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South Korea The Economic Future
The Korea Development Institute also forecasted in 1988 that
South Korea's per capita GNP would exceed US$10,000 early in the
twenty-first century. The institute predicted that Seoul would
enjoy a higher sustained growth rate than average through the
1990s; that the manufacturing industry would play a pivotal role
in the economy in the twenty-first century; and that the service
industry would become knowledge-intensive in order to meet the
needs of a highly diversified industrialized society. The share
of the primary sector (agriculture, forestry, and fisheries)
would sink to nearly 5 percent by the turn of the century,
whereas the secondary sector (industry) would rise to over 40
percent and the service sector would be at about 55 percent.
Major areas of industrial growth would include automobiles,
electronics, and machinery.
In 1988 Kim Duk-choong of Sogang University listed five main
points that were expected to make the "Korean economic future
look bright." He noted that South Korea had drastically reduced
its foreign debts since 1985, greatly increased the rate of
domestic savings, improved on the equitable distribution of
income throughout the population, increased the role of small and
medium-sized corporations in the economy, and made the transition
from a labor-oriented to a technology-oriented economy. He
expected that these positive economic developments would easily
outweigh existing problems and lead to real growth in years to
come.
Kim's optimism had merit, but there were other important
issues that could inhibit economic growth, for example, rising
protectionist sentiments in the United States, Japan, and
elsewhere. Another problem was the fact that the chaebol
tended to restrict subcontracting and to keep as much production
as possible inhouse, which meant that the smaller industries and
businesses, which bore the brunt of slowdowns in Japan, would not
be able to act as shock absorbers. Moreover, as South Korea moved
up the technological ladder, it would face stiff competition from
advanced nations like Japan and up-and-coming nations like
Thailand. There also was the intangible problem of the resolve of
South Korea's workers, who labored six days a week with little
vacation time. What effect would a slackening of resolve have on
the South Korean worker by the 2000? In general, the future of
South Korea's economy looked very bright, but there were enough
intangibles to make accurate predictions difficult at best.
* * *
There are numerous excellent works on the South Korean
economy that offer a variety of perspectives. Historical studies
charting the nation's colonial and modernization periods include
Andrew C. Nahm's Korea under Japanese Colonial Rule and
Ramon H. Myers' and Mark R. Peattie's The Japanese Colonial
Empire, l895-1945. Donald S. Mcdonald's The Koreans
provides information on the Korean economy from colonial times
through contemporary society. Among the general works on the
postwar economy are David I. Steinberg's South Korea's
Economy and Chaebol, Han Sung-joo's and Robert Myers's
Korea, Edward S. Mason et al.'s The Economic and Social
Modernization of Korea, Jene K. Kwon's, Korean Economic
Development, G. Cameron Hurst III's Korea 1988, Alice
H. Amsden's Asia Next Giant, David S. Bell, Jr.'s, Bun
Woong Kim's, and Chong Bun Lee's Administrative Dynamics and
Development, Karl Maskowitz's From Patron to Partner,
and The Rise of the Korean Economy by Byung-Nak Song.
Opposition groups' views of the South Korean economy are best
expressed in Minjungsa's Lost Victory. The Far Eastern
Economic Review publishes frequent articles on the economy,
as does Asian Survey. For a South Korean perspective on
the economy, articles in the English-language Korea
Newsreview and the various publications of the Korean
Economic Institute in Washington are valuable. (For further
information and complete citations,
see
Bibliography.)
Data as of June 1990
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