The Strength of Seoul: Asia’s Rising Economy



What SPELL turned Asia’s small agrarian peninsula into the most urbanized and advanced society? Let me unfold the tale of the “Land of The Morning Calm


A simple observation:

It may never have appeared to our observation, but we came across numerous Korean products in our day-to-day life. Listing from the nail-clippers to the refrigerator in the house; from the television set to the small toys to play with. Names like SAMSUNG, LG were household names. As more time passed, even more names came into existence: HYUNDAI, KIA MOTORS, PSY; all of which were based in South Korea. Did it ever pique your curiosity or did you ever look up for these names?


Flipping Through the Pages of History:

South Korea is situated in the southern part of the Korean peninsula. The land, together with the North Korea peninsula, formed the large Korean peninsula. The history of Korea had been rich until the annexation and colonization of Japan in 1910. It was a dark blot in the pages of Korean history. The Japanese left Korea in 1945 after their crushing defeat at the end of world war II. But that was not all. The end of the great war brought a division into the peninsula. The 38th parallel was set to be the dividing line between north and south Korea. Ever since then, the two countries have come a far way.


The Newly Transformed Nation:

Now as marching forward towards the present, a giant leap is observed. The once colonized country; later turned into a battlefield; now sits at the 10th position in GLOBAL GDP INDEX. The country is now home to few of the biggest conglomerates, best education system in the world, advanced citizens and much more glory.


What was the secret formula behind their huge and steady success?


The secret behind their success is undoubtedly their incessant hard work and precision. Various studies have showed that South Korea’s structural transformation to policy reforms aimed at opening the country to foreign markets has attributed to its growing economy. The export-oriented policies of South Korea are one of the most important factors in its success.


The simplest answer to this question would be: strong will power and the courage to make right choices. South Koreans are respected around the world for their rigorous hard work. They make use of every possible moment. Is that all? No, if one were to analyse their statistics, one would surely praise their quick wit. A few decisions made in the nick of time have now proved to be fruitful over time.


The export business:

  • The Asian Financial Market Crisis of the late 1990s affected many markets adversely. The crisis, however, caused the south Korean economy to form wide-ranging reforms. The aim was then focused to make the country more resilient to regional a global shock. The import substitution policy, which was a part of import tariff aided in much of early growth.

  • The export business plays a crucial role

  • The economy continues to be driven by the share of national output, the core of which is the manufacturing industry.

  • South Korea relies largely upon exports to fuel the growth of its economy, with finished products such as electronics, textiles, ships, automobiles, and steel being some of its most important exports.

The foreign Trade Value:


Source: World Trade Organisation (WTO); Latest available data


The House of Chaebol:

Let us focus our attention back to the beginning of discussion. Remember about Samsung and Hyundai, well let’s dive into it. The Chaebol are the families or owners who run large industrial conglomerate. With passage of time, they have become pillars of the South Korean Economy; have relied on close cooperation with the government for their success: decades of support as subsidies, loans, and tax incentives. The top five, taken together, represent approximately half of the South Korean stock market's value. (SAMSUNG GROUP, LG CORPORATION, HYUNDAI MOTOR GROUP, SK GROUP AND GS GROUP)


There are over a hundred Chaebols in South Korea; the revenue generated by them is over 4490 million dollars. Chaebols also play a quite significant role in the politics of South Korea.


Film and television:

You can escape to any part of the world, but you won’t be able to escape K-pop and drama.


The Korean(hallyu)wave has taken the world by storm. Be it musicians like PSY, BTS, BLACKPINK, EXO or artists like LEE MIN HO, JUNG JI HYUN and KIM SOO HYUN; their popularity is widely spread and widely acknowledged. The revenue generated by the entertainment industry is huge. The film and television industries are estimated to have directly contributed 7,549billion Won South Korean GDP in 20111. They also directly supported 67,600 jobs and generated some 3,752 billion Won in tax revenues.


Thus, the generated Korean wave has also boosted various aspects of Korean economy.


The South Korean Tourism being a major attraction. The tourists spot like Namsan tower, Jeju island, aesthetic cafes, amusement parks; which are widely advertisement in films and dramas; attract a novelty of people. Tourism alone accounted for 4.7% of GDP and was estimated to support almost 1.4 million jobs, representing 5.3%of total employment.


Jeju Island in South Korea


Easier said than done, the history of South Korea has proved to the world that with determination and hard work can turn dreams into reality.


 

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