Nobody in the world had imagined that the Republic of Korea, in other words South Korea, which is located in East Asia between China and Japan, would grow so quickly after the country was destroyed by the Korean War (1950-1953). The country was divided into two, the North and the South. It did not have any infrastructure, and there were no natural resources at all. The fact that the GNI of South Korea in 1950s was less than that of Ghana is often quoted in many books, such as ‘Culture Matters’ by Samuel Huntington and ‘The Shackled Continent’ by Robert Guest. (In 1953, South Korea’s GNI per capita was only $67.)¹

Now, South Korea is well-known for its rapid economic growth, based on its centrally planned and trade-oriented economic policies. Even though its economy has suffered because of the recent financial crisis and the rise of new developing countries, such as the BRIC nations (Brazil, Russia, India, and China), South Korea has the 15th biggest economy in the world in 2009, according to IMF.

South Korea has changed its status in international society very quickly in the economic sense. However, South Korea still faces many challenges. It needs to expand its role in meeting global standards, such as participating in environmental agreements and contributing aid to developing countries. In addition, North Korea is a big variable to South Korean society. When North Korea provokes South Korea, the South Korean economy is affected immediately, with a rapid drop of its stock market.

In this What Others Think article, South Korean students, NGO leaders, and business representatives provided their perspectives on South Korea society and its place in the world. Interviews were conducted in July 2009, by Sohyeon Kim, a student at Sookmyung Women’s University, Seoul, South Korea.

Economy
Kyu-won Choi, Columbia Law School (LLM Class of 2010), describes her opinions about the South Korean economy.

1. What are the reasons for South Korea’s rapid economic development?

South Korea had a well-organized, government development plan, a benevolent government leader (then-President Park Chung Hee), a well educated & trained labor force that has a strong work ethic, as well as a desire to increase their standard of living.

2. Is Korean economy’s “too globalized’? Does globalization make the economy vulnerable?

Viewing the issue from a global standard, the Korean economy has to go a long way to go to become "globalized". AT Kearny/Foreign Policy ranked Korea the 35th in its globalization index. The World Bank, the Heritage Foundation, and the Transparency Institute also placed Korea between 20th and 40th place in their similar indices.

These institutions note that Korea had too much regulation and too many interventions from the central and local governments. In additon to the regulation, there are many NGOs that oppose globalization or the opening up of domestic economy and some Koreans have anti-globalization perspectives.

As you can see from many foreign exchange crises or financial crises, including Korea's, globalization needs to have orderly and well-organized action plans and preparations. On the other hand, an approach that is too conservative or too cautious will hamper the ability of the country to institute a sound globalization process.  

3. What should South Korea do to overcome the drawbacks of globalization?

Koreans, including all levels of civil servants, need a more 'open mind,' The country needs an orderly de-regulation process and it needs to open its markets and apply global standards.

4. What are expected benefits and challenges associated with a Free Trade Agreement between South Korea and the United States of America?

The benefits include market expansion and the ability to become more competitive, through increased competition.

5. There is a huge anti-FTA movement in South Korea. What are their main arguments?

The main arguments originate from less competitive industries, such as farming (livestock, dairy, etc), who feel that they will be hurt by the process.

Additionally, some employed in the services sector, such as in law, distribution, financing, also believe that they will get hurt a lot when American firms penetrate into Korea's relatively closed markets. They believe that as a result of the FTA, many Koreans will lose their jobs and will be forced to have a lower standard of living; the result will be 'the rich-get-richer and the poor-get-poorer.'

Investment

Joo-young Park, an MA student in Economics from Ewha Women's University, participated in the interview.

1. How much does foreign investment influence to South Korean economy?

The influence of foreign investment on the Korean economy is best reflected by the FDI/GDP ratio. FDI promotion measures starting from 1997, led to remarkable growth of FDI inflows. According to the Bank of Korea, FDI/GDP ratio leaped to 2.56 percent in 1998 from less than one percent; and, it has constantly remained above one percent since then. However, although Korea itself has showed continuous progress in terms of foreign investment attraction, it still records the lowest FDI/GDP ratio of all OECD member nations.

2. What is the impact of foreign investment in South Korea? Is it positive or negative?

FDI inflows were not so noteworthy until the outbreak of economic crisis in 1997, from which the Korean government has actively sought to attract FDI. The amount of FDI inflows increased significantly, and such substantial growth has contributed in enhancing the economic performance of the Korean economy, by creating job opportunities, boosting economic investment, encouraging technological transfer, intensifying competition in the domestic market, and most importantly, by increasing foreign exchange reserves. As a result, the Korean economy was able to recover from the then-severe economic crisis. Since then, FDI inflows have resulted in positive outcomes for the economy.
 
