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ECONOMIC AND SOCIAL ISSUES IN SOUTH KOREA

The Korean economy faces both opportunities and challenges. China has become South Korea’s number one trade partner and the most important destination for South Korean foreign investment. Economic interdependence among the countries of Northeast Asia is increasing. Moreover, the Korea-US Free Trade Agreement (FTA) could provide significant momentum for Korea to upgrade its overall economic system. Other FTAs might follow soon, including one with the European Union.

On the other hand, some experts in South Korea believe that their country is sandwiched between the fast-developing and advanced countries—not yet catching up with the advanced economies, while being chased closely by the rising ones (especially China). They argue that owing to militant labor unions and regulations, the country’s international competitiveness is declining and that South Korea is facing a crisis in technology, profits, market domination, and high-tech industries. As big economies such as China and India expand rapidly and demand grows for energy and raw materials, acquiring these necessities becomes more expensive and difficult in a global market. This situation represents a serious challenge for resource-poor countries such as South Korea.

South Korea is also experiencing problems common to post-industrial societies, such as a gap between the rich and the poor, social polarization, social welfare issues, and environmental degradation. Low fertility is another serious challenge to the Korean economy, as is an aging society that will contribute to a slowdown in economic growth.

What are the strengths and weaknesses of the Korean economy? How will increased trade with the United States and China affect the Korean economy? What are the prospects for economic integration in Northeast Asia and the implications for the Korean economy? And how will Korea's increasing welfare burden affect the economy?

The following topics will be the focus of the POSCO Visiting Fellowship:

  • South Korea’s economic trends and long-term outlook
  • Korea-US Free Trade Agreement: Issues and challenges
  • Prospects for a Free Trade Agreement with the European Union, Japan, or China
  • Asian regionalism
  • Social issues such as low fertility, aging population, social welfare, income distribution, and stress on the environment, including comparisons with other countries

Related to staff

Denny Roy