Gdp of south korea by years. Economic South Korea. Service sector of South Korea

A small country in Northeast Asia with the most innovative economy continues to develop successfully. Despite their geographical size, in terms of GDP, South Korea and Russia are neighbors in the world rankings. Moreover, a smaller country has a stronger economy.

Economy overview

The country with a developed capitalist economy occupies a leading position in the world in many indicators, including ease of doing business (5th place) and innovativeness (1st place). In 2017, South Korea ranked 11th in the world in terms of GDP with $1.53 trillion. In terms of GDP per capita (27023.24 dollars), the country is in 31st place in the world ranking.

The leading sectors of the country are the automotive, petrochemical, semiconductor and steel industries. The country has long since entered the post-industrial phase, with the predominance of the non-material sector of the economy. In the structure of South Korea's GDP, 59% falls on the service sector, 39% on production and 2% on agriculture. The government encourages businesses to develop and implement fourth industrial revolution technologies, especially in terms of artificial intelligence, robots and telecommunications equipment.

International trade

The country owes its economic success, first of all, to international trade. The country's enterprises are focused on the production of products that have good export potential in recent years, especially those with high added value. South Korea is in the top 5 countries - exporters of high-tech products. In terms of total exports, the country is also in 5th place, in 2017 its volumes amounted to 577.4 billion US dollars.

The top Korean goods for sale in the foreign market are: integrated circuits ($68.3 billion), automobiles ($38.4 billion), petroleum products ($24.8 billion), and passenger and cargo ships ($20.1 billion). Top export destinations: China, USA and Vietnam. Import volumes in 2017 amounted to $457.5 billion. The country buys most of all crude oil ($40.9 billion), followed by integrated circuits ($29.3 billion) and natural gas ($14.4 billion). Most of the goods are purchased in China, Japan and the USA.

Volumes of the economy

In the 50s, the main share of South Korea's GDP came from agriculture and light industry, in the 70s and 80s - from light industry and consumer goods, and in the 90s - from the service sector. During the period from 1970 to 2016, the volume of services produced in the country increased by $516.5 billion (297 times).

South Korea's GDP topped US$1 trillion for the first time in 2010. Over the next seven years, the indicator grew by more than 50%, reaching $1,530 billion in 2017.

Below is a table showing the GDP South Korea by years.

These statistics perfectly show how successfully the country is developing in the economic sphere.

Economic growth rates

After the global economic crisis in 2008, South Korea's GDP growth rate in 2009 fell to 0.3%. In 2011, the country has already reached a good level - 3.7%, which is quite a high figure for a developed economy. This was facilitated by a good market situation for the country's main export commodities, including shipbuilding, automotive, engineering products and household appliances. From 2012 to 2016, South Korea's GDP growth slowed down due to problems in the external market. Increasing competition in the electronics and automobile markets, a drop in income in the markets for metallurgical products and in shipbuilding had a negative impact on the country's economy.

In 2017, for the first time since 2014, the country's economy managed to overcome the 3% barrier, reaching a level of 3.1%. In a three-year perspective, the South Korean government intends to achieve a GDP indicator of 4%. The breakthrough occurred primarily due to the excellent market conditions for semiconductor elements and memory cards.

South Korea is a highly developed industrial and agricultural country, whose industry has shown good growth dynamics over the past few decades. Thanks to this, the economy of South Korea developed rapidly. Using the example of this country, the answer to the question of whether a state with an uneducated poor population that does not have gas, oil and other minerals can become prosperous sounds in the affirmative. The Korean experience has a number of key features that confirm the possibility of gradually building a knowledge-based economy.

Features of the economic and geographical position

The Republic of Korea (RK) is located on the Korean Peninsula (east of Eurasia) in its southern part. The territory of the country is washed by the waters of the Yellow and Japan Seas.

As a result of the division of the peninsula into two states, traditional economic ties between the agrarian south and the industrial north were disrupted. Then one of the basic parts of building the economy of the Republic of Korea was cheap labor resources.

The new economic complex of the country was formed on the basis of insignificant stocks of its own raw materials, imports of oil, gas, metals and its own agricultural products.

In general, the provision of Kazakhstan with natural resources looks like this:

• Land resources. There are few lowlands suitable for agriculture in the country. They are located mainly in river basins and along sea coasts.
• Water resources. The rivers of South Korea are characterized by a short length. The largest - Yongsong (713 km) - flows into the Yellow Sea.
• Forest resources. There are few forests left in the Republic of Korea today. Various types of hornbeam, elm, ash, linden, maple and oak grow in them. Ginseng cultivation is a state monopoly.
• Minerals. The country is poor. Therefore, the modern economy of South Korea is almost completely dependent on the import of minerals from abroad. Only 3.5% of the coal mined from its depths has a calorific value exceeding 5,200 kcal/kg. Iron ore reserves are also small - 128 million tons. Significant for the industry is the Sandong tungsten deposit in Gangwon Province. Its ore reserves are estimated at approximately 34 million tons.

In the early 1980s, the country's government carried out large-scale economic reforms. In particular:

• frozen state budget
• reduced money supply growth;
• tough taxation measures.

And by the end of the 1980s, South Korean conglomerate companies began to seriously compete with Western ones. Since then, the country has been systematically conquering the world market.

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Characteristics and structure of the economy

The South Korean economy today, although showing growth, is less than in 2019. According to the forecasts of the well-known agency Moody’s Corporation, the value of this indicator in 2019 will be 2.3%, while at the end of the previous year it reached 2.7%. But it is expected that already in the next year - 2020 - the negative dynamics will be replaced by positive ones: growth will be 2.5%.

According to the agency's analysts, the situation with a slowdown in 2019 is associated with a drop in demand for semiconductors, which, in turn, led to a decrease in exports of products produced by the South Korean electronics industry.

The development of "chaebols" (South Korean forms of industrial and financial groups) in the 20th century ensured high growth rates for the country's economy. At the same time, the hierarchical structure of these conglomerates restrained internal competition.

Nevertheless, the Government of the Republic has made notable progress in developing a set of basic legal, social and political rules aimed at regulating the activities of economic entities. This is evidenced by the data of the Doing Business rating, which characterizes the ease of doing business: the Republic of Korea in 2019 took 5th place. In total, there are 190 states on this list.

• 2nd place in ensuring the execution of contracts and connecting residential facilities to power supply systems;
• 10th place - in obtaining permits for construction;
• 11th place - in registration of institutions and resolution of insolvency.

In other components of the index, South Korea ranks from 23rd to 60th.

In the context of the question, what kind of economy is in Korea in terms of susceptibility to external influences in the foreseeable future, one should know the size of the public debt. According to the results of the previous year - 2019 - it increased by $18 billion and reached a record high of $598.9 billion.

At the same time, the level of public debt relative to GDP is low - 38.2%. For comparison: this figure in the United States in the middle of 2019 is 109.45%.

The government of South Korea stressed that the multibillion-dollar state debt does not threaten the stability of the country's economy. The fact is that in 2019 the budget showed a surplus of $28 billion. And the public debt increased due to the placement of bonds by the Ministry of Finance.

The structure of the South Korean economy includes the following main industries:

• petrochemistry;
• steel industry;
• automotive industry;
• electronic industry;
• shipbuilding.

Republic of Korea GDP

At the end of 2019, the South Korean Ministry of Finance predicted that the country's GDP for 2019 would be $1,929 trillion.
But, according to the calculations of representatives of the Goldman Sachs bank, a drop in this indicator by 0.4% is not ruled out in the event of a 10% reduction in semiconductor production in the country.

