Korea has achieved economic growth at an unprecedented speed. Observers refer to what it has accomplished the ‘Miracle on the Hangang River,’ as most of its industrial facilities were destroyed during the three-year-long Korean War, and it was devoid of capital and natural resources.
In the early 1960s, South Korea launched export—oriented economic development plans. Initially, the country‘s primary exports consisted of light industrial products manufactured in small—scale factories or raw materials. However, in the 1970s, Korea shifted its focus to investing in heavy chemical facilities, which formed the foundation for the export of heavy industrial products.
The 1988 Summer Olympic Games, also known as Seoul 1988, provided the momentum for South Korea to become a semi-advanced country. As a result, Korea was recognized alongside Taiwan, Singapore, and Hong Kong as one of the ‘four Asian tigers’ by the international media. In December 1996, Korea join the OECD as its 29th member, which is largely composed of advanced countries. This confirmed the rise of Korea from an Asian tiger to a major economic power.
Korea’s exports, which amounted to only USD 32.82 million in 1960, surpassed the USD 10 billion mark in 1977 and soared to USD 644.5 billion in 2021. The country’s GNI per capita was a paltry USD 67 in 1953 around when the government was established, yet it rapidly increased to USD 35,373 in 2021. In response to the scarcity of capital and resources, Korea established an export-oriented economic structure centered around large conglomerates. However, this heavy reliance on exports and imports has made the country susceptible to external economic conditions.
In November 1997, a foreign exchange crisis hit the country, forcing it to turn to the IMF for a bailout. The country took drastic steps such as driving insolvent businesses out of the market and undergoing industrial restructuring. In only two years, Korea regained its previous growth rate and price levels and even achieved a current account balance surplus. In the process, some 3.5 million people joined in the campaign to collect gold to help the government repay the funds borrowed from the IMF. A total of 227 tons of gold were collected. The world marveled at the Korean people’s voluntary participation in the determined effort to repay their national debts. In addition to this, the country also benefited from certain ancillary effects, such as the adoption of globalized economic and financial systems.
After overcoming the economic crisis, the Korea’s economy continued to record solid growth. Its GDP more than tripled from USD 504.6 billion in 2001 to USD 1,664.3 billion in 2022. By 2010, Korea had emerged as the world’s 7th largest exporter. From 2011 to 2014, the country’s trade performance amounted to over USD 1 trillion for four consecutive years. The trade volume retreated slightly in 2015 and 2016 but rebounded to USD 1 trillion in 2017, reaching a record high of USD 1,810.2 billion in 2021. In addition, Korea’s foreign currency reserves amounted to USD 463.1 billion in 2021, deemed a sturdy shield against external shocks. This economic success has been recognized by the international community as well, as reflected in Korea’s steady sovereign credit rating.
In the early 1960s, South Korea launched export—oriented economic development plans. Initially, the country‘s primary exports consisted of light industrial products manufactured in small—scale factories or raw materials. However, in the 1970s, Korea shifted its focus to investing in heavy chemical facilities, which formed the foundation for the export of heavy industrial products.
The cars produced at Hyundai Mortor’s Ulsan factory which are shipped from the export dock and storage yard are one of Korea’s flagship export items.
The 1988 Summer Olympic Games, also known as Seoul 1988, provided the momentum for South Korea to become a semi-advanced country. As a result, Korea was recognized alongside Taiwan, Singapore, and Hong Kong as one of the ‘four Asian tigers’ by the international media. In December 1996, Korea join the OECD as its 29th member, which is largely composed of advanced countries. This confirmed the rise of Korea from an Asian tiger to a major economic power.
Korea’s exports, which amounted to only USD 32.82 million in 1960, surpassed the USD 10 billion mark in 1977 and soared to USD 644.5 billion in 2021. The country’s GNI per capita was a paltry USD 67 in 1953 around when the government was established, yet it rapidly increased to USD 35,373 in 2021. In response to the scarcity of capital and resources, Korea established an export-oriented economic structure centered around large conglomerates. However, this heavy reliance on exports and imports has made the country susceptible to external economic conditions.
In November 1997, a foreign exchange crisis hit the country, forcing it to turn to the IMF for a bailout. The country took drastic steps such as driving insolvent businesses out of the market and undergoing industrial restructuring. In only two years, Korea regained its previous growth rate and price levels and even achieved a current account balance surplus. In the process, some 3.5 million people joined in the campaign to collect gold to help the government repay the funds borrowed from the IMF. A total of 227 tons of gold were collected. The world marveled at the Korean people’s voluntary participation in the determined effort to repay their national debts. In addition to this, the country also benefited from certain ancillary effects, such as the adoption of globalized economic and financial systems.
After overcoming the economic crisis, the Korea’s economy continued to record solid growth. Its GDP more than tripled from USD 504.6 billion in 2001 to USD 1,664.3 billion in 2022. By 2010, Korea had emerged as the world’s 7th largest exporter. From 2011 to 2014, the country’s trade performance amounted to over USD 1 trillion for four consecutive years. The trade volume retreated slightly in 2015 and 2016 but rebounded to USD 1 trillion in 2017, reaching a record high of USD 1,810.2 billion in 2021. In addition, Korea’s foreign currency reserves amounted to USD 463.1 billion in 2021, deemed a sturdy shield against external shocks. This economic success has been recognized by the international community as well, as reflected in Korea’s steady sovereign credit rating.