3. Are the South Korean government and society hospitable to foreign investment?

Dating back to 1998, the Foreign Investment Promotion Act (FIPA) was enacted to relieve restrictions on foreign investment, to exempt tax duties, and to reorganize FDI-related infrastructure. Accordingly, it became easier for foreign investors to execute their corporal activities in Korea. Foreign invested enterprises (FIEs) were given numerous incentives, ranging from tax incentives to rental subsidies.

Moreover, the government introduced a cash grant system for foreign ownership, and specific industrial zones were designated to further FDI inflows. However, despite these efforts, foreign investors still assess Korea as less investment-friendly than other neighboring countries such as Singapore, Taiwan, and Hong Kong. They cite rigid labor-management relations, high rental and labor costs, and heavy regulations in the greater Seoul-area as major obstacles to investing in Korea.

Culture

Bo-mi Son, an administrator at Korean culture preservation institute in South Korea provides her perspectives on globalization and culture. (Please note this interview was translated into English from Korean.)

1. What do you think of the impact of cultural globalization?

Namdaemun Market - Seoul South Korea

If I consider globalization as import of other cultures, I think that globalization serves a very basic role of letting people clearly recognize the boundary of our own culture and traditions.
This was the starting point to look back on ‘our culture’ and to find what has been forgotten, by admitting the differences between other cultures and our own culture. Being too globalized will result in only following/imitating other cultures, not identifying our own culture; thus, this will negatively impact both sides. However, a certain degree of globalization is necessary to develop our own culture, through comparing it with different cultures. 

2. What strategies do you recommend to let the world know about Korean culture?
I think that changing the Korean mode is not the real Korean culture. The most traditional and original form can appeal to the people of the world and that is the strongest essence of our culture. Even though the original form should be preserved, we should spread and globalize our culture using modern methods of public relations.

Accepting other cultures without preparation or imposing our culture on others will result in stubbornness to our culture, not globalization. Thus, the foundation for the correct globalization is to understand our traditions, food, clothing, and housing, to modernize our tradition in a way that we can collaborate, and at the same time to translate our tradition correctly and spread it through the precise route.

* Picture: http://www.flickr.com/photos/imcomkorea/2934808052/ 

Environment

Jung-hoon Kim, an employee of Pohang Iron and Steel Company (POSCO), South Korea offers his opinions on climate change and global warming.

1. How is South Korea influenced by the climate change?
 
Climate change influences almost every country around the world, and South Korea is no exception. Climate change, which is originates from global warming, has a huge impact on weather and our daily lives. This year, during South Korea's rainy season, rain patterns have changed (with an uncharacteristic mix of downpours and sunshine).

In addition, our winter is getting shorter, while the summer is getting longer. Looking at all these factors, I could say that these are some of the symptoms of climate change. The damage to our farms are accelerating each year because of these factors.
 
2. How much are South Korean companies, the government and individuals, prepared to cope with climate change?
 
The South Korean government has planned and executed three 3-year plans between 1999 and 2007, and based on this, established the ‘Task Force on Climate Change’ in 2001.

In addition, President Lee presented a 5–year (2008-2012) synthetic counter plan to climate change, which emphasizes "low carbon green growth." The plan also establishes a Task Force on Climate Change, which has published ‘Comprehensive Plan on Combating Climate Change(CPCCC)’. The report recommends activities to reduced carbon in our daily lives, as well as outlines the use of carbon mileage, carbon points.

Major companies are also successively announcing their plans against climate change. For example, POSCO, the biggest steel company in South Korea is making efforts to decrease its greenhouse gas emissions by use photovoltaic power generators and creating a Clean Development Mechanism plan.
 
3. What are the plans or goals of the South Korean government, post-Kyoto?
 
South Korea, which was exempt from compliance with emission limitation under Kyoto Protocol, will certainly be involved in climate change talks post-Kyoto. South Korea's carbon dioxide emissions are the 10th highest in the world and is growing at the fast rate amongst OECD countries.

The South Korean government recently took action on ‘Fundamental Law on Low Carbon Green Growth,’ including the limiting the total amount of emissions, starting an emission trading program, imposing a carbon tax, charge congestion fees, and more.

In addition, South Korea will prepare for post-Kyoto in various ways. South Korea’s plan and goal on climate change is to become voluntarily a carbon reducing country.

* Picture of smog in Seoul: http://www.flickr.com/photos/nagy/4336948/

Energy

Hyung-jin Son, an activist from ‘Green Korea’, expressed his views on South Korea's energy policies. 

1. What is the plan of the South Korean government regarding future energy sources?

‘Green Growth Korea’ plan
Looking into the ‘Green Growth Korea’ plan, which was released in 2008, the government is aiming to increase the use renewable energies. In this report, the government notes that it plans to expand the diffusion of renewable energy, as future energy source and it plans to help foster research and development. The goal is to raise the diffusion rate to 11 percent by 2030 (the diffusion rate was 2.24 percent in 2006.)