Such a scenario of development of events may take place, since from 07/01/2019 Japan extended the ban on the export of materials to the Republic of Korea, without which it is impossible to produce semiconductors. If the actual figures coincide with the forecast data, South Korea's GDP growth in 2019 will be the lowest in the last 7 years.

Forming of budget

The budget of South Korea for 2019 provides for an increase in government spending at the highest pace since 2009 - 9.7%. In absolute terms, the government will spend 470.5 trillion won (nearly $400 billion) this year.

The size of GDP for the main sectors that fill the state budget is presented in the table. It displays data as of the end of the first quarter of 2019.

Industry name	GDP as of March 2019
	won, billion	dollars, million
mining sector	523	443.86
Manufacturing sector	119813	101683
Agriculture	8483	7199
construction industry	21885	18573
Transport	15230	12925
Services sector	215014	182478
Department of Housing and Utilities	11601	9845
Sphere of public service	26576	22555

The main parameters of the Korean model of economic development are:

• careful approach to the preparation of labor resources;
• active involvement of sources of savings;
• export orientation.

The main condition for the successful functioning of such a model is the combination of market mechanisms with state planning. Actually, thanks to the implementation of this principle, we are witnessing the South Korean economic miracle.

What is produced in the Republic of Korea for export

Since the peculiarities of the economy of the Republic of Korea include the orientation of production to export, let's pay attention to the country's success in this area. Another record was set a few days before the start of the current year 2019. Then, for the first time, exports exceeded $600 billion.

South Korea began selling its products abroad in 1948. The start was modest - the volume of sales amounted to only 19 million dollars. But annually, exports increased by an average of 16.1%. $100 billion worth of goods were first sold to other countries in 1995.

Consider what South Korea currently produces for export:

China imports the most goods from South Korea - it accounts for almost 30% of South Korean exports.

Components of the economy of the Republic of Korea

South Korea today occupies the 11th place in the world ranking in terms of economic development. According to forecasts, in 2023 its GDP will be equal to 2.055 trillion dollars.

Banking system of the country

The banking system of the Republic of Korea includes financial institutions of three main categories:

• Bank of Korea. Performs the functions of a central bank. It is endowed with exclusive rights to issue banknotes and coins, which have the status of legal tender for all financial transactions in the territory of the state.
• commercial banks. These include:
  • 14 national commercial financial institutions;
  • 110 regional banks;
  • 72 branches of foreign credit institutions.
• specialized banks. This category includes the Industrial Bank of Korea and a number of other institutions. They are engaged in financial support for the activities of enterprises in specific sectors of the economy - industrial production, fishing, foreign trade and agriculture.

In addition, non-banking organizations, such as venture funds and insurance companies, also operate in the financial sector of the South Korean economy.

Industry Priorities

The industry of South Korea is supported by the state. Particular attention is paid to the automotive and shipbuilding industries. In order to stimulate growth in these key industries, the government intends to allocate 15 trillion won ($12.77 billion) in 2019 to financially support auto parts manufacturers, as well as medium and small shipbuilders.

Adhering to the course of development of innovative technologies, the Republic of Korea plans to develop the aerospace industry in every possible way. According to a representative of the Korea Aerospace Corporation, this organization intends to increase the volume in this segment of industrial production to 20 trillion won (17.02 billion dollars) a year by 2030.

Significant funds are also planned to be directed to the development of new types of energy and industries that combine the industry of advanced materials and information and communication technologies. In 2019, the financing will be provided by the Korea Export-Import Bank in the amount of 9.5 trillion won ($8.09 billion).

Agriculture and fishing

The main branch of agriculture in the Republic of Kazakhstan is crop production. 23% of the territory of South Korea is subjected to cultivation, while 1/3 of arable land is irrigated.

Grains are harvested about 7.5 million tons, and they prevail in the gross harvest. They grow ramie, cotton, legumes, and hemp. Also, agriculture in South Korea is characterized by developed horticulture and horticulture.

The main agricultural crop of the Republic of Korea is rice. Approximately 80% of farmers cultivate it. Consume grain of rice mainly within the country.

But of the grown fruits, more than half is sold abroad.

In animal husbandry, the following figures appear:

• the number of pigs reached 9 million;
• cattle - about 2 million heads;
• birds - over 100 million.

Fishing is an important part of the South Korean economy. About 140 thousand people are employed in the industry. Approximately 100,000 vessels are used for fishing. Cultivation of molluscs is carried out in nurseries. A significant part of seafood is exported. Russia is also among the importing countries.

Transport system

Public transport in South Korea is the subway, buses and taxis.

We note one feature: a free transfer is allowed up to 4 times from one bus route number to another and from any bus route to the metro.

The Seoul Subway operates from 5:00 am to 10:00 pm. To pay for trips, it is most advantageous to use a T-money card. It costs 2,500 won ($2.13). You can top up your balance in the metro or in the supermarket where you bought the card. It operates not only in the subway, but also in buses throughout the country.

City buses have an advantage: they move in their own lane, marked with a blue line. There are no traffic jams on it, so you can always get to your destination on schedule. By the way, intercity buses also run on a minute-by-minute schedule.

Traveling by taxi in South Korea is relatively inexpensive. The countdown for boarding starts at 3,000 won ($2.55). From this amount, the first 2 km are paid. For each subsequent 150 meters of travel, the fare increases by 100 won ($0.09). Payment is made both in cash and with a bank card.

Service sector of South Korea

The service sector of the Republic of Kazakhstan includes catering establishments, entertainment enterprises, sports organizations, medical institutions, laundries, saunas, hotels. This industry accounts for up to 2/3 of GDP.

In July 2019, the Government of the Republic of Korea approved a new strategy for the development of the service sector. Its priority sectors were identified and decisions were made:

• on correcting outdated administrative mechanisms that hinder job creation and attract investment;
• on measures aimed at improving remote medicine services.

The government also plans to introduce changes to the taxation system, as a result of which tax incentives will be provided to enterprises from the service sector. According to the calculations of the authorities, the combination of these measures will increase the level of economic growth on an annualized basis by 0.2% already in 2020.

Features of tourism

Korea, with its rich historical and cultural heritage, picturesque nature, rivers, mountains and beaches, is one of the most interesting countries in Southeast Asia in terms of tourism.

The share of tourism in South Korea's GDP in 2019 was 2.8% ($44.5 billion). The dynamics of changes in this indicator in absolute terms over the past 24 years is shown in the graph.

The sharp growth in 2011-2013 is due, among other things, to the development of medical tourism infrastructure in the country.

The most popular sights of the Land of Morning Calm:

• Gyeongbokgung Palace (located in Seoul)
• Seoul Tower (erected in the capital on Mount Namsan);
• Bukchon Folk Village (located in Seoul);
• Namison Island (Chuncheon City, Gangwon-do Province);
• Garden of Morning Calm (Gyeonggi Province, Gapyeong County).

Employment of the population of South Korea

The results of 2019 published by the National Statistical Office indicate that the total number of employed people was 26.82 million people. Compared to 2017, this is 97 thousand more.

This growth is the lowest since 2009. The employment of the population of South Korea amounted to 60.7% of the total number of able-bodied residents and decreased by 0.1% over the previous year. The number of unemployed reached 1.73 million people or 3.8% of the working population. This is the highest value of this indicator since 2000.

In the last month of 2019 alone, the number of jobs in the retail trade decreased by 63 thousand, and in the manufacturing sector, due to the restructuring of a number of automotive enterprises and the decline in the shipbuilding industry, by 127 thousand. Against this background, it is discreetly optimistic that unemployment among young people under the age of 30 decreased by 0.6% compared to 2017 and amounted to 8.6%.

