An economy is a situation or state of a particular nation or country that is characterized by money supply of consumption and production of goods, resources, and services through management. Statistics show that South Korea as a country has the largest economy in Asia ranking it the Fourth and Eleventh across the world. The South Korean Economy is mixed and dominated by families mainly called the Chaebols. This country has proven to work together in matters of developments by the support from the government and it is one country that is known to grow from one of the poorest economies to one of the largest in the world. Therefore in this paper, we are going to evaluate the Economy of South Korea in recent decades from both Historical and International perspective explaining the Overview, Growth along the 1900’s and major aspects and sectors the Economy of South Korea has undergone.
The Overview
During the Korean War in the 1960’s, there was a drastic spread of fear and depression where there was the loss of properties, homes, and resources. Companies and Industries in South Korea dropped in performance as a result of low labor intake and this resulted in a very poor Economy in this country where statistics show that only 79 dollars of products were produced per capita [1]. The Government of Korea had a hard time bringing people together by providing security in homes and conducting awareness on peacekeeping among the high population of people in Korea. The industries and the manufacturing organizations experienced products and capital a 30 percent loss of domestic products. The economy of South Korea dropped to appoint where products and goods were very expensive due to scarcity and low supply of materials. These low performance in the country led to movement and migration of the Korean people from urban areas to the rural developments. There was a drastic increase in unemployment among the people of Korea especially the youth, for example, the College dropouts who took part in committing crimes due to lack of money and fear of being bankrupt.
In 1989, South Korea also experienced Structural problems when there were decreasing importation and exportation of orders that affected the industrial sectors. The analysis made by the Ministry of Trade has shown that there was an increase in wages, increase labor costs and higher rates of interests. The increase of technology aspects made new discoveries which did not make a change because of lack of trained computer professionals during this time of depression. South Korea was forced to invest every amount made in the industries and factories to establish automation companies and organizations which acted as a breakthrough for the people of Korea and also this project was supported by the Government to prevent the country from being bankrupt. Automation factories were introduced and established to increase and boost the productivity and provide independence of labor to the people. The Korean War brought a really bigger negative impact in the country where most of the population lost hope in development but it has proven to be a rising pillar and to date South Korea has influenced other related countries to develop their computer, for example, Japan which also has experienced natural and artificial threats like the bombing of Hiroshima and Nagasaki [4]. This happened in the Second World War when the United States of America dropped an atomic bomb in this two cities that led to exploitation and destruction of properties and lives were also lost. These two countries South Korea and Japan share a common experience which promoted an international relation between them having development trips and meetings which has promoted spread of different knowledge and ideas that has helped them establish and discover new technology.
South Korean Rapid Growth in the 1900’s
After the Korean War, The Economy of South Korean began growing an increase was analyzed and found that the Economy of the country had risen by 8 percent in 1989. The country embraced a change in the economy where the factories and the industries were developed and the supply of goods and services began taking root and shoot with higher profits. Peaceful awareness was conducted which brought people together. The government also chipped in by advertising jobs and occupations for the people in Korea which encouraged the youth to seek employment in any company or organization where they were employed to perform different skills. They also established learning institutions which had well-educated professors that assessed the training of the employees and students. Industrialization evolved in this country because of the establishment of some strategies to increase the market and development factors in the country. Some of the strategies include having knowledge seminars to advise and train the youth and upcoming entrepreneurs on ways to start small businesses [2]. Most of the training lessons that were taught mainly were about technology because technology is able to change a countries economy. Through technology, the people of South Korea were able to communicate through short or longer distances by the use of mobile phones, emails, and social media or websites. Communication promoted the spread of ideas which traveled from one person to the other.
