For the period 1970-2018. South Korea's GDP at current prices increased by $1,711.3 billion (186.4 times) to $1,720.5 billion; the change was $5.5 billion due to a population growth of $19.0 million, and $1,705.8 billion due to a $33,340.0 increase in GDP per capita. South Korea's average annual GDP growth was $35.7 billion, or 11.5%. The average annual GDP growth of South Korea at constant prices is 6.9%. The share in the world increased by 1.7%. The share in Asia increased by 3.6%. The minimum GDP was in 1970 ($9.2 billion). The maximum GDP was in 2018 (1,720.5 billion dollars).

During 1970-2018. GDP per capita in South Korea increased by $33,340.0 (117.2 times) to $33,627.0. The average annual increase in GDP per capita in current prices was $694.6 or 10.4%.

The change in the GDP of South Korea is described by a linear correlation-regression model: y=35.0x-69 332.1 , where y is the estimated value of the GDP of South Korea, x is the year. Correlation coefficient = 0.952. Coefficient of determination = 0.907.

South Korean GDP, 1970

South Korea GDP in 1970 it amounted to 9.2 billion dollars, ranked 38th in the world and was at the level of the GDP of Chile (9.7 billion dollars), the GDP of Bulgaria (9.0 billion dollars). The share of South Korea's GDP in the world was 0.27%.

In 1970, it was $287.0, ranked 126th in the world and was at the level of GDP per capita in Honduras ($303.0), GDP per capita in Guatemala ($302.0), GDP per capita in Morocco ($290.0), GDP per capita in Samoa ($289.0), GDP per capita in Senegal ($289.0), GDP per capita in Ivory Coast ($286.0), GDP per capita in Syria ($276.0), GDP per capita in Paraguay ($275.0), GDP per capita in Cape Verde ($270.0) South Korea's GDP per capita was less than the world's GDP per capita ($924.0) by $637.0.

Comparison of the GDP of South Korea and neighbors in 1970. The GDP of South Korea was larger than that of North Korea ($4.9 billion) by 87.4%, but was less than that of Japan ($212.6 billion) by 95.7%. GDP per capita in South Korea was less than GDP per capita in Japan ($2,026.0) by 85.8%, GDP per capita in North Korea ($386.0) by 25.6%.

Comparison of South Korea's GDP and leaders in 1970. South Korea's GDP was 99.1% less than the US GDP ($1,073.3 billion), the USSR's GDP ($433.4 billion) by 97.9%, Germany's GDP ($215.8 billion) by 95.7%, Japan's GDP ( 212.6 billion dollars) by 95.7%, French GDP (148.5 billion dollars) by 93.8%. GDP per capita in South Korea was 94.4% less than GDP per capita in the United States ($5,121.0), GDP per capita in France ($2,853.0) by 89.9%, GDP per capita in Germany ($2,747.0) dollars) by 89.6%, GDP per capita in Japan (2 026.0 dollars) by 85.8%, GDP per capita in the USSR (1 788.0 dollars) by 83.9%.

South Korea's GDP potential in 1970. With GDP per capita at the same level as the US GDP per capita ($5,121.0), South Korea's GDP would be $164.7 billion, 17.8 times the actual level. With GDP per capita at the same level as the GDP per capita of Japan ($2,026.0), the best neighbor, South Korea's GDP would be $65.2 billion, 7.1 times the actual level. With GDP per capita at the same level as the world's GDP per capita ($924.0), South Korea's GDP would be $29.7 billion, 3.2 times the actual level. With GDP per capita at the same level as East Asia's GDP per capita ($331.0), South Korea's GDP would be $10.6 billion, 15.3% more than the actual level.

South Korea GDP, 2018

South Korea GDP in 2018 was equal to 1,720.5 billion dollars, ranked 10th in the world and was at the level of Canada's GDP (1,712.6 billion dollars), Russia's GDP (1,660.5 billion dollars). The share of South Korea's GDP in the world was 2.0%.

