Has chaebol economy reached its limit?

seoul — once a driver of growth and a source of national pride, south korea’s family-led conglomerates are becoming instead objects of public scorn as a massive corruption scandal puts them under mounting pressure to reform.

the indictment of the heir to the samsung empire, lee jaeyong, and four of his colleagues on charges of bribery and embezzlement was the latest setback for the world’s biggest smartphone maker.

south koreans were glued to their television screens as lee, handcuffed and bound in ropes over his well-tailored suits, repeatedly appeared before prosecutors for questioning last week.

but the wide-ranging scandal that has seen president park geun-hye impeached has also called into question the future of the chaebols, as the familyoriented groups that dominate asia’s fourth-largest economy are known. in december, millions watched in astonishment as the heads of the country’s eight largest chaebols were publicly chastised at a parliamentary hearing over millions of dollars of “donations” their companies made to dubious foundations controlled by park’s secret confidante choi soon-sil.

lee and the other tycoons, including the leaders of hyundai, sk, lg and lotte, all denied providing funds in return for favours — but suggested they regularly came under pressure to do so from high-level political circles.

many in the crowds at weekly protests against park in seoul target their ire at the companies as well as the politicians, as economic and social frustrations mount.

“this is becoming like a chaebols’ republic. they are becoming too greedy and too powerful,” kim jong-rae, a 49-year-old life insurance company employee, told afp. in the past, chaebols contributed to the country’s fast economic growth, he said, but as the founders’ sons and grandsons took over, they expanded into every corner of business. —