SOver the past 27 years, South Korea has tried not to be a cautionary tale for developing countries – and has largely succeeded. Since the 1997 Asian financial crisis, the country has strengthened its foundations, raised living standards and seen its businesses flourish around the world.

Then came President Yoon Suk Yeol’s crazy martial law stunt, returning South Korea to the role model of what not to do that it had escaped.

Within six hours on Tuesday and Wednesday, Yoon shocked the global community of democracies by suspending common law. And for bizarre reasons that politicians in Seoul still cannot understand. There is talk of mysterious “anti-state” forces that sympathize with North Korea.

Most assume Yoon acted in part out of desperation that the opposition had scuttled his party’s legislative ambitions. Yoon seemed to bet that martial law would allow him to put his plans into action. But the answer should have been to move to a different, more moderate policy. Or to develop a new legislative strategy. Not quite visiting Kim Jong Un in Seoul.

Count the ways the gambit backfires, not just the good chances that Yoon will be indicted.

One of them is that Yoon proved the investors behind the “Korea discount” right. He simply confirmed their feeling that Korea Inc. is less ready for global prime time than many thought. Yoon also reminded the world of past episodes of Korean military rule – dating back to 1948 – that a number of South Korean governments have worked very hard to move past them.

When investors think of martial law enforcers in Asia today, they think of Indonesia, Myanmar, the Philippines, Thailand and now South Korea. That is quite a legacy, President Yoon.

Another legacy will soon come into focus: the way Yoon’s desperate plan will literally wipe out Asia’s fourth-largest economy.

Technically, Korean Finance Minister Choi Sang-mok may end up being right in dismissing fears that Tuesday’s botched martial law decree will help tip the economy into recession, dismissing them as “exaggerated.” At least that’s what he told Bloomberg News on Thursday. Of course, Choi could also be wrong if Yoon’s actions have a lasting impact on the confidence of companies and investors.

The real question, however, is the coming years. Even before this week’s antics, South Korea was facing a difficult 2025. With China slowing and exporting deflation and Donald Trump returning to the White House, policymakers in Seoul certainly had their hands full on Monday. But on Tuesday, prospects that the South Korean government would act quickly to protect the economy from what was to come faded.

If Yoon survives impeachment — a big if — his legislative prospects will be infinitely slimmer. Not only will he be in the lame-duck zone, but also in an area where the government can be forgotten.

Of course, the first half of Yoon’s five-year term, which began in May 2022, was anything but a reformist whirlwind. He has accomplished little to nothing in reducing near-record household debt levels that are undermining consumer spending. Nor has he worked to increase productivity or reduce the extreme concentration of power of a handful of family corporations or chaebols that dominate the economy.

Yoon scored no significant victories on the scoreboard to address gender inequality, halt the decline of what is already the lowest birth rate ever, or reduce the economy’s over-reliance on exports for growth. These pre-existing conditions are already bad enough to be looking at a completely uncertain 2025. They are likely to become even worse due to the complete legislative paralysis in Seoul.

Chronic complacency has long been a challenge for South Korea. Yoon’s five predecessors, who have been together for 20 years, have all committed to improving the country’s economic situation. Each new government that came to power took a look at the chaebol-dominated South Korean model, recognized the amount of work needed to redesign it, and moved on to other pursuits. Like clockwork, each leader left the Bank of Korea the task of managing the trade-dependent economy.

None of this ensures that Korea is headed for a lost decade like Japan. But this pattern of complacency, coupled with this week’s events, increases the odds.

Had Yoon used the last 941 days wisely to increase competitiveness and a level playing field, South Korea might be better positioned to deal with China’s slowdown and U.S. President-elect Trump’s impending trade war. The heavy price of Yoon’s selfish martial law debacle will be paid in installments over time by South Korea’s 51 million people. How’s this for a cautionary tale?