Geopolitics

Campaigning Ends In Venezuela As Vote Looms To Pick Chavez Successor

EFE; CLARIN (Argentina); LA TERCERA (Chile); EL UNIVERSAL, TELESUR (Venezuela)

Worldcrunch

CARACAS - Campaigns have officially closed in Venezuela ahead of Sunday’s election showdown between the heir to Hugo Chavez’s legacy, Nicolas Maduro and opposition leader Henrique Capriles.

Just five months after reelecting Chavez, the country is being called back to the polls following the death of El Comandante in March. Protests sprung up across the oil rich country during the final week of campaigning, which was required to halt by end of day on Thursday, reports Chilean daily La Tercera.

Polls predict a comfortable win for Maduro, who played to the lingering memories of Chavez, and called upon some famous faces for some last-minute campaigning, including Argentinian soccer superstar, Diego Maradona, writes Clarin.

Capriles was defeated in the October 2012 election against Chavez by some 10%. According to El Universal, Maduro sent a warning to his opponent on Thursday night, saying that should Capriles dare to ignore the results of the election, he will have the same fate as an ex-President who is now in exile in Colombia. “Now he’s toying with the idea of a coup,” Maduro said of his opponent during a visit to pay homage to Chavez.

In terms of electoral promises, writes TeleSur, Maduro declared that he will fulfill Chavez’s legacy, and “rebuild the spiritual fabric of the country.”

Meanwhile, Capriles is the change candidate, says EFE. “On Monday there will be a new Venezuela. On Monday we will embrace the future, one of hope,” said Capriles, who reminded the people during his campaign that Maduro is not Chavez.

This election has generated some rising tension both in Venezuela, and surrounding countries. With its flow of oil revenue, Caracas aids its neighbors financially and after 14 years of chavismo, this could lead to a social breakdown in the region.

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Society

Debt Trap: Why South Korean Economics Explains Squid Game

Crunching the numbers of South Korea's personal and household debt offers a glimpse into what drives the win-or-die plot of the Netflix hit produced in the Asian country.

In the Netflix series, losers of the game face death

Yip Wing Sum

-Analysis-

SEOUL — The South Korean series Squid Game has become the most viewed series on Netflix, watched by over 111 million viewers and counting. It has also generated a wave of debate online and off about its provocative message about contemporary life.

The plot follows the story of a desperate man in debt, who receives a mysterious invitation to play a game in which the contestants gamble their lives on six childhood games, with the winner awarded a prize of 45.6 billion won ($38 million)... while the losers face death.


It's a plot that many have noted is not quite as surreal as it sounds, a reflection of the reality of Korean society today mired in personal debt.

Seoul housing prices top London and New York

In the polished streets of downtown Seoul, one sees endless cards and coupons advertising loans scattered on the ground. Since the outbreak of the pandemic, as the demand for loans in South Korea has exploded, lax lending policies have led to a rapid increase in personal debt.

According to the South Korean Central Bank's "Monetary Credit Policy Report," household debt reached 105% of GDP in the first quarter of this year, equivalent to approximately $1.5 trillion at the end of March, with a major share tied up in home mortgages.

Average home loans are equivalent to 270% of annual income.

One reason behind the debts is the soaring housing prices. In Seoul, home to nearly half of the country's population, housing prices are now among the highest in the world. The price to income ratio (PIR), which weighs the average price of a home to the average annual household income, is 12.04 in Seoul, compared to 8.4 in San Francisco, 8.2 in London and 5.4 in New York.

According to the Korea Real Estate Commission, 42.1% of all home purchases in January 2021 were by young Koreans in their 20s and 30s. For those in their 30s, the average amount borrowed is equivalent to 270% of their annual income.

Playing the stock market

At the same time, the South Korean stock market is booming. The increased demand to buy stocks has led to an increase in other loans such as credit. The ratio for Korean shareholders conducting credit financing, i.e. borrowing from securities companies to secure stock holdings, had reached 21.4 trillion won ($17.7 billion), further increasing the indebtedness of households.

A 30-year-old Seoul office worker who bought stocks through various forms of borrowing was interviewed by Reuters this year, and said he was "very foolish not to take advantage of the rebound."

In addition to his 100 million won ($84,000) overdraft account, he also took out a 100 million won loan against his house in Seoul, and a 50 million won stock pledge. All of these demands on the stock market have further exacerbated the problem of household debt.

42.1% of all home purchases in January 2021 were by young Koreans in their 20s and 30s

Simon Shin/SOPA Images/ZUMA

Game of survival

In response to the accumulating financial risks, the Bank of Korea has restricted the release of loans and has announced its first interest rate hike in three years at the end of August.

But experts believe that even if banks cut loans or raise interest rates, those who need money will look for other ways to borrow, often turning to more costly institutions and mechanisms.

This all risks leading to what one can call a "debt trap," one loan piling on top of another. That brings us back to the plot of Squid Game, "Either you live or I do." South Korean society has turned into a game of survival.

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