GDP per capita in South Korea in 2018 was $33,627.0, ranked 38th in the world and was at the level of GDP per capita in Italy ($35,164.0), GDP per capita in Kuwait ($33,761.0), GDP per capita in Malta (33,672.0 dollars). The GDP per capita in South Korea was greater than the GDP per capita in the world ($11,230.0) by $22,397.0.

Comparison of GDP of South Korea and neighbors in 2018. South Korea's GDP was 98.4 times larger than North Korea's ($17.5 billion) but was 65.4% less than Japan's ($4,971.3 billion). The GDP per capita in South Korea was 49.0 times greater than the GDP per capita in North Korea ($686.0) but was less than the GDP per capita in Japan ($39,087.0) by 14%.

Comparison of South Korea's GDP and leaders in 2018. South Korea's GDP was less than that of the United States ($20,580.2 billion) by 91.6%, China's GDP ($13,608.2 billion) by 87.4%, Japan's GDP ($4,971.3 billion) by 65.4%, GDP Germany (3 949.5 billion dollars) by 56.4%, UK GDP (2 855.3 billion dollars) by 39.7%. GDP per capita in South Korea was greater than GDP per capita in China ($9,617.0) by 3.5 times, but was less than GDP per capita in the United States ($62,981.0) by 46.6%, GDP per capita in Germany (47 993.0 dollars) by 29.9%, GDP per capita in the UK (42 889.0 dollars) by 21.6%, GDP per capita in Japan (39 087.0 dollars) by 14%.

South Korea's GDP potential in 2018. With GDP per capita at the same level as US GDP per capita ($62,981.0), South Korea's GDP would be $3,222.4 billion, 87.3% more than the actual level. With GDP per capita at the same level as the GDP per capita of Japan ($39,087.0), the best neighbor, South Korea's GDP would be $1,999.8 billion, 16.2% more than the actual level.

