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Wednesday, 14 January 2009

Desperate times

SEOUL - EVOKING memories of the 1997 financial crisis, many South Koreans are selling gold jewellery - even their wedding rings - amid the economic downturn, merchants said on Wednesday.

Twelve years ago, they were responding to a government appeal to help pay off the national debt. Now they are trying to repay their own debts.

'Amid the severe economic slump, they are selling gold rings and other jewellery to make up for loss of income or to repay in instalments bank loans they took out to buy houses,' said one shopkeeper in Seoul's Jongno district.

Unlike before, when sellers were from all age groups, many now are in their early 30s.

Often they sell gold rings traditionally given to children to mark their first birthday, said the shopkeeper who identified himself only as Kim.

'Those who are in the most desperate situation even sell their wedding rings. One day, I dared ask a male customer why he was selling their wedding rings and he almost burst into tears,' he said.

He and other jewellers said their own business had been hard hit by the economic recession and the surge in gold prices.

'There are many more sellers than buyers as gold prices have more than doubled over the past two years,' Moon Min-Soo, president of Pagoda Jewelry Shop in Jongno, told AFP.

'Compared with two years earlier, our sales have dropped by half,' he said.

Kang Seung-Gi, CEO of Diks Diamond, said the company had started offering free appraisals of jewellery to an increasing number of sellers.

'As economic woes deepen, increasing numbers of consumers are seeking to cash in their idle assets including jewellery,' Eom Gil-Gheong, a business commentator, told journalists.

Dong-a Ilbo newspaper said hard times are changing the country's extravagant wedding culture.

Many grooms used to give brides rings, earrings, necklaces and bracelets.

Now more couples are exchanging wedding rings only, it said. -- AFP

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