According to government forecasts, the country's population will begin to decline in the next 7 years. And taking into account the fact that the labor resources of the eleventh economy in the world will become smaller every year, the prospects for the development of South Korea are not so bright. Actually, this problem is relevant for 80% of the G20 states.

We note one interesting point. It was said above that Japan limited the supply of rare materials for the electronics industry to the Republic of Korea. The reaction of the people of Korea to these measures was immediate: they called on their compatriots not only to boycott Japanese manufacturers, but also to refuse tourist trips to Japan.

But there are also examples of South Korea's trade relations with neighboring countries improving. Thus, in 2019, an increase in the South Korean-Chinese trade turnover by 13.7% was recorded. At the same time, the volume of exports from the Republic of Korea to China amounted to $50.3 billion.

Comparative characteristics of the economies of Korea and Russia

The IT sector and other high-tech industries are rapidly developing in South Korea. In Russia, almost 4/5 of all science-intensive industrial production is concentrated in the nuclear and aerospace industries, as well as military-oriented industries.

Let us briefly note the parameters that bring together and distinguish the economies of the Republic of Korea and the Russian Federation.

South Korea is a state run by corporations. The state apparatus in this country exists and functions to serve the population, as well as business, but not vice versa, as is observed in domestic realities.

Conclusion

The economy of the Republic of Korea is actively developing. Successful reforms carried out at the state level contribute to the constant growth of GDP and, as a result, improve the lives of people living and working in the country.

The industry is focused mainly on the production of products for deliveries abroad. To stimulate such activities, the government has taken a number of measures. In particular, taxes were reduced for companies and enterprises engaged in export production.

As of mid-2019, South Korea is ranked 11th in the world in terms of economic development.

Since the 1960s, South Korea has gone through years of incredible economic growth and global integration to become a high-tech industrialized economy. Four decades ago, GDP per capita was comparable to that of the poorest countries in Africa and Asia. In 2004, South Korea became a member of the club of countries with a GDP of more than one trillion dollars, and is currently among the 20 largest economies in the world. Initially, this success was made possible by a system of close communication between government and business, including directed credit and import restrictions. The government stimulated the import of raw materials and technology for the production of consumer goods and encouraged savings and investment in consumption.

With the onset of the Asian financial crisis of 1997-98. weaknesses in South Korea's development model emerged, including a high debt-to-GDP ratio and massive short-term foreign borrowing. As a result, South Korea's GDP in 1998 fell by 6.9%, but thanks to the successful actions of the country's government in 1999-2000. GDP grew by 9% annually. South Korea has carried out numerous economic reforms since the crisis, which included creating greater openness to foreign investment and imports. In 2003-2007 South Korea's GDP growth rate has declined to around 4-5% annually. Due to the global economic crisis that began in late 2008, South Korean GDP growth slowed to 0.2% in 2009. In the third quarter of 2009, the country's economy began to recover largely due to the growth of exports, low interest rates and expansionary tax policies, and economic growth in 2010 has already exceeded 6%.

Long-term problems for the South Korean economy include a rapidly aging population, an inflexible labor market, and an overdependence of manufacturing on exports.

History and current state of the economy of South Korea

By the Second World War, Korea came up as one of the poorest countries in the world with a predominantly agrarian economy. The post-war devastation and the Korean War did not contribute to the sustainable development of the country's economy. Syngman Lee's government relied on economic assistance from foreign countries, in particular the United States. The national economy of the country was in decline, the incomes of the population were very low.

After the division of Korea into two parts - the DPRK and South Korea - the long-standing ties between the agrarian South and the industrial North collapsed. South Korea lost such industries as metallurgical, chemical, cement. In the south, mainly enterprises of the light and food industries were concentrated.

The Korean War completely undermined the country's economy. After the end of the war, the allies of the South, with the assistance of the government, developed a plan to assist the South Korean economy. The US provided about $1.5 billion in subsidies and "development loans" between 1954 and 1959 (loans totaled $12.4 million). This money was mainly spent on the purchase of American food and consumer goods, only a small part went to the restoration of the industrial infrastructure of industry and agriculture. However, in the early post-war years, American aid contributed to a relatively rapid economic recovery. The average annual growth rate of the gross national product in 1954-1958 amounted to 5.2%, and the manufacturing industry doubled its production during these years.

By the beginning of 1958, the number of unemployed and semi-unemployed was about 4.3 million people (36.6% of the total working population of South Korea).

Since the early 1960s, the Korean economy has developed rapidly. Over three decades (from 1962 to 1989), the gross national product increased by an average of 8% per year, rising from $2.3 billion in 1962 to $204 billion in 1989. The median annual income of the population rose from $87 per person in 1962 to $4,830 in 1989. The share of the industrial sector in 1962 was 14.3% of GNP, and in 1987 - 30.3%. The volume of trade in consumer goods increased from $480 million in 1962 to $127.9 billion in 1990.

The most significant factor in accelerating the development of the country's economy was the economic policy of the new President Park Chung Hee, who directed the government's efforts to attract foreign investment, increase exports and industrialize the economy. The state began to play a more prominent role in the economic life of society. Elements of a planned economy began to be introduced - five-year economic plans.

During the development of light industry from 1962 to 1971, foreign investment amounted to $ 2.6 billion, mainly in the form of loans provided to the government and the private sector. Having staked on the industrial sector of the economy and the country's export-oriented development strategy, the country's government has artificially increased the gap between industrial and agricultural areas in the economy.

By the early 1970s, however, the country's industrial sector was in trouble. Prior to this, the national industry produced cheap products using cheap labor, which increased the competitiveness of South Korean goods and stimulated protectionist policies from other developing countries. The government responded by increasing funding for the heavy and chemical industries and investing in capital-intensive and high-tech sectors of the economy.

The structural transition to a capital-intensive industry has been difficult. The situation was complicated by the fact that in the late 1970s there was a global energy crisis, which led to an increase in oil prices and limited the volume of South Korean exports. In 1980, the South Korean economy experienced a temporary crisis: for the first time since 1962, the national economy showed negative growth, and inflation increased.

In the early 1980s, the country's government launched wide-ranging economic reforms. Conservative monetary policy and tough fiscal measures were adopted to curb inflation. Money supply growth was limited from 30% in the 1970s to 15%. The budget was briefly frozen. Government intervention in the economy has been greatly reduced, and more free conditions have been created for foreign investors. In order to narrow the gap between the city and the countryside, the government has increased investment in projects such as road construction, communication networks, and village mechanization.

These measures, along with the general recovery of the world economy, helped the South Korean economy to reach its previous level of growth already in the second half of the 1980s. In the period from 1982 to 1987, the economy grew by an average of 9.2% per year, and in the period from 1986 to 1988 - by 12.5%. Inflation, which in the 1970s was in double-digit percentage terms, was brought under control, the prices of consumer goods increased by an average of 4.7% per year. Seoul achieved a significant increase in the balance of payments in 1986, and the balance of payments in 1987 and 1988 amounted to $7.7 billion and $11.4 billion, respectively. This rapid development helped South Korea reduce its external debt.

In the late 1980s, the domestic market became the backbone of economic growth. Growth in demand for cars and other expensive goods has greatly increased due to the general increase in the solvency of the population. As a result, the government's economic policy, previously aimed at exporting Korean goods, changed towards self-sufficiency, which led to a decrease in dependence on other states. Especially in those years, the service sector developed rapidly.

