South Kore Asian Currency Crisis

There is one distinction between the North Korean and South Korean economies that separate them and their ability to last as a substantial economic policy. At the end of the Korean War there was need for both independent countries to establish themselves in the market. The North Koreans decided to practice Juche, which essentially means that they planned on keeping their market and economy localized and not participating in the world trade scene. The South Koreans, on the other hand, did participate in the world market. Both countries knew that in order to establish and survive they would need to have cheap labor and cheap resources. But, once again, South Korea had a helping hand because of their decision to participate in the world market.

In 1997 the country’s exports were no longer booming and the Thai economy entered a unsafe and unpredictable phase. Foreign investors were skeptical about the current-account deficit and the big loans property developers. Bad debt continued to mount up and the stock market crashed to depths not seen in eight years. This caused the baht to fall prey to speculative attack. High debt, heavy borrowing, large current account deficit, and the semi-fixed exchange rate system all played a part to the Thai crisis.

North Korea has a state-led, highly centralized economy because its government is the dominating force in all aspects of the country (Park 2004). In the beginning of its formation, North Korea practically banned all markets and was run by select bureaus and elites. As years passed, there has been slightly more freedom given to the people through various reforms in order to help the dwindling economy stabilize (Park 2004). South Korea has a much more successful, open, and market-based economy. However, most of it is dominated by large and centralized business groups, called chaebols (Campbell II and Keys 2002). North Korea has about 14 million people in its labor force out of a population of 25 million with about 63% of those people working in industry and services while 37% work in agriculture (“Korea, North” 2017). On the other hand, South Korea has a larger labor force of 27.25 million because of a significantly larger population of 50.9 million (“Korea, South” 2017). Almost all of the labor force, about 94.4%, work in services and industry while only 5.7% of people work in agriculture (“Korea, South” 2017). This is because South Korea’s main focus and money source are on industrialized products.

Consequently, North Korea has been able to reverse their 20-year trade deficit into a trade surplus, therefore generating a positive balance-of-payments. Taylor (2013a) indicates that the China’s Ministry of Commerce recorded a trade value of $1.67 billion between them and North Korea in the first quarter of 2012. Taylor (2013b) postulates that because North Korea has access to $6 trillion worth of natural resources and a refugee crisis remains possible if conflicts were to rise and give way to political instability, China is likely to withstand the political corruption and overlook the economic sanctions of others to ensure a cohesive relationship. Additionally, because China exports 70 percent of North Korea’s food and 70-80 percent of their fuel, in the event of a refugee crisis where an influx of North Koreans enter China, China’s exports will ultimately decrease along with an increased imports from a rise in the consumption (Taylor, 2013b). Despite the trade surplus North Korea has recognized over the last couple years, inaccurate exchange rates are causing citizens to not only pay a higher price for goods, but are forcing them to utilize foreign currencies, which can have an adverse effect on China’s exports into the country (Kim, 2013). Regardless of these facts, due to North Korea’s already limited trade relations with other nations, heavy focus on nuclear weapons, and their lucrative trade relations with China, the intended purposes of the United States’ economic sanctions are falling short of expectations (Carbaugh, 2015; Kim,

Despite the state’s staunch resistance to change, the Democratic People’s Republic of Korea (DPRK) has undergone significant development in the century between 1911 and 2011. This essay asserts that until the 1970s, the DPRK underwent consistent political development, which led to exponential national growth; however, the state’s increasing isolationism gave way to political decay. To develop this assertion, the consequences of the Japanese colonisation and later decolonisation of Korea are explored. Furthermore, the Korean war’s repercussions and the state’s reconstruction and growth in the post war period are analysed as evidence of political development. Finally, the state’s stagnation and regression following communism’s fall shall be accounted

At present there are five communist countries in the world, Vietnam, Laos, People’s Republic of China, Cuba, and Democratic People’s Republic of Korea. All of these, with the exception of Cuba, are Asian countries. While Vietnam and China are on the upswing economically, North Korea remains one of the poorest. The reason for this may be because it, along with Cuba, have an entirely state run economy. In comparison to the other three Asian communist countries, North Korea has the lowest GDP per capita of the four at 1800 USD (2008). (1) With North Korea being as centrally located to two of the richest countries, Japan and China, it would seem that they would enjoy some of the same riches of these two. What has caused such differences

South Korea and Japan have had a close relationship from ancient history to the present day. Because of this reason, their economic growth and development have similarities and disparate differences. This paper will discuss some of the two countries’ major characteristics including geographic, social, and political characteristics and look at their histories and economies.

