Economic Development of Korea

1990s: Crisis and Reforms

• Crisis Hit the Korean Economy in 1997
• Massive contraction of the Korean economy
• By - 5.5%
• The Value of Currency Plummeted
• By 40% in1998, relative to that in 1997
• Unemployment skyrocketed
• Unemployment rate in 1998: 7%
• 2.6% (1997)
• No of the unemployed in 1998: 1.49 million people
• 0.57million (1997)

1990s: Crisis and Reforms

• Reforms conducted
• Corporate sector reforms including Chaebols
• Big deals
• Public Sector
• More Foreign firms’ investment
• Increased FDI, especially M&As
• Government-led Reforms
• Reforms slowed down with a quick economic recovery
• 9.6% p.a. Growth Rate (1999-2000)

In the post Crisis Period: Globalization & Challenges

• In the Post Asian Financial Crisis period: Globalization and Regional Trading Agreement (RTAs)
• Actively Pursuing Free Trade Agreements
• Background
• Substantial Slowdown of Korean Economy
• Average Economic Growth Rate (2001-2014): 4% p.a
• Slow Down of Population Growth and Aging
• Average Population Growth Rate (2001-2014): 0.5%
• People with 65 and Older: 13%
• RTAs expanding rapidly,
• esp. since the establishment of WTO(Jan1,1995)
• 604 RTAs Reported to WTO & 398 RTAs are being effective (January, 2015)
• Free Trade Agreement (FTA): 220 (58%)

No of RTAs: Notification & In-force (1948-2015)

Source: WTO (http://wto.org/english/tratop_e/region_e/regfac_e.htm)

In the post Crisis Period: Globalization & Challenges

• Korea’s FTA Status:
• FTAs in force (11)
• Chile, Singapore, EFTA(4), ASEAN(10), India, EU, Peru, USA, Turkey, Australia, Canada
• FTAs signed (5)
• Columbia, Turkey, China, New Zealand, Viet Nam