South Korean GDP, 1970-2018

year	GDP, billion dollars	GDP per capita, dollars	GDP, billion dollars	GDP growth, %	share of South Korea, %
	current prices		constant prices 1970		in the world	in Asia	in East Asia
1970	9.2	287.0	9.2		0.27	1.8	2.8
1971	10.1	309.0	10.2	10.5	0.27	1.8	2.8
1972	11.1	332.0	10.9	7.2	0.26	1.6	2.4
1973	14.2	416.0	12.5	14.8	0.27	1.6	2.3
1974	20.0	574.0	13.7	9.5	0.33	1.8	3.0
1975	22.3	629.0	14.8	7.9	0.33	1.9	3.0
1976	30.6	850.0	16.8	13.1	0.42	2.3	3.8
1977	39.3	1 076.0	18.8	12.3	0.48	2.5	4.0
1978	53.0	1 434.0	20.8	10.8	0.55	2.6	4.0
1979	68.3	1 820.0	22.6	8.6	0.62	3.0	4.7
1980	66.7	1 752.0	22.3	-1.7	0.54	2.6	4.3
1981	74.3	1 925.0	23.9	7.2	0.59	2.7	4.4
1982	79.8	2 036.0	25.8	8.3	0.64	3.0	5.0
1983	89.3	2 246.0	29.2	13.2	0.69	3.2	5.1
1984	99.1	2 459.0	32.3	10.4	0.75	3.4	5.4
1985	102.9	2 521.0	34.8	7.7	0.76	3.6	5.3
1986	118.5	2 872.0	38.7	11.2	0.76	3.3	4.5
1987	149.9	3 596.0	43.5	12.5	0.85	3.5	4.7
1988	202.1	4 801.0	48.7	11.9	1.0	4.0	5.2
1989	249.8	5 879.0	52.1	7.0	1.2	4.8	6.2
1990	286.6	6 677.0	57.3	9.8	1.2	5.1	7.0
1991	334.2	7 704.0	63.2	10.4	1.4	5.4	7.2
1992	359.1	8 189.0	67.1	6.2	1.4	5.3	7.0
1993	396.3	8 938.0	71.7	6.8	1.5	5.2	6.8
1994	467.4	10 427.0	78.3	9.2	1.7	5.8	7.4
1995	570.5	12 595.0	85.8	9.6	1.8	6.2	7.9
1996	613.6	13 410.0	92.3	7.6	1.9	6.8	9.0
1997	571.9	12 379.0	97.7	5.9	1.8	6.6	8.9
1998	383.9	8 234.0	92.4	-5.5	1.2	4.9	6.5
1999	497.8	10 586.0	102.8	11.3	1.5	5.7	7.5
2000	576.2	12 159.0	112.0	8.9	1.7	6.1	8.0
2001	547.7	11 478.0	117.5	4.9	1.6	6.2	8.2
2002	627.2	13 066.0	126.5	7.7	1.8	6.9	9.4
2003	702.7	14 560.0	130.5	3.1	1.8	7.0	9.6
2004	793.2	16 355.0	137.3	5.2	1.8	7.0	9.8
2005	934.9	19 194.0	143.2	4.3	2.0	7.5	10.9
2006	1 053.2	21 540.0	150.8	5.3	2.0	7.8	11.8
2007	1 172.6	23 900.0	159.5	5.8	2.0	7.7	11.9
2008	1 047.3	21 279.0	164.3	3.0	1.6	5.9	9.2
2009	943.9	19 116.0	165.6	0.79	1.6	5.3	7.9
2010	1 144.1	23 088.0	176.9	6.8	1.7	5.5	8.4
2011	1 253.2	25 193.0	183.4	3.7	1.7	5.2	8.0
2012	1 278.4	25 593.0	187.8	2.4	1.7	5.0	7.6
2013	1 370.8	27 323.0	193.7	3.2	1.8	5.2	8.1
2014	1 484.3	29 459.0	199.9	3.2	1.9	5.5	8.4
2015	1 465.8	28 971.0	205.6	2.8	2.0	5.5	8.2
2016	1 500.1	29 534.0	211.6	2.9	2.0	5.4	8.1
2017	1 623.9	31 852.0	218.3	3.2	2.0	5.5	8.3
2018	1 720.5	33 627.0	224.1	2.7	2.0	5.4	8.1

picture. South Korean GDP, 1970-2018

picture. GDP per capita in South Korea, 1970-2018

picture. GDP growth in South Korea, 1970-2018

South Korea GDP by spending

South Korea GDP by expenditure, %, 1970-2018

Indicator		1970	1980	1990	2000	2010	2018
Consumer spending		84.4	74.7	61.1	65.4	64.6	64.1
including	Household spending	74.8	63.1	50.3	54.5	50.4	48.0
	Government spending	9.5	11.6	10.8	10.9	14.2	16.1
Private investment		26.3	34.4	39.6	32.9	32.6	31.3
Net export		-9.5	-8.7	-0.74	1.8	2.8	4.6
GDP		100.0	100.0	100.0	100.0	100.0	100.0

ECONOMIC DEVELOPMENT OF SOUTH KOREA

I.V. Novikov, student V.A. Utkina, student

Far Eastern Federal University (Russia, Vladivostok)

Annotation. The paper analyzes the economic growth rates of South Korea as the most successful example of an effective state and economic policy among developing countries. The author describes the main factors that influenced the growth country's GDP in the period from 1962 to the present. Key words: South Korea, economy, GDP, development, consumption.

Korea is currently a clear example of the successful economic development of the country. A state without significant natural resources, devastated by war, with a per capita income of less than $100 in 1962, reached $10,000 by 1995, and had an average annual GDP growth of 10%. Currently, Korea ranks 13th in the production of goods and services, is the 8th largest trader in the world, and has a per capita income of more than $25,000 per year. It is one of 60 countries that had a per capita income of less than $300 in 1960, but Korea was able to raise this figure to $10,000 by 1995. Korea also became the second country after Singapore to withdraw from the lending program during the Asian financial crisis. World Bank.