The 1990s were marked by the close integration of South Korea into the world economy (in the mid-1990s it became a member of several international economic organizations) and the rapid growth of the population's income. However, by 1990 it became clear that the high growth rates of the 1980s would slow down. Economic growth in 1989 was only 6.5%. In the first half of the 1990s, the pace did not slow down, on the contrary, there was a slight recovery - with an increase in investment and exports, economic growth increased from 3% in 1992 to 8.6% in 1994 and 8.9% in 1995. Gross national product per capita rose to $10,000 in 1995, and in 1996 unemployment reached an unprecedented 2%. Inflation remained relatively stable at 4% per year.

The stable economic development of the South Korean economy was interrupted in 1997 along with the global economic crisis. In October 1997, the won began to depreciate sharply against the dollar. By November 21, 1997, the country's gold and foreign exchange reserves were almost completely depleted, and in order to prevent a complete collapse of the economy, the government was forced to make large loans from the International Monetary Fund.

A series of measures taken by the government, including a series of economic reforms, allowed South Korea to emerge from the crisis fairly quickly. Already in 1999, economic growth was 10%, and in 2000 - 9%.

The slowdown in world economic growth and the fall in exports in 2001 affected the South Korean economy: in 2001, growth was only 3.3%. However, already in the following year, 2002, the economy reached the level of growth of 6%. The restructuring of large companies (chaebols), the privatization of banks and the general liberalization of the economy are the main areas of work of the country's government. In 2004, the outlook for the economy did not look as good as a few years before. Active trade with China, however, has become a good factor for the development of South Korea.

At the moment, the South Korean economy is based primarily on the production of consumer goods such as electronics, textiles, cars, as well as on the heavy industry sector: shipbuilding, steel production. The products of these industries are the main export item. Despite the fact that the import market has become freer in recent years, the agricultural sector is still under protectionism due to a serious discrepancy in the level of prices for agricultural products, such as rice, domestically and in the world. In 2005, the price of rice in South Korea was five times higher than in the international market. At the end of 2004, however, an agreement was reached with the World Trade Organization to gradually increase the share of imports in the rice market in the country - by 2014, imported rice should account for 8% of the total amount consumed. In addition, up to 30% of imported rice must go to final consumers (prior to this, imported rice was used mainly for the production of various food and beverage products such as soju). By 2014, the rice market in South Korea should be fully open.

The economic crisis of 2008-2010 had a strong impact on the South Korean economy. In 2008, the decline in industrial production in the country amounted to 26%, unemployment increased, the won against the dollar significantly decreased. During 2009, the country's economy gradually recovered, helped by the government's anti-crisis program and the depreciation of the won in 2008, which created favorable conditions for Korean exporters. Growth accelerated in 2010, after the beginning of the recovery of world markets that are consumers of South Korean goods, in particular, in the first quarter of 2010, the forecast for annual GDP growth was 5.2%, and unemployment fell from 4.4% to 3.8%.

South Korea's economy, as of 2009, was 14th in the world in terms of gross domestic product (purchasing power parity) and 15th in the world in terms of nominal GDP. Gross national product per capita rose from US$100 in 1963 to over US$28,000 in 2009.

Economic policy of South Korea

In 1961, General Pak Chung Hee overthrew the regime of Prime Minister Chang Myung. The main direction of his actions in the economic sphere was the transformation of the country from a backward agrarian to a modern industrial one. Since his reign, South Korea's economy has experienced explosive growth.

The Park Chung Hee administration decided that centralized government should play a key role in economic development. The structure of the economy that emerged as a result of government measures included elements of both state capitalism and free trade. It was during the reign of General Pak that chaebols appeared in the country - large private conglomerates engaged in various activities. Thus, the government retained ownership of the railways, electricity sources, water supply, roads and ports.

Large-scale nationalization was carried out. The entire banking system came under state control. A number of measures were taken to improve the situation in the agrarian sector (in 1961, the peasantry made up 58% of the population). Thus, the ruling group freed the peasants from paying debts on usurious interest, adopted a program to stabilize prices for agricultural products, increased the percentage of payments on bank deposits, which also stimulated the flow of free funds to banks and made it easier to obtain loans, and other similar measures were taken.

The main economic goals of Park Chung Hee's government were to strengthen key industries, reduce unemployment, and develop more efficient management practices. Measures were aimed at increasing the level of exports, which meant strengthening the competitiveness of South Korean goods and labor productivity. The key industries were electronics, shipbuilding and the automotive industry. The government strongly encouraged the opening of new industries in these industries. As a result of these measures, the growth of industrial production was 25% per year, and in the mid-1970s, the rate increased to 45% per year.

The main problem faced by Park Chunghee's government in the early 1960s was the widespread poverty of the population. It was also necessary to increase state reserves in order to stimulate industrial growth. Domestic savings of the state were very small. As a result, the government began to actively borrow money from other states, as well as create tax incentives to attract foreign capital to the country. Of all the rapidly developing countries in the Asia-Pacific region - Taiwan, Hong Kong, Singapore and South Korea - only the latter financed its economy mainly with the help of external borrowing. In 1985, the country's external debt amounted to $46.8 billion. Foreign investment came mainly from Japan and the United States.

The government was able to mobilize the country's domestic capital through a flexible investment incentive system that differs for different industries and their export potential. The government has also been able to restructure many industries, such as the military-industrial complex and construction, often stimulating or dampening competition.

After the formal end of the Korean War, foreign assistance became the most significant source of resources for economic recovery. Much of what was left of the factories built by the Japanese during colonial rule had either been destroyed by the war by the mid-1950s or badly outdated. The rest passed into private hands. It was during that period that large industrial conglomerates began to take shape in South Korea, later called chaebols. These groups of companies involved in trade, manufacturing, and services still dominate the South Korean economy.

The emergence of chaebols favorably affected the increase in exports from the country. In 1987, the four largest chaebols generated $80.7 billion in revenue, which accounted for two-thirds of the gross national product. In the same year, the Samsung group generated $24 billion in revenue, Hyundai $22.7 billion, Daewoo $16 billion, and Lucky-Goldstar (now known as LG) $18 billion. The next largest chaebol, Sunkyong, generated $7. .3 billion. The top ten chaebols accounted for 40% of all bank loans that year, 30% of the country's industrial value added, and 66% of all South Korean exports. The five largest chaebols employed 8.5% of the country's total labor force and created 22.3% of all industrial production.

Since the 1960s, the country's economic program has been based on five-year economic plans. The first five-year economic plan (1962-1966) included the initial steps towards building an efficient industry. Emphasis was placed on the development of such industries as the production of electricity, mineral fertilizers, the petrochemical industry, and the cement industry. The second five-year plan (1967-71) envisaged the modernization of industry and the development, first of all, of industries capable of producing products that had previously been imported: steel production, machine building, and the chemical industry. The Third Five-Year Plan (1972–76) was marked by the rapid development of an export-oriented economy, primarily in the heavy and chemical industries, including mechanical engineering, electronics, shipbuilding, and oil refining.

In the fourth five-year plan (1977-81), the country began to produce products that are competitive on world markets. The strategic directions included science-intensive high-tech industries: mechanical engineering, electronics and shipbuilding, and the chemical industry. As a result, the heavy and chemical industries grew by 51.8% in 1981, the share of exports in production increased to 45.3%. The fifth and sixth five-year plans reduced the emphasis on heavy and chemical industries and shifted it to high-tech production: electronics, semiconductor industry, information technology. The Seventh Five-Year Plan (1992-96) and subsequent Five-Year Plans continued this direction.

