2:32:PM  |  24 September 2017

Economic

Key Facts

 

Official Name

Republic of Korea (ROK)

Land Area

99,678 sq km

Population

50 million

Capital City

Seoul

Religion

Christian 29%, Buddhist 23%

Language

Korean

Currency

South Korean Won

Exchange Rate

US$1 = KRW1065 [as of 15 Oct 2014]

GDP

2013 US$1,304 billion

GDP Per Head

2013 US$31,967 at PPP

Real GDP Growth

2013 3%

Exports

2013 US$560 billion

Imports

2013 US$516 billion

Main Exports

ships, petroleum products, semiconductors, motor cars and vehicles, liquid crystal devices, car parts, mobile phones, home appliances, steel products, telephone sets

Current Account

2013 US$70 billion surplus

Inflation

Sept 2014 1.1%

Unemployment Rate

Sept 2014 3.5%

 

Economic Situation

The ROK is assuming a global reach and impact commensurate with its status as the world’s fifteenth largest economy (by nominal GDP). The ROK was the first developing country and former aid recipient to join the OECD. Its inclusion in the G20 was further confirmation that the country has arrived as a middle power.

The ROK’s rapid economic development has been export-led, having initially inserted itself into the world market in a number of heavy industrial sectors by dint of competitive firms supported by low-cost labour. Increasingly, the ROK has focused on high-tech industries including electronics, semiconductors, shipbuilding and automobiles. Successive governments nurtured the development of chaebol (family-run conglomerates), such as Samsung, Hyundai, and LG, which have dominated the economy since the 1970s.

The ROK rebounded strongly from the global financial crisis in 2008-9. The Government’s economic stimulus measures, a sharp and sustained rebound in exports, the influence of the Chinese economy and the benefit of experience from the 1997 Asian crisis have all been credited as reasons for the ROK’s impressive performance. However in 2011/2012 the ROK economy faced some challenges including slowing exports and consumer spending. Household debt and downturns in the construction and property markets have also emerged as challenges to financial stability. In early 2014, President Park announced a Three Year Plan for Economic Innovation based on three strategies: fair and efficient economy (reform the public sector, correct unfair business practices in the private sector especially those harming small- and medium-sized enterprises); growth through innovation (promote a creative economy, develop overseas markets); balance between exports and imports (stimulate domestic consumption).

South Korea leads the way in Asia being the first country to introduce a greenhouse gas emissions trading scheme (ETS), from 2015. The ETS is designed to help reduce the country’s emissions of harmful gases by 30% by 2020, green its fossil fuel dependent industries and foster clean technology innovation. Despite being a non-Annex 1 country, the ROK has signed on to climate change commitments.

With its economic success founded on access to world markets, the ROK is a proponent of free trade agreements (FTAs). The ROK has FTAs with Chile, Singapore, India, ASEAN, and the European Free Trade Association (Iceland, Norway, Liechtenstein, Switzerland), the EU, Peru, and the USA, meaning the ROK and its FTA partners account for nearly half of world economic output. It has negotiated but is yet to ratify FTAs with Australia, Canada and China. Though supporting improved market access for non-agricultural goods, the ROK takes a more defensive stance on agriculture.