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한성대 ODA 컨설팅 (2010년 2학기) 한국의 경제개발경험과 대외원조의 역할 (토) 엄성용 1
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Contents 1 2 3 4 Economic Growth of Korea Economic Take-off
with Outward-Looking Development Strategy 2 3 Role of Foreign Aids in Economic Development 4 Concluding Remarks
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Economic Growth of Korea
1 Economic Growth of Korea
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Overview of Korea’s Economic Development
● Korea achieved rapid economic growth with per capita income rising to roughly 140 times than that of 1960 Liberation from Japanese Colonial Rule 6 Five-Year-Economic- Development Plans Financial Crisis 2005P 1980 1962 1970 1995 5,000 10,000 67 87 11,432 7,355 1953 Per Capita (US$) GNI 1990 1945 16,291 OECD Member 100(1964) 1,000(1977) 1998
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Average GDP Growth Rate
Economic Performances Average GDP Growth Rate 1960s: 8.4% 1970s: 7.4% 1980s: 8.6% 1990s: 6.2% 2000s: 5.6% Export Performances 1977: US$ 10 billion 1989: US$ 50 billion 1995: US$ 100 billion 2004: US$ 250 billion 2006: US$ 325 billion
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Agriculture / Fisheries Agriculture / Fisheries
Changes of Industrial Structure Changes in Employment Structure Changes in GDP Structure Service Sector Agriculture / Fisheries Service Sector Agriculture / Fisheries 1960 36.8 47.3 Manufacturing 15.9 Manufacturing Agriculture / Fisheries Agriculture / Fisheries Manufacturing 2005 Manufacturing Service Sector Service Sector
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Changes in Main Export Commodity
Semiconductor, Mobile Phone, HDTV, Display, Automobile, Ship-building, etc. Export Commodity Profile Wig Textile Automobile Semiconductor 79.8% HCI Product 50% Light Industry Product 14.1% Agricultural Product 6.1% 1960 1970 1980 1990 1999 2003
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2 Economic Take-off with Outward-Looking Development Strategy
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? Economic Conditions of the early 1960s Capital Shortage Abundant
Labor High Level of Education Weak Technology Base ? Strong Economic will Underdeveloped Private Sector
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Basic Philosophy of the 5-year Plan
● Korean economic development should be achieved through industrialization ● Economic development should be achieved under government control and leadership ● Although firms should be owned and managed privately, the government could implement private decisions in the case of major investments ● To finance investments, foreign capital inflows should be induced ● Growth should have a higher priority than redressing imbalances in income distribution and unevenness in industrial development across geographical regions
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Working Mechanism of Outward-Looking Development Strategy
Foreign Capital Inducement (Economic Aids External Debt) Economic Growth Reproduction Export Promotion Manufacturing Processing Private Enterprises Capital Good Imports Raw Material Imports Technology Development Financial Tax Support Well-educated Labor force Foreign Technology Imports Government
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Petro-Chemical Products Heavy and Chemical Industry Development
Heavy and Chemical Industry Development : 1970s Iron and Steel Electronics Petro-Chemical Products Automobile Ship-building Machinery Policy Change Toward Heavy and Chemical Industry Development Mobilizing Financial Resources Selecting National Champions (“Chaebol”) Accelerating Competition
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Strong export promotion
Key Success Factor1 : Strong Entrepreneurship and Government Support Strong export promotion supports high Growth (Export Growth of 30% per annum) Private Enterprises Diligent Workers Strong Entrepreneurship Overseas Marketing and Economic Growth Efficient Economic Policy making Financial Support Marketing Support Tax Support E P B Office of the President Economic Ministries Government Think-tank Economic Policy Design
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Key Success Factor2 : Science and Technology Policy