By the rising of development in the urban areas, the people of South Korea started migrating again living the rural regions to be underdeveloped except some activities which were performed for example the mining industries contributed to the development of some rural regions in a smaller percentage as compared to the urban areas. The urban areas developed faster because of the increase of the industries, companies, and organizations due to high labor rate and the government has tried to establish agricultural aspects which have been a challenging in the rural areas due to lack of professional skills to do farming. The rural areas of South Korea are characterized with good soils and relatively good rainfall that can trigger the growth of plants and vegetation, for example, the growth of rice. Most of this opportunities are fading because the people have no correct skills to perform in agricultural management resulting in loss of land.
Financial Crisis in Asia
South Korea went on growing and having a stable economy in the 1990’s in both the private organizations and also public organizations. Asian Financial Crisis began when some of the currencies were triggered and attacked in 1997 which originated from the Large Loans the Korean organizations took from the bank and the Economy was diminishing again bit by bit. The United States and India were also involved in this debt problem because South Korea borrowed some of the loans from this countries for example in Motor companies purchase for boosting the development. The South Korean Government decided to put in some adjustment by swapping the debts by setting wages which have flexible rates through funding sources. Labor adjustments were also implemented during the Financial Crisis to evaluate some of the currencies that were lost in the country which led to a slight comeback of the Economy Growth.
A future business plan and structure was developed to help in the growth of different sectors of performing businesses, for example, the shipbuilding, automobile, mining and construction Facilities that we are going to discuss illustrating their purposes in the Economy of South Korea.
Ship Building
Through the years South Korea has been the number one producer of ships and oil tankers and the leading production company was the Hyundai. This company was responsible for producing over 1 million ships that were used in the transportation of good and people from one place to the other. Quality products were manufactured made from steel and high technology machines that were responsible to perform more than one function. South Korea has grown and in the modern world both locally and internationally the country is the leading producer of passenger and goods shipbuilders [3]. Bankruptcy also affected this business which also had related companies affected like for example the Marine Engineering and offshore organizations.
Automobile
South Korean Automobile Industries are one of the major breakthroughs that have been embraced and Motors have improved the Economy by more than 10 percent through imports and exports in the car manufacturing organization. These companies make large capital approximately more than 2.5billion dollars in a year. They produce different designs of cars, for example, the Range Rovers which are very expensive and that are exported to other related countries all over the world and also the importation car spare parts. The United States of America was affected by the emergence of these Automobile Companies in South Korea that threatened to be a stiff competitor in this type of business production. By the establishment of Hyundai as the leading producer, South Korea has proven to be the leading manufacturer of Motors which has triggered development.
Mining and Construction
North Korea is known for producing minerals like coal for example which are shipped in trucks to the mining industries. Some part of South Korea produces iron in large quantities which are also exported to other countries which are manufactured in pieces of equipment which have higher temperature and boilers. Construction projects have been important in South Korea in the 1960’s which has been the main source of foreign currency in the country. Availability of major landmarks and architectural buildings has led to increasing market by attracting the tourists. The Construction Companies have established buildings in other parts of the world, for example, Libya by creating a good international relation with foreign countries. Sharing of ideas and the building of architectural school has resulted in the evaluation of Construction projects.
Conclusion
South Korea has passed through different challenges and through the help of the Government organizations, the Economy of this country has performed well through the years. South Korea has shown interests in sharing of ideas with other foreign countries and in this paper, we have discussed the overview of the South Korean Economy, Growth along the 1900’s and major aspects and sectors the Economy of South Korea has undergone.
References
[1]Asongu, Simplice A. "Knowledge economy gaps, policy syndromes, and catch-up strategies: Fresh South Korean lessons to Africa." Journal of the Knowledge Economy 8.1 (2017): 211-253.
[2]Eder, Norman R. Poisoned Prosperity:
Development, Modernization and the Environment in South Korea: Development, Modernization and the Environment in South Korea. Routledge, 2016.
[3]Kim, Nam Sook, et al. "Distribution of butyltins and alternative antifouling biocides in sediments from shipping and shipbuilding areas in South Korea." Marine pollution bulletin95.1 (2015): 484-490.
[4]Hayes, Peter. "Hiroshima and Nagasaki." Global Asia 10.3 (2015): 62-66.