Research into the reasons for this significant economic growth in South Korea is ongoing. For example, scientists point to the accumulation of human capital as a source of growth, but its contribution to the development of the economy was less than 10%. Along with this, the role of education, training and dissemination of knowledge, which undoubtedly played an important role in the development of Korea, is considered. However, they cannot be considered major factors, since it is known that between 1962 and 1994 the government did not spend more on education than other developing countries with the same level of per capita income. According to the majority

According to researchers, such an impressive growth rate of the Korean economy is the result of annually growing investments that exceed 30% of the country's GDP, with a significant part of them coming from official foreign financial assistance.

Official foreign support for Korea.

The scale and types of official foreign aid.

During the social and economic development of South Korea from 1945 to 1999, the total amount of official foreign financial assistance is about 44 billion US dollars at current prices. This includes approximately $7 billion in government development grants and $37 billion in community development loans. Thus, the total amount of loans is divided into "Official Development Assistance" of $6 billion (grants are more than 25%) and "Other official assistance" of $25 billion (grants are less than 25%). At a time when the amount of financial assistance received by Korea between 1965 and 1995 was comparable to that of other 59 developing countries, with a per capita income of less than $300 in the 1960s, Korea achieved an average annual GDP growth of 2% . However, the other 15 developing countries achieved GDP growth of 10%, so it cannot be said that the rapid growth of the Korean economy is due only to foreign investment.

The main "donors" of financial assistance were the United States, Japan and Germany. The main multilateral donors were the United Nations, the United Nations Reconstruction Agency in Korea, and the International Development Bank.

Distribution of financial assistance

Since most of the grants and loans were directed mainly to food and emergency needs, and loans for social development accounted for 84% of the total official investment, the use of these funds actually reflects the government's strategy in the development of the country, so, despite the financial crisis 51% of investments were directed to the development of infrastructure, 24% to the modernization of the production sector, and about 12% to the social infrastructure sectors. This model of distribution of funds differed from those used in other developing countries, for the better, therefore, rational sectoral distribution of financial assistance can also be added to the number of factors for economic growth.

The current economic situation: general economic activity.

As of today, economic growth continues at a moderate pace. Growth for 2017 is projected at 2-2.8%, and by 2018 this figure should reach 3%. This is due to the fact that the development in the service sector remains at a sufficient level, but the level of growth industrial production and the corresponding share of use production capacity remain at a low level. It is expected that the growth of the country's economy will be carried out due to a moderate recovery in demand in the domestic market and growth in exports. But all these prospects are based on the assumption that the world economy will also increase its growth rate. Also, along with the decrease in interest rates on loans, their number has increased dramatically, which significantly affected the current state of the country's economy.

Domestic consumption fell by 3.5% last year, and this figure continues to decline slowly. This is due to a slowdown in global economic growth, a decrease in private consumption and investments related to construction, in connection with this, GDP growth amounted to 2.3% compared to the planned 2.7%. The level of domestic consumption plays a significant role in the Korean economy, since its share in the formation of the country's GDP is 46.5%.

In 2014, investment in fixed assets amounted to 7%, and strongly affected the growth of the economy, which suffered during the economic crisis. But some reductions in investment in the electrical industry and electronic technology are due to increased competition in the electrical goods market, and therefore demand for this category of products has also decreased. But more positive forecasts are aimed at investment in the construction industry, which has been stagnant since the global financial crisis, until the shortage of funds in 2013. But after that, investments in construction increased sharply, and by the end of 2013 they accounted for 6.7%, and every year this figure continues to increase by an average of 1.9%. At the same time, the number of transactions in the real estate sector has increased, despite the fact that prices continue to rise. For 2017, real estate investment is projected to grow by at least 4.5% compared to last year.