Financial and banking system of South Korea

Financial institutions in South Korea can be divided into three main categories: the central bank, individual banking organizations, and non-banking organizations such as insurance companies, venture capital funds, etc. The foundations of the modern financial system in South Korea were laid in the early 1950s, when a number of regulatory documents regulating the activities of the banking system were adopted.

Most of the non-bank financial institutions emerged during the 1970s with the aim of diversifying financial resources and stimulating the circulation of money in the country, as well as to attract investment. Since the 1980s, several commercial banks and non-banking financial institutions have been involved in a program to accelerate the liberalization and internationalization of the economy. The total number of branches of commercial banks in June 2004 was 4,448. Sole ownership of bank securities was restricted in 1982. The limit was 8% in 1982 and was tightened to 4% in 1994. However, in 2002 this was again raised to 10%.

Specialized banks began to be created in the 60s of the XX century. They were mainly formed to support key sectors of the economy (according to five-year economic plans). Now specialized banks work mainly with agriculture (National Agricultural Cooperative Federation), fishing (National Federation of Fisheries Cooperatives), foreign trade (Export-Import Bank of Korea), industry (Industrial Bank of Korea), etc.

The Central Bank of South Korea was founded on June 12, 1950. Its main function is to issue the national currency, determine the monetary and credit policy, control the foreign exchange rate, study and collect statistics on the country's financial system, and regulate the activities of private banks. The Bank of Korea provides loans to the government and is the conductor of the government's activities in relation to the country's banks. All South Korean banks maintain their creditworthiness through the Central Bank of Korea.

Investments in South Korea

In South Korea, the volume of foreign trade in 2005 was 70% of GDP, and the income of companies that invested from abroad accounted for almost 14% of the sales of the entire industry. The South Korean government is directing efforts to attract foreign investment to the country. The most recent example is the opening of the world's largest LCD complex in Paju, just a few kilometers from the Demilitarized Zone. The largest investors in the South Korean economy are the US, Japan and the UK.

In order to make the country's economy more attractive to foreign investment, the government has taken a number of measures, among which should be noted the adoption of a new regulatory document - the Foreign Exchange Transaction Act. These measures were divided into two phases for two years. The main goals are the liberalization of capital and the modernization of the currency exchange market. In May 1998, the ceiling on foreign investment in South Korean stocks without a fixed dividend was abolished. Since May 25 of the same year, foreigners can buy shares in any South Korean company without the permission of the board of directors (with the exception of military-industrial complex companies and public associations). Foreigners can purchase up to 50% of the cost of public associations.

In April 2002, the government presented plans to develop the foreign exchange market in order to create a more investment-friendly environment in South Korea. The certification procedure by the Central Bank of the country was abolished and the document flow was simplified when making financial transactions. The movement of capital has become freer.

Industry of South Korea

For the period from 1976 to 2006, the average growth of the gross national product was 9%. The share of industrial production in the country's economy rose from 21.5% in 1970 to 28.9% in 1997. The largest industries are electronics, shipbuilding, automotive, construction and textiles.

Automotive industry. Hyundai's concept car. In South Korea, the automotive industry accounts for 9.4% of total value added, 8.3% of all exports, and employs 7.4% of the country's workforce.

The start of production was laid in the early 1960s, when the first five-year economic plan was adopted. Since then, the South Korean automotive industry has become one of the most important sectors of the economy, showing high growth rates. Now South Korea is the world's fifth largest car manufacturer (its share is 5.4% of world production). The country has five major automotive manufacturers - Hyundai Motor, Kia Motors, GM Daewoo Auto & Technology, SsangYong Motor Company and Renault Samsung Motors.

In 2002, more than 3.1 million cars were produced in the country, in the same year, sales in the local market amounted to 1.62 million cars, which is 11.8% more than in 2001. Exports remained at the same level (1.5 million cars). In 2010, the South Korean government planned to increase production to 4.25 million vehicles per year and exports to 2.1 million vehicles per year.

Shipbuilding. Shipbuilding includes the construction, repair and conversion of all types of ships and vessels. South Korean shipbuilding is currently one of the key industries and a basic factor in its development, as it also pushes forward related industries - metallurgy, the chemical industry, electronics, etc.

The construction of shipyards began its growth in the 1970s. In 1973, Hyundai Heavy Industries completed construction of its first shipyard. Daewoo Shipbuilding and Marine Engineering commissioned its first dock in 1978, followed by Samsung Heavy Industries in 1979. Now these three companies are the largest in the country in this sector of the economy. Moreover, Hyundai Heavy Industries is the largest ship manufacturer in the world.

In the 1980s, shipbuilding continued its explosive growth. South Korea has become the world's second largest manufacturer of ships and ships. Only in the second half of the 1980s did South Korea's world market share rise from 10% to 25%. The industry experienced qualitative growth in the 1990s. Labor productivity increased and new technologies accumulated. As a result, in 2002, the Korean shipbuilding capacity of the country was estimated at 6.8 million CGT. The share of complex and expensive vessels, such as large-tonnage container carriers and oil tankers, as well as gas carriers, has grown strongly. Purposeful specialization led to the fact that Korea came close to gaining the status of a monopoly manufacturer of expensive ships - in 2005 its share in this segment of the world shipbuilding market reached 59.3% (for comparison: Japanese companies in this niche have 25.3% - almost double smaller). Thus, in 2005, Korea increased its share in the market of large-capacity oil tankers by 6% - up to 42.4%, and its share in the manufacture of vessels for the transport of liquefied natural gas increased by 0.1% and amounted to 71.35%.

In 2005, South Korea received orders to build 339 vessels with a total tonnage of 14.5 million CGT, or 38% of the global portfolio. In 2004, Korea's share of new orders was 36% - 441 ships (16.9 million CGT).

Engineering. Mechanical engineering, in addition to shipbuilding and automotive industry, can include the production of engines and turbines, metalworking tools, mining and agricultural equipment, refrigeration and chemical equipment, etc.

Mechanical engineering was hit harder than other sectors of the economy by the 1997 crisis. The production and domestic consumption of the industry's products almost halved in 1998, mainly due to a sharp outflow of investments and the bankruptcy of many enterprises. At present, the industry has not yet fully recovered from the consequences of the crisis, but in 1999 the volume of production amounted to 24.7 million dollars, which is 25.3% higher than in the previous year. Imports also decreased - in the first post-crisis year, they fell by 53.4%. In 2002, output stood at $38 billion (pre-crisis 1996, $43 billion), with an average growth rate of 10% between 2000 and 2002. The volume of imports in 2002 amounted to $21 billion (18.2% annual growth). Most of the imports came from Japan - 40%. The volume of exports in 2002 amounted to 13 billion dollars (annual growth of 8.3%).

Metallurgy. The South Korean steel industry weathered the 1997 crisis relatively easily, reaching pre-crisis production levels as early as 1999.

Raw steel production increased from 38.9 million tons in 1996 to 41 million tons in 1999, making South Korea the world's sixth largest steel producer. The share of metallurgy in the overall structure of the economy also increased, reaching 7% in 1998. The share in value added increased to 5.9%. Overall demand for steel products grew by 11.7% per year from 1996 to 1999 and by 6.9% from 2000 to 2002, reaching 53.8 million tons in 2002. Domestic demand grew at an even faster pace, at 12.4% per year from 1998 to 2002. In 2002, steel production reached 51.1 million tons.

petrochemical industry. Despite the fact that the South Korean petrochemical industry is quite young (its development began in the 70s of the XX century), it is one of the most important sectors of the country's economy. Since the late 1980s, demand for petrochemical products has grown one and a half times faster than the country's gross national product.

