Chung’s pitch to the British financial establishment in the autumn of 1971 was, by every reasonable measure of the available business case, absurd. South Korea had no shipbuilding industry. Hyundai had no shipbuilding experience. The proposed shipyard site, photographed in the document Chung was carrying, was a stretch of empty coastline with no infrastructure, no port facilities, no skilled workforce, no supply chain. The Korean economy at the time had a per-capita GDP of approximately $300, lower than that of Ghana or the Philippines, and was substantially dependent on American foreign aid. American banks had previously refused to finance the project. Japanese banks had refused. The British shipbuilding industry, which Chung had selected as his next target on the assumption that the country with the longest commercial shipbuilding tradition in Europe might prove more open to lending him the approximately $43 million he needed, was itself in a period of substantial commercial decline. There were, in essential respects, no plausible reasons for any British financial institution to advance $43 million to a 55-year-old Korean construction executive who proposed to build the largest commercial shipyard in the world on a stretch of empty Korean coastline.
According to the official corporate history maintained by HD Hyundai’s Heavy Industries division on the company’s founding and the 1971 financing negotiations, the British intermediary who actually opened the door for Chung’s financing was Charles Longbottom, then chairman of A&P Appledore — a substantial British shipbuilding consultancy that had advised on shipyard design and construction projects across multiple countries during the previous two decades. Chung met Longbottom in London in September 1971. The meeting was, by Longbottom’s own subsequent recollection, not going particularly well — Longbottom had expressed essentially the same scepticism that the American and Japanese bankers had expressed, namely that Korea had no shipbuilding industry, no precedent for the proposed scale of construction, and no obvious commercial basis for the project Chung was proposing. At which point Chung reached into his pocket and removed the 500-won banknote.
The turtle ship argument
The banknote Chung produced depicted the geobukseon — the turtle-shaped Korean warship designed by Admiral Yi Sun-sin during the Imjin War of the 1590s, fitted with iron-plated armour, propelled by 80 oarsmen, armed with cannons protruding from its sides, and used to devastating effect against the Japanese naval invasion forces in a sequence of engagements between 1592 and 1598 that subsequent Korean historiography has treated as one of the foundational episodes of the Korean national identity. Chung’s argument to Longbottom, as the British executive later recounted to the BBC, was structurally simple. The United Kingdom had built its first ironclad warship, HMS Warrior, in 1860. Korea had built ironclad warships in the 1590s — approximately 270 years earlier. If Koreans had been capable of building functional ironclad naval vessels in the late 16th century, when British naval construction was still essentially wooden, the proposition that Koreans could not build modern oil tankers in 1971 required a substantial demonstration of evidence that Chung was not prepared to accept.
Longbottom found the argument persuasive — or, at minimum, persuasive enough to provide the formal recommendation letter that Chung needed to approach Barclays Bank with institutional cover. As detailed in UPI’s 54th anniversary coverage of the founding of HD Hyundai and the financing arrangements Chung secured in 1971, Barclays Bank subsequently approved a $43 million loan, conditional on Chung’s securing actual ship orders before the financing was disbursed. Chung then travelled directly from London to Athens, where he persuaded the Greek shipping magnate George Livanos to place an order for two Very Large Crude Carriers (VLCCs) of 259,000 deadweight tons each — to be built at a shipyard that did not yet exist, by a company that had never built a ship, in a country that had no shipbuilding industry, on a beach that was still empty when Chung produced the photograph of it for Longbottom’s inspection. Livanos placed the order. The Barclays loan was disbursed. Hyundai Shipbuilding & Heavy Industries was founded in March 1972. The groundbreaking ceremony at Ulsan was attended by South Korean President Park Chung-hee, by senior members of the Korean government, and by the ambassadors of several countries whose financial institutions had declined to lend Chung the money the previous year.
What the empty beach became
The construction schedule Chung committed to was, by the standards of contemporary international shipbuilding, impossible. As reported by Encyclopedia.com’s biographical entry on Chung Ju-yung and the founding of Hyundai’s shipbuilding business, the conventional approach to building a major shipyard was to construct the shipyard first, complete the dry docks, install the heavy equipment, train the workforce, and only then begin construction of the first vessel — a process that conventionally took approximately five years before any commercial deliveries could be made. Chung rejected the conventional sequence. Hyundai built the shipyard and the first ships simultaneously, with Korean workers assembling the dry docks around the keels of the partially-constructed tankers that Livanos had ordered. Two years and three months after the March 1972 groundbreaking, in June 1974, Hyundai delivered the Atlantic Baron — the first of the two Livanos VLCCs — directly from a shipyard that had not existed when its construction had begun. The Korean shipbuilding industry, which had not existed in 1971, had produced its first commercial vessel in 1974.
The expansion across the subsequent decade was, by every available measure, the most rapid growth of a national shipbuilding industry in modern industrial history. Per Facts and Details’ summary of Hyundai’s industrial history and Chung Ju-yung’s broader business trajectory, the Ulsan shipyard grew from the original two dry docks to one of the largest industrial facilities of any kind in East Asia. Hyundai Heavy Industries was producing 30 million tons of ships per year by the early 1980s. The company became the world’s largest single shipbuilder in 1983 — eleven years after the original groundbreaking, twelve years after Chung produced the turtle ship banknote in Longbottom’s office. The empty stretch of beach in the photograph Chung had carried to London had, across the same eleven-year period, become the city of Ulsan — a designated industrial development zone that now houses the headquarters of Hyundai Motor, Hyundai Heavy Industries, and approximately one million people, the substantial majority of whom are employed, directly or indirectly, by the various subsidiaries of the corporate empire that the rice-store bookkeeper from a now-North Korean village had constructed across the previous half-century. Chung died in March 2001 at the age of 85, having seen Hyundai grow into a chaebol of 86 companies covering essentially every major industrial sector of the Korean economy. The HD Hyundai conglomerate, the largest direct successor to the shipbuilding business Chung founded in 1972, has a current combined market capitalisation of approximately $121 billion and remains, as of 2026, the largest shipbuilding operation on Earth. The 500-won banknote with the turtle ship on it was withdrawn from Korean circulation in 1973. Multiple framed copies of it hang on the walls of the HD Hyundai corporate offices in Ulsan today.