There has been financial crisis across the world since currency came about. It started with the barter system which allowed people to trade goods and services but this sometimes proved to be more difficult than beneficial. Then around 600 B.C., coins and currency came about. Since then currency went from being precious metals to paper money. With the development of currency, came international trade. “Banks and the ruling classes started buying currencies from other nations and created the first currency market. The stability of a particular monarchy or government affected the value of the country 's currency and the ability for that country to trade on an increasingly international market. The competition between countries often led to currency wars, where competing countries would try to affect the value of the competitor 's currency by driving it up and making the enemy 's goods too expensive, by driving it down and reducing the enemy 's buying power (and ability to pay for a war), or by eliminating the currency completely” (Beattie, 2007). Money gets its value by being a medium of exchange, a unit of measurement and a storehouse for wealth. Money allows people to trade goods and services indirectly and understand the price of goods.

Investors tend to limit their investments to those companies domiciled in their own country due to a strong home country bias, which is one of the most enduring and best documented behavioral biases in investing. However, emerging market equities are too large to be ignored, and they represent 24.6% of the world’s market capitalization according to March 2015 data from World Bank. As emerging markets grow over time, they have also become less risky since they are more tightly correlated to developed markets. Regardless of Korea’s political risk, I personally believe South Korea will outperform the global market for the next decade due to several factors including tax supports, its strategic location, and an education system.

During past several years, South Korea's economic growth is very rapid especially during the early 1960s to the late 1990s that the South Korea became a part of the Asian Tigers or Asian Dragons is used for referencing to the highly free and developed economies of Singapore, Hong Kong, South Korea, and Taiwan. The South Korea is the one of the fastest growth developed country in 2000s. Their gross domestic volume increased rapidly around 8 percents per year from US$2.7 billion to US$230 billion in 1962 and 1989 respectively. The rapid growth of South Korea was stimulated by technological change and market-oriented reform over the last two decades. For these reasons, the family income of Korean has increased income equality and escape from being a low income country. As Choo (1979, 1982, 1984) concludes that income inequality in early 80s has improved compared to mid 70s, but still worse than the 60s and early 70s.

North Korea has political system built upon the principle of socialism and centralization. Naturally, the country has drawn attention of many economists as well as politicians. Among various issues concerning North Korea, a topic of Korean reunification has long received economic consideration. Many existing studies estimate economic impact of Korean integration to answer a key question: Is Korean reunification worth pursuing? Some studies further extend the question to find the best way of unifying Korea. Despite heading for the same goal, the studies primarily differ in their methodologies.

Japan and Korea are two of the strongest economies of Northeast Asia and have been very important players in global economy since the start of globalization era. These two economies have major impact on global economy. Both the economies have experienced various external and internal challenges. Therefore, it is important that we look at how these economies have been performing historically, more specifically since 1980s, so that we could get an idea about who might be a more significant player in the global economy in the future.

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

The major industrial prior 1948 was agriculture in Korea peninsula, South Korea was in a sever environment of economic. The war damage and the refugee from North Korea keep South Korea inflation and unemployment.

The Asian crisis was certainly unanticipated. Prior to that, the Government always played an important function in supporting the "Asian miracle” through intervention policies. The Asian miracle was manifested by a rise in revenue and falling poverty rates over a period of 30 years particularly in East Asian countries. Many countries in the region made a complete turn-around from their poverty stricken past into a future filled with economic prosperity.