Three large industrial complexes are located in Ulsan, Yecheon and Daesan. The Ulsan complex has three crude oil crackers capable of producing 1,130,000 tons of ethylene annually. There are five crackers in Yecheon producing 2,890,000 tons of ethylene annually, and three plants in Daesan that produce 1,680,000 tons of ethylene annually.

In 2002, the production of the three main types of industry products - synthetic resins, synthetic fibers and synthetic rubbers - amounted to 16,902 thousand tons, which is 6.0% more than in 2001. Of these, 8,947 thousand tons, or 57.7%, were consumed in the domestic market (annual increase of 7.6%) and 7,145 thousand tons, or 42.3%, were exported (an increase of 4.1%). The total volume of exports in monetary terms amounted to $9,265 million, which is 10.4% more than in 2001.

Textile industry. The South Korean textile industry is export-oriented - although the country covers about a third of domestic demand with the help of imports, however, about two-thirds of its products are exported. In the total volume of exports, textile products account for 9.7%, and the trade balance in 2001 amounted to $11.2 billion.

The industry relatively easily recovered from the consequences of the 1997 crisis, reaching the pre-crisis level of production already in 1999. However, since 2001, the volume of exports began to gradually decline. Experts see the main reason for this in lower prices - it has become difficult for South Korean manufacturers to compete with local companies. Exports between January and June 2003 were $7.3 billion, down 2% from the year before. The volume of production also decreased by 3.5%. On the contrary, clothing imports increased by 21% over the same period. The total volume of imports of textile products amounted to 2.26 billion dollars, which is 9.1% more than a year before.

In terms of textile exports, South Korea ranks fifth in the world after China, Italy, Germany and the United States. In terms of production, the country is in seventh place.

Most of South Korea's textile investment goes to China, and there is also investment in the textile industry of the United States, Vietnam, the Philippines, Indonesia, Guatemala, Honduras, Bangladesh, and Sri Lanka. Direct investment in the textile industry of other countries increased 110 times between 1987 and 2002. The number of workers in the industry decreased by 38.7% between 1990 and 2001, from 605,000 to 371,000. The value-added of the textile industry fell from 8.6 trillion won in 1989 to 5.5 trillion won in 2001.

Energy. South Korea is a relatively mineral-poor country. Its energy resources include small reserves of coal, uranium and water resources. Electricity production in 2001 was 5,212 thousand tons of oil equivalent (TOE), which corresponds to only 2.7% of the energy consumed in the country. Hard coal production fell from 2,228 thousand toe in 1995 to 1,718 thousand toe in 2001. Hydroelectric power plants and renewable energy sources generated 1,038 thousand toe and 2,456 thousand toe respectively in 2001. There is no development of uranium deposits in South Korea.

Over the past three decades, energy consumption in the country has grown significantly - from 43.9 million toe in 1980 to 198.4 million toe in 2001. The main source of energy is oil (51% of all energy in 2001). South Korea is the world's sixth largest consumer and fourth largest importer of oil. About 1.1 billion barrels were imported in 2001, mostly from the Middle East. The country is also the world's second largest importer of liquefied natural gas and the world's seventh largest importer of natural gas overall. Hard coal is also imported, mainly from China and Australia.

In 1978, the first nuclear reactor was launched in the country, after which nuclear energy in the country began to develop rapidly. Now there are 16 nuclear power plants in the country. In 2001, these power plants produced 39% of all electrical energy.

Electricity production in the country has grown from 37 TWh in 1980 to 285 TWh in 2001. Over the years, the share of individual types of fuel for the production of electrical energy has also changed significantly. The government of the country pays great attention to the development of renewable energy sources. In 2001, 2.45 million toe of energy was produced (1.2% of the total). Most of it comes from the production of energy from industrial and domestic waste. In 2001, there were 442 waste-to-energy plants in the country. The southern coast of the country is suitable for the needs of solar energy, with the help of which in 2001 37.2 thousand toe of energy were produced. In the same year, there were 40 wind farms in the country with a total capacity of 6.6 MW, producing electricity at a cost of $0.1 per kW.

High-tech production. Consumer electronics and telecommunications equipmentConsumer electronics products are divided into three categories: audio devices, video devices and home appliances. Video devices include devices for playing and recording video information (TVs, VCRs, videos, cameras, etc.), audio devices - devices for recording and playing audio information, and household appliances include home appliances such as microwave ovens, refrigerators, washing machines, etc. P. Telecommunication equipment is primarily devices for wired and wireless communication - routers, telephones, etc.

Currently, South Korea occupies one of the first places in the world in the production of consumer electronics. Now the country, as well as around the world, is experiencing a trend towards digitalization, which increases the demand for products such as digital TVs, DVDs, MP3 players, etc. The largest companies in the industry are LG, Samsung and Daewoo Electronics. They produce almost the entire range of consumer electronics, most of which is exported. The output of consumer electronics was $17.6 billion in 2002, and exports were $11 billion.

Telecommunications equipment produced by South Korean companies is primarily cell phones, although other segments are also well developed. This is due both to the large volume of the domestic market (which in 2002 amounted to 27.9 billion dollars) and the high demand for South Korean products abroad (the volume of exports in 2002 amounted to 22.3 billion dollars). According to Gartner, in July - September 2004, Samsung Electronis, having sold 22.9 million mobile phones, for the first time outstripped the American company Motorola in terms of the number of units sold, winning second place (after Finnish Nokia), or 13.8% of the entire world market of terminals.

semiconductor industry. The semiconductor industry produces integrated circuits and semiconductor devices such as diodes and transistors. In South Korea, this industry is one of the most important in the economic structure. Its rapid development began in the mid-1980s. As a result, since 1992, semiconductors have been the largest item in South Korean exports, accounting for 10% of it (as of 2002).

The semiconductor industry, especially the memory chip industry, played a key role in boosting the country's economy after the 1997 crisis. Until now, South Korea is the world's top producer of memory chips. Most of the exports go to developed countries: the United States, Japan, the European Union and the countries of Southeast Asia. Between 2000 and 2002, the South Korean semiconductor industry stagnated due to a worldwide decline in demand for semiconductor products. Thus, the overall decline in output during this period amounted to about 10 billion dollars (from 28.5 billion to 18.2 billion), but already in 2002 an increase of 8.2% was recorded due to an increase in demand for certain types of microcircuits. , in particular on DRAM memory chips. Exports in the same year rose to 16.6 billion dollars, which is 16% higher than in the previous year, 2001. Domestic demand for products of the semiconductor industry increased from 9 billion in 2001 to 9.7 billion in 2002 (an increase of 7.7%). The volume of imports also increased from $4.2 billion to $8.6 billion.

A feature of the South Korean semiconductor industry is that it is largely dependent on the demand for memory chips, whose share in the total production is 80-90% (in other developed countries, this share ranges from 10% to 30%). The South Korean semiconductor industry equipment market in 2002 amounted to $1.9 billion, but only 15% of this figure is domestic production, the rest is imported. Materials for the semiconductor industry include photolithography masks, silicon chip substrates, photoresistors, etc. The domestic market for materials in 2002 was $1.7 billion, half of which was imported from the US and Japan. Dependence on imports of semiconductor materials in South Korea is lower than in Japan, but higher than in the United States.

Agriculture in South Korea

South Korea has a monsoonal climate with warm and humid summers and relatively cold and dry winters. Until the 20th century, the main agricultural product of the country was rice, but now the product range has expanded significantly and includes many types of fruits, vegetables, livestock products and forestry products.

