Economic Development in South Korea

4346 WordsOct 31, 200818 Pages
At the end of World War II, Korea was a poor former agricultural colony of Japan. But the rapid growth of Korea’s industrial economy has been remarkable. The economy of South Korea is now the third-largest in Asia and the 13th largest in the world by GDP as of 2007. To trace back the economic development of South Korea, the former president Park Chung-Hee played a pivotal role, and was credited for shifting its focus to export-oriented favoring a few large conglomerates. Unlike his predecessors, Park showed a strong commitment to economic development, believing good economic performance as a primary means for enhancing his political legitimacy. Under the President Park Chung-Hee’s era, the government played a dominating role in a…show more content…
As a result of the fixed real exchange rate, it prevented Korean exported goods becoming more expensive relative to competing goods in the world market. The devaluations of Korean won ultimately stimulated exports further. II. Information Services: Quasi-government organizations As a major financial control strategy, the President Park established the Economic Planning Board (EPB) in July 1961. The decision-making in the government became decentralized through granting extensive autonomy to the quasi-government organizations including the Economic Planning Board. The EPB committee was consisted of several policymaking functions of different ministries. The EPB took over the entire budgetary function from the Ministry of Finance, as well as the collection and evaluation of national statistics from the Ministry of International Affairs. The duties included deciding which industries and firms to promote, supervising both the development and the implementation of planning of each ministry’s activities. The EPB was in charge of formulating and monitoring implementations and budget of Five Year economic development plans. Detailed information was reported to the President at the monthly economic briefings. Consequently the EPB became more influential in economic planning decisions, and their growth greatly strengthened the power of Ministry of Commerce and Industry. As one of the export promotion strategy, the government created the
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