Daewoo moved into the construction sector, helping to make the new village movement, that was a part of the rural development program in Korea. The corporation was also able to take advantage of the growing markets in the Middle East and within Africa. Daewoo received its GTC designation during this time. The South Korean government provided major investment support to the company in the form of subsidized loans. South Korea's strict import controls angered competing countries, but the government knew that, without help, the chaebols would never endure the global recession caused by the oil crisis during the 1970s. Protectionist policies were required to ensure that the economy continued to grow.
Even if the government felt that Samsung and Hyundai had the better knowledge in heavy engineering, Daewoo was forced into shipbuilding by the government. Okpo, the largest dockyard in the globe was not a responsibility that Kim was wanting. He stated many times that the Korean government was stifling his entrepreneurial instinct by forcing him to undertake actions based on responsibility instead of earnings. Despite his reluctance, Kim was able to turn Daewoo Shipbuilding and Heavy Machinery into a successful company producing competitively priced ships and oil rigs on a tight production schedule. This happened during the 1980s when the economy within South Korea was experiencing a liberalization stage.
The government in this time was reducing its protectionist measures which helped to fuel the rise of small businesses and medium-sized companies. Daewoo had to rid two of its textile corporations at this time and the shipbuilding industry was beginning to attract more foreign competition. The objective of the government was to shift to a free market economy by encouraging a more effective allocation of resources. Such a policy was meant to make the chaebols more aggressive in their worldwide dealings. However, the new economic conditions caused some chaebols to fail. The Kukje Group, among Daewoo's competitors, went into liquidation in the year 1985. The shift of government favour to small private businesses was intended to spread the wealth which had before been concentrated within Korea's industrial centers, Pusan and Seoul.