The development of Korean economy is very dramatic advancement in world history. After Korean war, Korea was the most poor country who took the support by other countries, now they are one of the most wealthiest country that support the other countries. They are member of OECD, and often invited to G7 sessions. The developmental period of their capitalistic success is compacted in 70 years of time period only which is so-called The Miracle of Han River.
During the 1950s, South Korea was “the poorest, the most impossible country on this planet” which required to be possible country for prosperous development of infrastructure and capitalistic properties. The Korean war destroyed the stability of the population homeless, orphaned, and poverty. GDP per capita was far below 100 USD. President Syngman Rhee failed to do visible development, resigned as corruption.
The next regime was led by South Korean army general Park Chung-hee by the coup. He did the coup of being president of Korea and often blamed when he was army force under Japanese imperialism. It is certain that his determination of South Korean government-leading economic development plans began to economic development, many conservative politicians maintains that his regime as one of the most incredible heritage in Korean economic history.
General Park is not free marketeer policy believer. He rounded up influential businessmen of South Korean companies and proclaimed advantages to them and fostered tax exemption, encouraged entrepreneurship of developing enterprise. The offers were accepted, many enterprises such as Samsung, Hyundai, Daewoo and so on, all of these companies developed their scales worldwide, it was to make South Korean economic brand power improved much dramatically.
Some companies were fined investigationally and with compensation given by Japan were re-invested by the Park government in the projects he had helped to selected companies to develop their worldwide scales. The first five year economic plan laying into the foundations for industrial development 1962 to 1967, and more of the year after the five years, the foster was announced on like fertilizer production, cement, chemicals, oil refining, and textiles.
Daewoo, one of the entry by President Park, into the beginning of shipbuilding business which Daewoo and other Korean shipbuilding companies led out into Korean shipbuilding market share almost 50% worldwide, it was only the beginning of the Miracle of Han River.
The Korean economy was largely occupied by major enterprises. The motto of the occupation was developed by “work hard as one team” and it is based on the characteristic of Korean people who have collaborative manner and Confucius tradition, many people worked hard for enhancement of rate of trade especially export.
While many leaders are naturally corrupted when they are approached the top of the world. President Park himself is evaluated as “not corrupted” during his regime, although his government was led by dictatorship, and “work hard as one team” was largely carried out by sacrifice of workers who had little wages and 3D (dangerous, difficult and dirty) condition of works were undermined, so progressive politicians downgrade the contribution of President Park.
The enterprise culture in South Korea is influential “chaebol” system, not only their contribution of the development, but notorious power abuse in industrial structure. The small companies cannot decide or negotiate contract prices with round table. The chaebol enterprise predetermined prices and forced out to follow it. The stock exchange market too, most of the wealthiest stocks are driven by major big enterprises operated by chaebol. In US enterprise, CEO or establisher of the company could be fired up by committee, but in Korea, such things are impossible because the CEO’s power is like father, and systematically inherited to the family members, stake shareholder system too.
However, President Park’s strategy was largely successful. The export rate excceeded 100 million USD, and his leading development of economies made amelioration to the country enhanced much.
The next president Chun Doo-hwan, another takeover president at 1980s, did continuation of the economical development by protectionism in trade such as rice market.
1980s, Korean economic development rates were more than 7% per year, it was common phenomena in developing countries to the advancement. The astonishing peculiarity in contrast is that it is happened only 30 years from the reconstruction state from the end of Korean War.
After 1990s, South Korean economy was struck by IMF crisis in 1997, but with collaborative and patriotism peculiar to South Korea, 1999, every debt was paid off and currency rate lowered by the crisis, an economic development rates were higher, although such high rates were ended by some years later.
South Korea is technologically advanced country. The populace of smartphone, of HDTV, and of car manufacture have been common A-grade productions. Samsung, Hyundai, SK hynix are frontrunners. There is no Nobel prize winners at science for Korean academics yet, however, Korean development of technological production are received in many favorable reviews, many of them are first grade such as Samsung’s product such as DRAM semiconductor, or Galaxy S series smartphones.
Due to the confrontation against North Korea, South Korean army is very powerful ranked at 5th the most powerful army worldwide. The birth rate is lowered so decreased army soldiers’s population. However, with reserve forces, almost 3 million troops are ready. In connection with technological advancement, weaponary development is also advanced. Recently, South Korea sold armored artilleries were exported to Polland. South Korean light attack aircrafts were too.
The most significant fact of South Korean economy is that they are achieved the development in very compact period of times, so there is peculiarity specialized phenomena in their capitalism.
Now economic development is slowered, and minimal waged people are almost 30% of population, high inflation of house prices, higher unemployment of university degree holders. The government are fostering to social security benefits to young people, many young people established their own start-ups, it is another social problem many start-ups are no by luck.
The product price inflation is quick and frequent. It is because companies need to pay more wages for their employees, and have to make more hire opportunities, the price of product is easy way to improve revenue. The clever remedy to the inflation rate is that companies have their affiliation to consumers to have accumulative discount benefits, for example, accumulative consequences, 4500 KRW is reduced to 900 KRW, as maximum rate of discount.
South Korea has improved immensely as an economy, since 1950s demolition era. Their economy seems prosperous. The South Korean impossibility is now possible dream. They are winners.