Daewoo moved into the construction business, helping to make the new village movement, which was a part of the rural development program in Korea. The corporation was also able to capitalize on the growing markets within the Middle East and within Africa. Daewoo received its GTC designation during this time. Major investment help was provided by the South Korean government to the company in the form of subsidized loans. The competing nations were angered by the strict import controls of South Korea, but the government knew that, without help, the chaebols would never survive the global recession caused by the 1970's oil crisis. Protectionist policies were necessary to ensure that the economy continued to grow.
Even though the government felt that both Hyundai and Samsung had the greater expertise in heavy engineering, Daewoo was forced into shipbuilding by the government. Okpo, the largest dockyard within the globe was not a responsibility which Kim was wanting. He stated numerous times that the Korean government was stifling his entrepreneurial instinct by forcing him to undertake actions based on responsibility instead of revenue. Despite his reluctance, Kim was able to turn Daewoo Shipbuilding and Heavy Machinery into a successful company manufacturing competitively priced oil rigs and ships on a tight production schedule. This took place during the 1980s when South Korea's economy was going through a liberalization stage.
The government throughout this time was lessening its protectionist measures which helped to fuel the rise of small companies 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 government's objective was to shift to a free market economy by encouraging a more efficient allocation of resources. Such a policy was intended to make the chaebols more aggressive in their global dealings. However, the new economic climate caused some chaebols to fail. Amongst Daewoo's competitors, the Kukje Group, went into bankruptcy during 1985. The shift of government favour to small private businesses was intended to spread the wealth which had before been concentrated within Seoul and Pusan, Korea's industrial centers.