The share of agriculture and forestry in 2001 was 4% of the country's Gross National Income, the peasant population - 4 million people (8.3% of the total population). Although the share of agriculture in the country's economy is small, the share of related industries, such as the production of mineral fertilizers, the food industry, etc., is 14% of the gross national income. The country's accession to the World Trade Organization in 1995 accelerated the transformation and liberalization of the agricultural market, which led to a fall in product prices. The government had to pursue a policy of protectionism in relation to national producers.

South Korea's main agricultural product is rice: about 80% of South Korean farms cultivate this cereal. Rice is consumed mainly within the country, as it is unable to compete in the foreign market due to its high price. In 2001, rice was grown on 1.08 million hectares of land. The harvest amounted to 5.16 tons per hectare. Production of other cereals (primarily barley and wheat) in 2001 amounted to 271 thousand tons. Soybeans and potatoes in the same year produced 140 thousand tons. In 2001, 11.46 thousand tons of peaches were exported (mainly to the USA, Canada, Taiwan and Indonesia), 3.73 thousand tons of apples (mainly to Taiwan, Singapore and Japan) and 4.66 thousand tons of apples. tons of tangerines.

Animal husbandry is the second largest income sector of agriculture after rice. In 2001, the number of cattle was 1,954 thousand heads, the number of pigs reached 8.7 million heads, the number of chickens was 102 million. The consumption of livestock products in the late XX - early XXI century was constantly growing. Consumption of beef in 2001 reached 384.06 thousand tons, pork - 807.42 thousand tons, poultry - 350.3 thousand tons.

The timber industry began to develop in the country since the 1960s. Forests cover 6.4 million hectares of the country. The total market volume in the country in 2001 was 428 million cubic meters, in the same year logs were imported in the amount of 7.1 million cubic meters in the amount, the volume of imports of all types of forest industry products in monetary terms amounted to 1.7 billion dollars. Some products, however, are exported - these are, first of all, mushrooms and chestnut fruits. In 2001, the volume of exports amounted to 210 million dollars.

Fishing is an important part of the South Korean economy. About 140 thousand people work in this sector. There are about 96 thousand fishing vessels in the country. The volume of production in monetary terms amounted to 3.6 billion dollars in 2000. In coastal waters, saithe, sardines, mackerel, anchovies, flounder, cuttlefish and squid are most actively harvested. Marine products are also grown in nurseries - these are primarily shellfish. In such nurseries in 2000, products worth 560 million dollars were grown. Exports in 2000 amounted to $1.5 billion of fish and fish products, while imports amounted to $1.4 billion. The main consumers of the South Korean fishing industry are Russia, China, Japan and the United States - these countries account for 70% of all South Korean exports. Prawns, squids and sardines are mainly imported into the country. On July 1, 1997, South Korea passed a law to remove restrictions on the import of fish products. Thus, a market was opened for 390 types of fish products listed in a special list compiled by the government of the country. At the same time, export regulations were relaxed and measures were taken to increase the export of fresh and frozen flounder, eel and some other types of fish.

Service sector of South Korea

The service sector primarily includes insurance companies, catering establishments serving Korean cuisine, hotels, laundries, saunas, medical and sports institutions, enterprises operating in the field of entertainment, retail, etc.

In the mid-1980s, most of the workers in this sector of the economy were employed in retail. The vast majority of stores were small, limited-stock stores, most often owned by the same family. In 1986, there were about 26,000 wholesale and 542,000 retail outlets in the country, as well as 233,000 hotels and catering outlets, employing a total of 1.7 million people.

Now the service sector has become dominant in the country's economy, accounting for two-thirds of the total gross domestic product. In 2006, the Capital Market Consolidation Act was passed to liberalize the service sector and turn the country into a major financial hub in East Asia.

Today, South Korea has one of the most advanced telecommunications systems in the world. In 2000, as part of the 15-year CyberKorea 21 e-development program, an expanded broadband Internet access network was built, covering almost the entire country. Among the member countries of the Organization for Economic Cooperation and Development, South Korea leads in terms of broadband Internet penetration: according to the Ministry of Trade, Industry and Energy of the country, it is 24.08 per 100 people.

Transport in South Korea

Transport in South Korea is a system of transport communications of the country, such as railways and roads, air and sea routes.

The total length of railways is 6,240 kilometers (of which 525 kilometers are electrified). The six largest cities in South Korea - Seoul, Busan, Daegu, Incheon, Gwangju and Daejeon have subways. The Seoul Subway is the oldest in the country, the first line from Seoul Station to Cheongnyangni opened in 1974. The total length of motor roads is 97,252 km, of which 74,641 km are paved. The main ports of the country: Jinhae, Incheon, Kunsan, Masan, Mokpo, Pohang, Busan, Donghae, Ulsan, Yeosu, Sokcho. South Korea's main carriers are Korean Air and Asiana Airlines. Both provide air transportation services both domestically and internationally. Seoul is served by two airports: Incheon and Gimpo Airport. International flights are handled mainly by Incheon Airport, while Gimpo handles mostly domestic flights. Other major airports are located in Busan and Jeju. There are 108 airports in the country.

Foreign economic relations of South Korea

Trade relations with Western countries include economic partnerships primarily with the United States and the European Union.

The US is South Korea's main economic partner. In addition, South Korea ranks seventh on the list of US trading partners, ahead of many developed European countries such as Italy and France, and sixth on the list of US importing countries. In addition, South Korea is an attractive country for investment by US companies - from 1996 to 2003, the US invested $20 billion in the South Korean economy. In 2003, the US was South Korea's largest trading partner and the seventh largest export market. Strengthening economic ties between the two countries, however, were accompanied by numerous disagreements in trade policy. The intensity of these disputes has significantly decreased since the late 80s and early 90s of the XX century, including due to the fact that South Korea carried out a series of market reforms as compensation for receiving a 58 billion loan from the International Monetary Fund after the 1997 crisis. of the year. At the beginning of the 21st century, both countries are trying to more gently resolve conflict situations. Bilateral trade agreements made in early 2001 played a significant role in this.

Around the same time, a series of trade agreements between South Korea and EU countries were signed, which spurred the growth of trade between the two regions. The volume of trade amounted to 46 billion euros, doubling in ten years. However, some issues of mutual trade still remain unresolved. At the beginning of the 21st century, the greatest progress was made in accelerating the processes of mutually beneficial exchange in the field of science and high technology (as you know, South Korea spends 3% of its gross domestic product on scientific research). In 2005, bilateral talks were held on exchanges in science and technology. South Korea also participates in some global projects initiated by the European Union, in particular in the Galileo and ITER projects. The countries of the East, primarily East Asia, are the main trading partners of South Korea. In the total trade turnover with these countries, three countries stand out - China, Japan and Saudi Arabia, which is the main supplier of oil to South Korea.

Trade in the East Asian region has grown strongly in the early years of the 21st century. The leading countries of the region (South Korea, Japan and China) have become more open than at the end of the 20th century. If in 1991 the trade turnover between these three countries amounted to 56 billion dollars, then in 2004 it exceeded 324 billion. The growth of South Korea's trade turnover with China and Japan in the period from 2000 to 2004 exceeded the growth of trade turnover with all other countries twice. At present, the concentration of trade in the region is higher than in the European Union, although the countries of the region do not have such a favorable legislative framework for mutual relations as in Europe. China and Japan are the first and third trading partners of South Korea.

The main subject of South Korean exports to the countries of East Asia are products of the machine-building industry, automobiles, electronics, textiles, products of the metallurgical and petrochemical industries. These destinations account for three-quarters of South Korea's total exports to Eastern countries. Trade with China is developing especially actively, since heavy and chemical industries are intensively developing in this country.

