Economic Development
of the Republic of Korea
Contents
1 2 3 4 5
The Korean Economy Now
The Process of Economic Growth in Korea How Korea Dealt with the Economic Crisis Korean Companies
Future Growth Engine and Policy Direction
The Korean Economy Now
The Korean Economy Now
Korean Economy Now
1) Semiconductor
Sales Ranking; 1st Samsung, 3rd SK Hynix (Source: IC Insights’ Strategic Reviews database)
2) 5G Network;
Samsung and LG competing with Qualcomm, Ericsson, and Huawei
3) Shipbuilding Industry
Hyundai and Daewoo
4) Smartphone Ownership and Internet Usage Rate:
95% of the adult population (Source: Pew Research Center)
Leading Technology
The Korean Economy Now
Innovation
The Korean Economy Now
No.1 for the sixth year in a row
* An index measuring multidimensional facets of innovation-driven growth, providing 80+ detailed metrics such as human capitals and infrastructure
A Simple Question & Quiz
The Korean Economy Now
Economic Growth Rate
GDP
(billion USD)
GDP per capita (USD)
Income inequality (Gini Coefficient)
Bloomberg
Innovation Index
South Korea 2.7% 1,619.4 31,346 0.355 89.00 (1st)
France 1.6 % 2,775.3 42,878 0.291 80.99 (11th)
Italy 0.7 % 2,072.2 34,260 0.328 65.57 (24th)
Canada 1.8 % 1,711.4 46,261 0.307 71.58 (19th)
Germany 1.5 % 4,000.4 48,264 0.294 83.92 (3rd)
Australia 2.7 % 1,418.3 56,352 0.330 73.33 (18th)
Spain 2.6 % 1,425.9 30,697 0.341 62.51 (29th)
The Process of Economic
Growth in Korea
From Ruins
to Economic Powerhouse
The Process of Economic Growth in Korea
1950s (66~81) 1960s (80~216)
1970s (253~1,713) 1980s (1,703~5,738)
1990s (6,514~10,404) 2000s (11,951~19,152)
2010s (23,083~33,346)
GDP Per Capita (USD)
State-Led Development Plans
Export / Large Companies- Oriented Policies
Investment in Human Resources
Strong Work Ethic
Two Koreas after Korean War
The Process of Economic Growth in Korea
• GDP and GDP per capita
(source: KOSIS & Bank of Korea)• Electricity Consumption (unit: kWh per capita)
(source: KOSIS & World Bank)1971 1983 1992 2014
South Korea 296 1,141 2,826 10,497
North Korea 909 1,134 1,024 600
Korea’s GDP Ranking
The Process of Economic Growth in Korea
• GDP per capita Ranking
(source: World Bank)1965 1975 1985 1995 2005 2015 2018
Ranking 105 79 48 33 34 29 28
GDP per
capita (USD) 106 608 2,458 12,340 18,658 27,513 31,345
• GDP Ranking
(source: World Bank)1980 1985 1990 1995 2000 2005 2010 2015 2018
Ranking 28 20 16 11 12 10 14 11 11
GDP (Bil. USD)
83.3 167.9 322.3 544.7 773.4 1,094.8 1,473.7 1,856.7 2,136.3
• Successful developmental state State-led industrial policies Industrialized economy
• “Capitalism with Democracy” achieved in 1987
• Economic growth remained steady since the 1990s due to democratic political stability
• Industrial transformation: Following other developed countries’ path and formulas
Developing Country and
Industrial Development/Sophistication
The Process of Economic Growth in Korea
Light Industry
Heavy Industry
Service Industry
Tech/Capital Intensive Industry
Large Companies / Export-Oriented Policies Personnel Development Strong Work Ethic
From ODA* Recipient to Donor
(Official Development Assistance)The Process of Economic Growth in Korea
A Simple Question & Quiz
The Process of Economic Growth in Korea
How Korea Dealt with
the Economic Crisis
• Hard to maintain its economic growth
Due to mounting foreign debt, opaque financial market, volatile labor market, collusive links between politics and businesses
Overcoming the Crisis
How Korea Dealt with Economic Crisis
Gold Donation Campaign in 1997 (Source: Chosun-Ilbo)
•Asian Financial Crisis in 1997
(GDP growth rate in 1998: -5.5%)
Industrial restructuring & reform measures by the newly-elected ruling party + efforts of ordinary people
A Simple Question & Quiz
Overcoming Process of the Korean Economic Crisis
Consolidated Democratic Political System
Efforts of Business Circles
Efforts of Ordinary Citizens
Korean Companies
Top Technologies
• Conventional Heavy Industry
Mechanical Automobile, Shipbuilding, High-speed Train, Infrastructure
• Electronics
Home Appliances (e.g. LG), Semi-Conductor (e.g. Samsung)
• Information Technology
Smart Phones and AI-based Appliances (e.g. Samsung’s Galaxy) Digital Banking (e.g. K-Bank, Kakao Bank)
Mobile Communications (e.g. 5G) Internet of Things (“IoT”)
Technological Development
• Technology Transfers
• Investment in Human Capital
• Government’s Strong Commitment
The 4th 5-Year Basic Plan for Science and Technology (2018)
Bio-Health-Medical Energy-Resource ICT-Software
Construction- Transportation
Environment-
Climate Machine-
Manufacturing
Agriculture- Aquarian-Food
Space-Aero-
Marine Material-Nano
Defense Disaster Safety
A Simple Question & Quiz
Future Growth Engine and Policy
Direction
Developing Next Growth Engine
• Gearing up for the new industrial era in the face of the 4th Industrial Revolution technologies and structural changes
Future Growth Engine and Policy Direction
(Source: Parametrix)
“Innovative and Inclusive Economy”
• Less and less regulatory red tape
• More investment in the 4
thindustrial revolution and future-oriented technologies
• Sustainable growth with more redistributive welfare systems O vercoming the previously excessive free-market capitalist policies
• “Human-Centered” economic development
Preventing inhumane economic practices to ensure ordinary citizens’ basic quality of life
Future Growth Engine and Policy Direction
Final Question
Future Growth Engine and Policy Direction
Bio-Health Care
Infrastructure and Construction
Roads, Highways, Railways, Electricity, Communication, Smart city
Conventional Labor-intensive Factories
Information Technology
Conventional
Tech-/Capital-intensive Factories
Education Tourism,
Duty-Free Industry, and Beauty Industry
Cultural Industry
K-Pop/Drama/Movie
