Essay on Korea

2154 Words 9 Pages
Korea

What distinguishing factors help explain the rapid economic growth experienced by the South Korean economy over the past four decades?
As the South Korean economy has reached a more mature stage of its economic growth, what are the evolving challenges it has had to face?
What are its prospects of continued economic success in the increasingly globalised world economy?

The rapid growth and development in the newly industrialising economies (NIE’s) in recent decades has been nothing short of spectacular. Now among the world’s most dynamic industrialised economies, the NIE’s of Singapore, Taiwan Hong Kong, and South Korea which will be the focus, stand as perhaps the best examples of successful economic development. The economic
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Over the last 30 years the share of manufactures in total exports has increased from 12% to 95%. Furthermore the manufactures exported have themselves changed with more advanced products, led by electronics dominating the list of major exports and hence the importance of the Samsung and Lucky Goldstar to the Korean economy. The direction of trade has also changed somewhat, where South Korean exports went largely to the USA and imports came from Japan, Asian countries excluding Japan are now South Korea’s major trading partners. The importance of China is also becoming of increasing significance.

South Korea’s economic success as noted can also be contributed to the high levels of savings and investment. South Korean’s save about 35% of GNP and thus sustainable economic growth has been driven by capital stock accumulation and expanded productive capacity. Indeed some figures show up to 60% of economic expansion in South Korea is a result of capital accumulation and increase infrastructure.

Undoubtedly one of the most important rationalisations for economic success is effective government intervention. Selective government intervention has promoted the development of new industries, many of which have become internationally competitive and also supported and advanced

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