The government has hinted it could intervene to save Korea's biggest urban development project, which has collapsed because the developer has defaulted on its debt.

Cheong Wa Dae spokesman Yoon Chang-jung told reporters on Thursday that the Ministry of Land, Transport and Maritime Affairs would "come up with a response."

So far the government had maintained a hands-off policy.

But another government official said no specific orders have been given yet.

Meanwhile state-run rail operator KORAIL, the biggest shareholder in the W30 trillion (US$1=W1,108) project, decided to pump in emergency cash and gain the rights to the property, turning it into a public project.