South Korea NIC

Question 1

Background

Answer 1

• post korean war, SK was one of poorest countries in the world
• by 2022, economy was 10th largest in world

Question 2

Reasons for emergence
(foreign aid)

Answer 2

• 1946 - 1976, US provided $12.6bn in economic assistance

Question 3

Reasons for emergence
(early education investment)

Answer 3

• by 1960, 96% of all children primary school age were attending
• by 1961, SK had best-educated workforce of any country with a comparable income level

Question 4

Reasons for emergence
(strong govt + econ policy)

Answer 4

• in 1961, General Park Chung Hee developed 5yr economic plans
• first one involved changing from import substitution to export-orientated development
• also nationalised commercial banks, provided low-interest loans to businesses

Question 5

Reasons for emergence
(technical skills education)

Answer 5

• established Korean Institute of Science + Tech in 1966
• focus on acquiring technical skills

Question 6

Reasons for emergence
(Diplomatic ties)

Answer 6

• Park sent 300k troops to help Americans in Vietnam
• in exchange SK firms given lucrative contracts to supply goods + services to American + allied military forces
• Park nationalised relations w/ Tokyo in 1965
• Years after treaty, Japan was major foreign investor, supplied abt 60% of foreign tech from 1962-1979

Question 7

Reasons for Growth
(Shift to heavy industry)

Answer 7

• 1972, Park declared Martial Law
• redirected economy to development of heavy + chemical industries
  e.g. steel, chemical, shipbuilding, metal, electronics
• 1972 - 1982 steel production increased 14x
• in 1980s, SK worlds 2nd largest shipbuilder

Question 8

Reasons for Growth
(Public-private partnerships)

Answer 8

• the state, through ownership of banks, poured credit into a few companies to grow industries targeted for development
• e.g. Samsung

Question 9

Reasons for Growth
(social transformation)

Answer 9

• 1960, farmers made up 60% of pop
• fell to 38% in 1980

Question 10

Reasons for Growth
(diversification + innovation)

Answer 10

1983, Hyundai cars exported
- export markets became more diversified, less dependent on US

Question 11

Reasons for Growth
(TNCs + FDI)

Answer 11

• SK received $11bn in FDI this year
• Japanese TNCs operating in SK include: Sony, Mitsubishi, Toyota, Canon