South Korea, Economy
rapid industrialization, economic aid, economic planning, Korean War, economic system
South Korea’s economy, traditionally based on agriculture, has undergone extraordinarily rapid industrialization since the early 1960s. After the Korean War (1950-1953), economic aid, especially from the United States and Japan, was important to the economic recovery and growth of the country. Subsequently, in the span of a generation, South Korea grew from one of the world’s poorest countries to one of its most promising industrial powers. With the country’s gross domestic product (GDP) expanding by more than 9 percent yearly between the mid-1960s and the mid-1990s, economic observers often called South Korea one of Asia’s “Four Tigers” (joining Singapore, Hong Kong, and Taiwan). Nevertheless, South Korea was one of many Asian countries that suffered economic decline during a regional economic crisis in 1997 and 1998. The country’s economy showed strong signs of recovery in 1999 and sustained growth into the early 2000s.
South Korea has a market-based economic system. At the same time, the government is involved in economic planning and is highly influential in the direction of economic development. The government’s economic plans have consistently given priority to the development of manufacturing, driving export-led growth in South Korea. In 1997 annual national budget figures showed revenues of $95.4 billion and expenditures of $83 billion. The GDP in 2000 stood at $457.2 billion.
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