets with cartoons of Uncle Sam stuffing burning cigarettes into the mouths of children," says one whisky importer. "Xenophobic nationalism is the order of the day."

This year, the giant Daewoo conglomerate, which operates hotels, trading companies and department stores, announced that it would cease to import all foreign goods. The government insists that the consumer groups are acting independently and that their activities are nothing to do with it, but the most sinister aspects of the campaign bear a markedly official stamp.

The recently opened branch of the French supermarket chain Carrefour has found itself the subject of repeated health checks, sometimes twice a day. Customs inspectors have become unaccustomedly zealous, delaying shipments and invoking the letter of the law: on a consignment of shoes imported by the new Seoul branch of M&S, for instance, the country of origin was written on stickers. Customs insisted it had to be carved into the sole.

Newspapers have carried countless stories with such headlines as "Government Should Put an End to Ruinous Importing Disease". The government has declined all invitations to denounce the campaign and diplomats and officials are becoming increasingly impatient. "It's government by press release," says one diplomat, "and the beauty of it is that it's all deniable."