Conversion to post-petroleum society
Based on the above report, the South Korean government plans to reduce its dependence on oil from 44.4 precent (in 2005) to 33 percent by 2030. To achieve this goal, the government plans to increase its use of natural gas.

There are plans to expand CNG buses, introduce LNG trucks, develop technologies for a highly-efficient LPG car, and more. To develop and spread the technology of next generation cars, the government will mainly focus on the technology of BTL (Biomass-to-Liquid), CTL (Coal-to-Liquid), BTL (Biomass-to-Liquid).

Selection of 9 concentrating fields
In briefing entited ‘Strategy for Green Energy Industry Development,' the South Korean government noted its decision invest three billion Korean won in nine fields of concentration including sunlight, wind power, LED, electricity IT, hydrogen fuel cell, CTL/GTL, Storage of CCS energy, and IGCC.

2. Do you think it is the best solution?

There are many problems with the government’s national energy plan. If these plans are followed, our energy sources will be petroleum (33%), and nuclear energy (27.8%), coal (15.7%), LNG (12%), and renewable energy (11.5%). The difference between this plan and the current energy is that the use of fossil fuels will decrease from 81.6 percent to 60.7 percent. The use of nuclear and renewable energies will increase as well. The proportion of nuclear energy in the mix will double from 15.9 percent (2006) to 27.8 percent (2030).

The problem with this energy policy is that the dependence on oil is still too high. It is necessary for the government to consider that we import 100 percent of our oil 100 percent, especially when calculating the oil peak and planning to prevent energy shortages.We should simply follow the material from DOE/EIA of United States, regarding the peak oil as 2037.

Also, the government has very positive view of the stability of the energy supply chain and the government insists that there will not be an imbalance of supply and demand. However, considering that the world’s oil price soared to $147.27 USD last year, the supply of oil is already not stable in the world society. Thus, I argue that the government should reflect this international situation more carefully in its plan.

My next concern is about nuclear energy. The plan of the South Korean government is to supply 41 precent of its energy from nuclear power and to accomplish this, it will build 12 more nuclear energy plant by 2022. This is very dangerous idea. In this situation, we have never  dealt with that much atomic waste.

The government is categorizing nuclear energy as clean energy only because it emits less green house gases. Considering the process of exploiting uranium and building plants, the effect of lessening greenhouse gases is suspicious. There is also the possibility of radiation leakage due to natural disasters or accidents. In addition, the cost and social conflict for building nuclear plant will not be easily solved, as the government has planned.

3. If not, what do you suggest?

The most important mistake of government plan is that it does not have any measures for managing energy demand. However, the basic attitude about energy issue is to decrease the use of energy.

Last December, the European Union agreed to ‘EU Climate Change/Engergy Package(20-20-20). The main part of the agreement was to lessen the energy use by 20 percent, in comparison to 1990 levels; to increase the use of renewable energy by 20 percent; and, to reduce CO2 emission by 20 percent. This means that EU considered managing the demand-side as the alternative plan for climate change and energy crisis.

The South Korean government also has to freeze the energy use at this point and create a policy to reduce it. Especially, the expansion of nuclear energy should be reconsidered, in that it enforces the inefficient suppy-demand system of energy.
4. What do you think about the security concern derived from nuclear energy, such as NNPT, regarding North Korea?

I will quote the public statement of ‘Green Korea’ on this issue.

“The Argument on nuclear fuel reprocessing which has bigger cost than benefit”
by Green Korea, July 7, 2009

Last week, Myung-hwan Yoo, the minister of Ministry of Foreign Affairs and Trade the necessity of nuclear fuel reprocessing mentioning about peaceful usage of nuclear energy and yesterday(July 6, 2009) MOFAT and related ministries defined their plan to revise Korea-USA Nuclear Agreement, and Jin Park, the representative of Foreign Affairs, Trade and Unification Committee announced to compose ‘Diplomatic Strategy for Peaceful Use of Nuclear Energy(tentative name)’....

Nuclear fuel reprocessing is inappropriate for mainly two reasons.

First is the safety problem. The safety of fast-breeder reactor is not proved yet, and still it is remaining on the step of laboratory nuclear reactor. Some people in this industry say that the realization will be in the very near future, but this is unreliable self-interest. This has very low possibility just like nuclear fusion.

Second, South Korea’s nuclear fuel reprocessing will make North Korea to formulate its possession of nuclear weapon regarding the East Asia’s dynamics. This will also promote Japan’s nuclear armament. Thus, South Korea’s nuclear fuel reprocessing will trample the contemporaries’ hope to secure peace.

