Economic Development of Korea

Korea actively participated bilateral free trade agreement as well as mega-regional trade agreement such as RCEP or TPP

• Korea actively participated bilateral free trade agreement as well as mega-regional trade agreement such as RCEP or TPP
• Shifting Korea’s Trade Policy paradigm
• Why?
• To reduce costs associated with the Spaghetti Bowl Effect
• Asia is the most active in Global Supply Chain Management
• Need to help firms to improve efficiency in production
• To counteract the possible trade diversion effect of mega-trading blocs such as EU,NAFTA, MERCOSUR etc.
• To Tone down regional security threats
• Can Korea-Kazakhstan be Partners in the era of FTAs and Mega FTAs?

How Did Korea Achieve it?

• How Did Korea Achieve it?
• 7.5% p.a. Economic Growth Rate (1953-2014)
• With a fairer income distribution
• Gini Coefficient: 0.344 (1965) => 0.307 (2012)
• Significant Structural Changes
• From Primary to Industry
• From Light Manufacturing to Capital Intensive and Technology Intensive
• Why?
• Leaders Committed to Economic Growth and Development
• Accountability and transparency in International Economic and Trade Policy
• Outward Orientation
• Globalization through a main level of openness
• Strategic, Pro-active Policy makings
• Competitive Macroeconomic Policy
• Promoting Competition

Rapid economic growth

• Rapid economic growth
• Accompanied a Fair Income Distribution: Gini Coefficient
• Significant structural changes
• In Outputs
• Agriculture-Industry-Service
• In exports
• Primary – Manufacturing
• L-intensive-K-intensive-Knowledge-intensive

1965	1970	1976	1982	1990~1997	1998	1999	2000	2001	2006	2012
0.344	0.332	0.391	0.357	0.281~0.295	0.316	0.32	0.317	0.319	0.306	0.307

Export Share (%)	1962	1972	1977	1982	1987	1991	2001	2011	2014
Primary	27.5	10.3	13.8	7.9	6.0	3.5	2.7	2.8	2.2
Light Manufacturing	63.4	56.3	52.2	43.5	42.3	36.5	16.4	6.2	6.4
Heavy and Chemical Manufacturing	9.1	33.4	34.0	48.6	51.7	60	80.9	91	91.4
IT						15.4	27	22.4	23.9
Others						44.6	53.9	68.6	67.5

	1953	1962	1971	1981	1991	2001	2011	2014
Primary(Agriculture, Forestry & Fishery)	30.1%	25.9%	16.6%	9.8%	4.9%	3.3%	2.3%	2.3%
Mining	2.0%	3.5%	2.7%	1.8%	0.7%	0.3%	0.2%	0.2%
Manufacturing	2.8%	4.9%	9.3%	16.9%	20.9%	25.1%	31.6%	32.0%
Electricy, Gas and Water	0.1%	0.2%	0.5%	0.9%	1.6%	2.1%	2.2%	2.1%
Construction	3.9%	5.5%	10.0%	10.6%	12.1%	6.8%	4.7%	4.4%
Services	61.1%	60.0%	60.9%	59.9%	59.8%	62.4%	59.0%	59.1%

