Construction cartels and ‘Boneless apartments’ caused by total corruption
If one could compare industries to characters, Korea’s construction sector would be like Dr. Jekyll and Mr. Hyde.
The nation’s building industry is one of the top five in the world in terms of size and skill. Korean contractors have constructed, either entirely or partially, some of the world’s most iconic structures, such as skyscrapers and bridges.
At home, however, the situation is completely different.
In 1970, a five-story apartment building that was recently completed collapsed, killing 33 people. In 1994, a section of a bridge across the Han River fell into the river, leaving 49 dead or injured. The following year, a luxurious department store in Gangnam collapsed, resulting in 502 casualties. The press called it the “heaviest loss of life since the Korean War.”
The cause of the “three major collapses” was the same ― a negligent job in order to save time and money. Corruption and collusion were present from the design to the construction and supervision. The recent collapse of a basement car park ceiling in an apartment complex shows that not much has changed.
According to reports, 15 out of 91 apartment complexes built by the Korea Land and Housing Corp. (LH) had basements with no or far fewer reinforcement bars than specified in the contract. This was extremely dangerous, as the contractors used the flat slab method, with no horizontal beams and only vertical pillars supporting the ceiling. The lack of rebar could have had catastrophic consequences.
It is no coincidence that the construction period coincided with a surge in global commodity prices. People have called the apartments built by the state-run property developer “boneless” or “lean-meat flats.” The government must act quickly to alleviate the residents’ fears. The most urgent task is to prevent potential tragedies by reinforcing or rebuilding these structures. Bureaucrats and politicians must also tackle the industry’s structural issues without delay.
What policymakers and lawmakers are doing now is far from enough.
President Yoon Suk Yeol was right to order an investigation into hundreds of other residential complexes built by private developers. He was also correct in proposing to offer financial compensation to the residents.
However, Yoon made the same mistake of turning a social issue into a political battleground. At a meeting on Wednesday, the president stated that all of the shoddy construction had taken place “before this administration took office.” A ruling party leader called for parliamentary inquiries into the former government’s construction ministers and presidential aides. The previous governing party was quick to respond, claiming that most of the 15 problematic complexes started construction after the current administration took office.
Fifteen months have passed since Yoon took office. Will the incumbent continue to blame his predecessor for anything that goes wrong until his term ends? The construction industry’s chronic problems, such as the excessive curtailment of the construction period and the skimping on materials, have been around for decades. The state-run LH has long been notorious for its “corporate cronyism,” in which incumbent and retired officials benefit each other under a revolving-door employment structure.
The government can start by reforming Korea’s unique apartment trading system, which allows developers to sell homes before they are built. People also flock to new projects in search of “lotto apartments” to make a profit from the difference between pre-construction prices and market prices later. Most speculators don’t care about the quality of the apartments since they don’t live there. It is the end consumers who suffer when something goes wrong. When these apartments remain unsold for various reasons, developers ask the government to purchase them in this “contractors’ paradise.”
Contractors must be aware that their contrasting behavior at home and abroad will have repercussions if foreign customers take issue with their ethical and financial credibility, as experts have pointed out in a Korea Times story.
Instead of fighting for parliamentary elections next April, politicians must pass construction safety laws that have been gathering dust for years.
If all parties involved do their part, the garage collapse may turn out to be a blessing in disguise.
However, watching what the establishment does, Koreans can hardly be sure of such a reversal even four years from now.