Development

Jae-gwang Han, a representative of ODA Watch (the ODA monitoring group) gave his opinion on the South Korea's contributions to international aid.
 
1. Please explain how South Korea can change its status from an aid recipient to an aid donor?

South Korea achieved independence in 1945, but went through the Korean War in 1950, and then experienced difficulties under a military dictatorship. However, based on continuous economic development, we achieved political democratization and human rights development. During this period, South Korea received $12.78 billion USD as aid from the international society.

In 1987, South Korea finally became an aid donor by establishing the Economic Development Cooperation Fund (EDCF), for credit assistance; in 1991, Korea founded the Korea International Cooperation Agency (KOICA) to provide  grant aid. In 1996, Korea became a member of the OECD and, in 2010, it will join the Development Assistance Committee (DAC).

2. Do you think South Korea is contributing successfully to the global society, as a donor country?

Since South Korea started giving credit assistance and grant aid, it has consistently increased the amount of aid. Nonetheless, the amount of aid has not reached the amount that world society recommends (0.7 percent of GNI.) South Korea gave $797 million in 2008, which is 0.09 percent of GNI, and only a third of the average amount given by OECD/DAC countries.

This is too small comparing to South Korea’s economic scale. In addition, South Korea’s aid is not following the global trend, in that the proportion of credit assistance is bigger in South Korea, compared to other developed countries. Thus, it is necessary that South Korea aid should increase systematically in quantity and quality.

3. If, not what should be improved first?

First, Korea should increase its amount of aid. The government’s plan is to deliver 0.25 percent of its Gross National Income in foreign aid, but we need to raise the amount of aid by quite a bit in order to reach that point.

Second, the quality of the aid, which includes the type of recipients and the type of aid, has to be improved. By increasing the rate of grant aid, we have to follow the real meaning of aid; we should lend more support to least developed countries, as needed.

Third, we need to amend the system of laws regarding aid. In South Korea, more than 30 organizations are delivery aid. Thus, I think systematic consolidation should be done for more effective aid.  So, we need to pass a government act that formulates the government aid.

Fourth, we need to increase recognition of our aid program within South Korea. Many South Korean citizens  have a negative feeling towards increasing aid, especially because of the economic crisis. We have to increase domestic support.

Migration

Min-jae Kang discusses her perspectives on North Korean defectors' to South Korea. 

Demilitarized Zone (DMZ) between South Korean and North Korea

1. What are South Korea’s main immigration problems? 

North Korean defectors: North Korean defectors’ legal and illegal entry into the country has been a great burden to the South Korean government in numerous ways. North Korean defectors are often not categorized as refugees, despite their escape due to political oppression, as well as lack of food.

Illegal defectors go through countless challenges as they have to veil their identity in 3rd countries like China and Thailand in order to prevent repatriation to North Korea. Even those who enter legally into South Korea face obstacles such as adjusting to a new society and environment, fighting discrimination, hiding from North Korean spies, as well as coping with the fear of punishment for their family members left in North Korea.

The constitution of South Korea defines North Koreans as part of their citizens, nonetheless, North Koreans in South Korea are an undeniable social and political problem. 

2. What are the barriers to solving those problems?

Cooperation and dialogue with North Korean government is not an option, since the defectors are viewed as traitors and political criminals in North Korea. The South Korean government has a limited budget to cover the expenses of providing good living conditions and education for the defectors. The situation also has provoked increased political tension between the two Koreas. The general social consensus is not open or positive toward North Korean defectors, and some even view them as enemies.

3. Is the South Korean government taking these problems seriously?

The South Korean government is reluctant to provide affirmative protection to this vulnerable social group. Hanawon provides education and training for the defectors, but this is a short-term program that is problematic; it is too short to provide adequate preparation to transition into a distinctively new society.

Bills have been proposed to extend the length of Hanawon education, but the adoption of the bills is still questionnable. Two-thirds of the Hanawon trainees are women. Needless to say that women and children are among the most vulnerable groups. Special care and educational training for women and children are a prerequisite for them to fight against potential threats, discrimination and abuse they will face in South Korean society.

4. What will be the impact of the issue in the future of Korean society?

More than 3,000 North Korean defectors entered South Korea in recent years. This has a great impact on the population of South Korea and as a social phenomenon itself. The issue of North Korean defectors is not only significant in proving South Korea’s constitutionality, it also is important in how South Korea positions itself against international standards of human rights.

It is very regretful that South Korea does not have a clear idea of how to protect North Koreans, its self-claimed citizens. South Korea needs a firm position in the international arena to address the needs of this vulnerable group, who leave their country because of serious human rights infringements.

* Picture: http://www.flickr.com/photos/gin_e/157879753/