1960 s 1970s 1970 s 1980s 1980 s 1990s 1990 s 2000s Factor-Driven Stage Factor-Driven Stage Development Development Investment-Driven Stage Stage Stage Investment-Driven Stage cheap labor Innovation-Driven Stage Innovation-Driven Stage Sources of manufacturing capability Competition innovative capability Major Direction Major Direction Expand export- Expand export- Expand heavy Expand heavy Expand Expand Promote Promote Transition to Transition to of of orient light orient light and chemical and chemical technology-intensive high-technology high-technology knowledge-based knowledge-based Industrial Policy Industrial Policy industries industries industries industries industries industries innovation innovation economy economy < New Challenges Scientific Scientific Scientific Scientific R&D and Private R&D and Private Leading Role in Leading Role in Institution Institution Infrastructure Infrastructure Research Lab Research Lab Strategic Area Strategic Area Building Building Setting Setting Promotion Promotion S&T Role S&T Role - HAN - MOST/KIST of - MOST/KIST -GRI -GRI - NRDP - NRDP - Enhancing - Enhancing univ Univ. . . of Government - S&T promotion act - S&T promotion act - - Daeduck sci . town - Promoting private - Promoting private reseach reseach capability capability Government Daeduck sci . town - 5-year economic -R&D promotion act research labs research labs - 5-year economic -R&D promotion act - Promoting co-op - Promoting co-op plan includes -KSIST:highly - Promotion of - Promotion of research plan includes S&T -KAIST:highly research S&T qualified personnel industrial R&D industrial R&D qualified personnel - Policy coordination - GRI restructuring - GRI restructuring Innovative Innovative Capability of Capability of Private Sector Private Sector
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Key Success Factor3 : Education & HRD
● Quantitative profile now: above the OECD average - Education up to college level almost universalized * College Advancement > 80 %; (College Entry/ HS graduate near 100 %) * Net Enrollment for the aged 18~21 = 41%, (No. 5 in the World) ● Superb academic performances: global leader position(TIMSS, PISA etc.) Size and Composition of Educational Investment (2000) (Unit: %) OECD AVG Korea U.S. JPN UK Germany GDP share 5.5 7.7 7.0 4.6 5.3 5.3 (Public-financed) 4.8 4.9 4.8 3.5 4.5 4.3 (Private-financed) 0.6 2.8 2.2 1.2 0.7 1.0 OECD, Education at a Glance 2003 (Korean figures are for 2003 )
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Agricultural Policy and “Saemaul” Movement
● Between 1960 and 1979, Employment (60%→36%) and GDP (39%→19%) share of agriculture declined thus for a more balanced growth: - a shift from low grain-price policy to high grain-price policy: - the Saemaul (new community) movement in 1972 (a massive investment in rural infrastructure): ① rural enlightenment, : the spirit of self-help and cooperation, voluntary participation ② social development : environmental improvements, housing improvements, public utility expansion ③ economic development : buildup of the production infrastructure, income augmentation program
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Pitfalls of Government-led Development and Changes
in Development Strategy : 1980~2000 Financial Suppression Due to Prolonged Government Intervention Over-investment in HCI Inefficient Resource Allocation Increased Production Cost Efficiency Loss Weakened Export Competitiveness 1979 : Negative Export Growth for the first time since 1960 1980 : Negative Economic Growth(-3.9%)
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Delayed Economic Reform and Financial Crisis in 1997
Heavy Corporate Debt Leverage Continued Government Intervention Increased Corporate Failure Deteriorated Financial Soundness Labor Market Rigidity Massive Capital Outflow Denied Rollover of Short-term external Debt South East Asian Crisis IMF Rescue Package
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Crisis Resolution and Economic Recovery
Cleaning up Nonperforming Loans Crisis Resolution Measures Results Expanding Social Safety Net 1 Early Graduation from the IMF Program - Foreign Reserves of more than US$100bn Reducing Moral Hazard 2 Rapid Economic Recovery - GDP Growth: % % Improving Corporate Governance Accelerating Liberalization 3 Social Stability with Productive Welfare System
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Role of Foreign Aids in Economic Development
3 Role of Foreign Aids in Economic Development
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