South Korean International Monetary Fund Agreement, 1997

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The South Korean International Monetary Fund Agreement was implemented when South Korea, which was in a foreign exchange crisis, signed a memorandum of understanding with the International Monetary Fund on December 3, 1997.^[1] The country's chaebols, or large conglomerates, had engaged in poor business management and overborrowing, and the government had been supporting the chaebols' financial practices when the Asian financial crisis began.^[2] The IMF required the introduction of a range of policies (such as fiscal and financial austerity, high-interest rates, the dissolution of the chaebols, layoffs, and implementation of floating exchange rates) as conditions for the bailout. The South Korean government under Kim Young-sam accepted those conditions to stave off a crisis.^[3] As a result, corporate bankruptcies, mass unemployment, and a crisis in the real economy accelerated.