Trade and economic relations between the USSR and South Korea began to be carried out from the end of 1988 (before that, trade was carried out through intermediary firms from third countries). Now the share of Russia in the total trade turnover of South Korea does not exceed 1.5%. The main commodities imported from Russia are minerals such as natural gas, crude oil and coal, as well as steel products. Exports to Russia are mainly consumer electronics and products of the textile and engineering industries.

At the beginning of the 21st century, trade and economic ties between the two countries developed rapidly. Interaction in the fuel and energy complex seems to be a promising area of ​​cooperation. The Irkutsk gas project is being worked out (the expected volume of investments is up to 12 billion dollars). Cooperation in this area seems to be particularly beneficial for both parties (this should include the possible joint development of energy deposits in Siberia and the Far East with Korean companies, including, in addition to gas in the Irkutsk region, the development of coal in Yakutia and Buryatia, oil and gas resources of Sakhalin Island).

DPRK. Since 1988, the volume of bilateral trade between the two Korean states has increased several times (in 1989 it was $18.8 million, and in 2002 it was already $647 million). In 2006, this figure slightly decreased due to the deterioration of relations between the countries. In 2002, South Korea imported $271.57 million worth of products from North Korea, mainly agricultural and metal products, and exported $371.55 million worth of goods, mainly humanitarian aid, including mineral fertilizers and clothing. South Korea is now North Korea's third largest trade partner after China and Japan. The South Korean company Hyundai Group has launched several investment projects related to North Korea, including the development of tourism in Kumgangsan (Diamond Mountains). In 2001 alone, 84,347 people visited North Korea as part of this project. About a thousand North Korean citizens entered South Korea from North Korea, mainly to participate in sports competitions. Another South Korean company heavily investing in the North Korean economy is Hyundai Asan, which has plans to build a 3.2 km2 industrial complex in Kaesong, near the Demilitarized Zone. 2002 was also marked by serious progress in the construction of the Seoul-Sinuiju railway (in early 2004, this project was frozen).

ECONOMIC DEVELOPMENT OF SOUTH KOREA

I.V. Novikov, student V.A. Utkina, student

Far Eastern Federal University (Russia, Vladivostok)

Annotation. The paper analyzes the economic growth rates of South Korea as the most successful example of an effective state and economic policy among developing countries. The author describes the main factors that influenced the growth of the country's GDP in the period from 1962 to the present. Key words: South Korea, economy, GDP, development, consumption.

Korea is currently a clear example of the successful economic development of the country. A state without significant natural resources, devastated by war, with a per capita income of less than $100 in 1962, reached $10,000 by 1995, and had an average annual GDP growth of 10%. Currently, Korea ranks 13th in the production of goods and services, is the 8th largest trader in the world, and has a per capita income of more than $25,000 per year. It is one of 60 countries that had a per capita income of less than $300 in 1960, but Korea was able to raise this figure to $10,000 by 1995. Korea also became the second country after Singapore to withdraw from the lending program during the Asian financial crisis. World Bank.

Research into the reasons for this significant economic growth in South Korea is ongoing. For example, scientists point to the accumulation of human capital as a source of growth, but its contribution to the development of the economy was less than 10%. Along with this, the role of education, training and dissemination of knowledge, which undoubtedly played an important role in the development of Korea, is considered. However, they cannot be considered major factors, since it is known that between 1962 and 1994 the government did not spend more on education than other developing countries with the same level of per capita income. According to the majority

According to researchers, such an impressive growth rate of the Korean economy is the result of annually growing investments that exceed 30% of the country's GDP, with a significant part of them coming from official foreign financial assistance.

Official foreign support for Korea.

The scale and types of official foreign aid.

During the social and economic development of South Korea from 1945 to 1999, the total amount of official foreign financial assistance is about 44 billion US dollars at current prices. This includes approximately $7 billion in government development grants and $37 billion in community development loans. Thus, the total amount of loans is divided into "Official Development Assistance" of $6 billion (grants are more than 25%) and "Other official assistance" of $25 billion (grants are less than 25%). At a time when the amount of financial assistance received by Korea between 1965 and 1995 was comparable to that of other 59 developing countries, with a per capita income of less than $300 in the 1960s, Korea achieved an average annual GDP growth of 2% . However, the other 15 developing countries achieved GDP growth of 10%, so it cannot be said that the rapid growth of the Korean economy is due only to foreign investment.

The main "donors" of financial assistance were the United States, Japan and Germany. The main multilateral donors were the United Nations, the United Nations Reconstruction Agency in Korea, and the International Development Bank.

Distribution of financial assistance

Since most of the grants and loans were directed mainly to food and emergency needs, and loans for social development accounted for 84% of the total official investment, the use of these funds actually reflects the government's strategy in the development of the country, so, despite the financial crisis 51% of investments were directed to the development of infrastructure, 24% to the modernization of the production sector, and about 12% to the social infrastructure sectors. This model of distribution of funds differed from those used in other developing countries, for the better, therefore, rational sectoral distribution of financial assistance can also be added to the number of factors for economic growth.

The current economic situation: general economic activity.

As of today, economic growth continues at a moderate pace. Growth for 2017 is projected at 2-2.8%, and by 2018 this figure should reach 3%. This is due to the fact that the development in the service sector remains at a sufficient level, but the level of industrial production growth and the corresponding share of production capacity utilization remain at a low level. It is expected that the growth of the country's economy will be carried out due to a moderate recovery in demand in the domestic market and growth in exports. But all these prospects are based on the assumption that the world economy will also increase its growth rate. Also, along with the decrease in interest rates on loans, their number has increased dramatically, which significantly affected the current state of the country's economy.

Domestic consumption fell by 3.5% last year, and this figure continues to decline slowly. This is due to a slowdown in global economic growth, a decrease in private consumption and investments related to construction, in connection with this, GDP growth amounted to 2.3% compared to the planned 2.7%. The level of domestic consumption plays a significant role in the Korean economy, since its share in the formation of the country's GDP is 46.5%.

In 2014, investment in fixed assets amounted to 7%, and strongly affected the growth of the economy, which suffered during the economic crisis. But some reductions in investment in the electrical industry and electronic technology are due to increased competition in the electrical goods market, and therefore demand for this category of products has also decreased. But more positive forecasts are aimed at investment in the construction industry, which has been stagnant since the global financial crisis, until the shortage of funds in 2013. But after that, investments in construction increased sharply, and by the end of 2013 they accounted for 6.7%, and every year this figure continues to increase by an average of 1.9%. At the same time, the number of transactions in the real estate sector has increased, despite the fact that prices continue to rise. For 2017, real estate investment is projected to grow by at least 4.5% compared to last year.

Today's forecasts show that the Korean economy will continue to grow at a moderate pace if domestic and external conditions remain favorable, but there are concerns about consumer debt, which significantly affects the country's economy. At the same time, given the weakening of domestic consumption and low inflation in the face of international economic uncertainty, there is a need to maintain an expansive macroeconomic policy, in which a significant role is given to foreign investment, and together with

By this tax and budgetary policy at a high level, in order to maintain the high, must continue to maintain and sustain the steady growth of the Korean economy. stimulate economic activity

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ECONOMIC DEVELOPMENT OF SOUTH KOREA

I.V. Novikov, student V.A. Utkina, student Far Eastern federal university (Russia, Vladivostok)

abstract. The paper analyzes South Korea's economic growth rate as the most successful example of effective state and economic policy among developing countries. The author describes the main factors that influenced GDP growth in the period from 1962 to the present. Keywords: South Korea, economy , GDP, development, consumption.