• Source: nso.kr

• Gov’t

• Business

• People

• Gov’t

• Business

• People

• Gov’t

• Business

• People

• <1960s-Mid1980s>

• 
  

• Gov’t Entrepreneurial Leadership

• Gov’t Leadership
• & Business Power

• Gov’t Leadership
• & Business Power & People Power

Kazakhstan and Korea: Now
	Kazakhstan	Korea
Area (km2) (ranking)	2,724,900 (9th)	99720 (109th)
Agricultural Land (%)	77.4	18.1
Population (million; 2015) (ranking)	18.2(61th)	49.1 (28th)
65 and overs (%)	7.17	13.00
Life Expectancy (years)	70.6	80
Population Growth Rate (%; 2014)	1.14	0.14
Birth Rate (per 1000 popltn) (ranking)	19.15 (19th)	8.19 (220th)
Fertility Rate(child born per woman) (ranking)	2.31 (92th)	1.25 (220th)
GDP (US$)	212.3 billion	1.41 trillion
Exports (US$)	87.3 billion	572.7 billion
Major Export Products	oil and oil products, natural gas, ferrous metals, chemicals, machinery	semiconductors, petrochemicals, automobile/parts, ships, wireless communication equipment, flat display, steels,
Imports (US$ Billion)	46.7 billion	525.5 billion
Major Import Products	machinery and equipment, metal products, foodstuff	crude oil, petroleum products, semiconductors, coal, steel
Major Natural Resources Reserves (ranking)	Crude Oil: 30 billion barrel (12th)	Crude oil: 0 barrel
	Natural Gas: 2.407 trillion m3 (15th)	5.748 billion m3 (89th)
Mobile Phone (2014)	28 million	57.2 million
Internet Users (2014) (ranking)	10.6 million (45th)	44.9 million (13th)
% of Population	59.3	91.5
Military Expenditure (% of GDP) (2012)	1.21	2.8

• Source: ciafactbook

• (USB$)

• Source: Korea Customs

• Source: Korea Customs

• Source: Koreaexim Bank

• Source: Koreaexim Bank

Year	Export (USM$)	Import (USM$)	Total Trade (USM$)
1993	41	47	88
1998	104	31	135
1999	57	51	108
2000	82	49	131
2005	273	242	515
2010	604	334	938
2013	1,074	249	1,323
2014	907	561	1,468

• Source: kita.net

• Korea-Kazakhstan Diplomatic Relationship
• January 28, 1992
• Korea-Kazakhstan Trade has expanded rapidly
• US$88 million (1993) to US$1468 million(2014)
• Exports
• US$41million(1993) to US$907 million (2014)
• Imports
• US$ 47 million (1993) to US$ 561 million (2014)
• But still remained below its potential

• Source: kita.net

• Source: kita.net

	Products (SITC 2 digit)		Imports	Growth Rate (%)
		Total	560,771	209.9
1	33	Petroleum and Petroleum Products	372,193	-
2	67	Steel and Iron	95,808	0.1
3	52	Inorganic Chemicals	72,228	2.9
4	68	Non-ferrous Metal	13,022	5.0
5	29	Non specified Unprocessed meat and vegetables	6,948	-0.1
6	89	Miscellaneous n.e.s	155	75.2
7	59	Chemical Products, n.e.s.	137	-54.7
8	77	Electrical Apparatus and Machinery	80	-30.2
9	26	Textile and Textile Waste	49	-
10	74	Industrial Machinery and Equipment	46	-

• Source: kita.net

	Products(SITC2 digit)		Exports (US’000)	Growth Rate (%)
		Total	906,958	268.6
1	78	Automobile	388,723	267.4
2	57	Plastics(Materials)	62,270	34.1
3	76	Communication and Recording Equipment	61,692	52.3
4	77	Electrical Machinery and Equipment	53,077	131.2
5	87	Other Scientific and Control Apparatus and Equipment	46,981	32.6
6	72	Special Industrial Machinery	46,832	28.3
7	67	Steel and Iron	36,308	108.7
8	74	Industrial Machinery and Equipment	35,129	68.8
9	82	Furniture, Bedding, Mattress etc.	18,418	-4.2
10	09	Other Food and Food stuffs	16,906	6.2

• Source: kita.net

• Source: kita.net

• In total , US$ 2.45 billion
• Finance & Insurance (29.1%)
• Construction (17.1%)
• Manufacturing (15.6%)
• Realty and Lease (11.0%)

Economic partnership between Korea and Kazakhstan

• Economic partnership between Korea and Kazakhstan
• In trade and FDI: getting stronger but remained less than its potential
• Why?
• Lack of mutual understanding
• Other reasons?
• How?