Today's forecasts show that the Korean economy will continue to grow at a moderate pace if domestic and external conditions remain favorable, but there are concerns about consumer debt, which significantly affects the country's economy. At the same time, given the weakening of domestic consumption and low inflation in the face of international economic uncertainty, there is a need to maintain an expansive macroeconomic policy, in which a significant role is given to foreign investment, and together with

By this tax and budgetary policy at a high level, in order to maintain the high, must continue to maintain and sustain the steady growth of the Korean economy. stimulate economic activity

Bibliographic list

1. Zubchenko L. Foreign investments. 2012. S. 182-186.

2. Sharma R. Breakthrough economies. In search of the next economic miracle. 2013. S. 350-352.

3. Bulatova A.S. Countries and regions of the world: an economic and political reference book. 2010. S. 700-704.

4. Lomakin V.K. World economy: Textbook for universities. - M.: Finance. 2002. S. 730735.

5. Republic of Korea - economic development continues // BIKI No. 106. 2005.S.16;

6. On the development of the South Korean economy // BIKI No. 40. 2005. P.16;

7. Krupyanko I. Geopolitics of East Asia today and tomorrow. 2006. S. 48-60.

ECONOMIC DEVELOPMENT OF SOUTH KOREA

I.V. Novikov, student V.A. Utkina, student Far Eastern federal university (Russia, Vladivostok)

abstract. The paper analyzes South Korea's economic growth rate as the most successful example of effective state and economic policy among developing countries. The author describes the main factors that influenced GDP growth in the period from 1962 to the present. Keywords: South Korea, economy, GDP, development, consumption.

According to the published results of the World Bank, in 2017 the GDP of South Korea amounted to 1.53 trillion dollars, which allowed it to take 11th place in the world ranking. Russia, in turn, took only 12th place in the world, its GDP amounted to 1.46 trillion dollars. Small South Korea surpasses huge Russia both in terms of economic power and per capita income. So why is Russia's influence on the international stage so much greater than that of South Korea? Why is it still considered one of the leading countries in the world?

State power is a complex concept that includes: population, area of ​​the country, economic power, industrial structure, military potential, and so on. The power of the state is not enough to compare only with the help of dollars. The area of ​​Russia exceeds the area of ​​Pluto, and Russia also has a powerful military force and rich nuclear arsenal. Russia is a permanent member of the UN Security Council, can veto any Security Council resolution. Compared to South Korea, Russia is without a doubt a world power, it has a huge influence in the world in such areas as culture, economy, military affairs, politics, as well as in the scientific and technical field.

In recent years, Russia has been very active on the world stage. It seems that Russia, along with the United States, is considered a world power. Why are they so strong?

First, the Russian economy is developing very rapidly. From 1991 to 1999, there was a period of serious economic recession in Russia, but in all subsequent years, rather high economic growth rates remained. In 1999, Russia's GDP was negligible (less than Malaysia's) at only $196 billion. After Putin came to power in 2000, Russia entered a period of rapid development. On the one hand, international energy prices continued to rise and brought huge profits to Russia. On the other hand, Putin managed to win over the Russian oligarchy and nationalize the economy. Income from the sale of energy resources was already replenishing the state budget, and not the pockets of the oligarchs.

© RIA Novosti, Boris Babanov

In 2013, Russian GDP exceeded $2.1 trillion, which is 11 times more than in 1999. The level of per capita income exceeded 10 thousand US dollars and entered the ranks of developed countries with a high level of income. In 2014, Russian oil production was 520 million tons, up 0.7% year-on-year, and daily oil production was 10.57 million barrels, a new post-Soviet record.

In addition to the rapid development of the energy industry, Russia has also achieved success in the production of crops. In 2014, Russia produced about 90 million tons of grain, and in 2017 it achieved a record production of 134 million tons, while exports amounted to 47 million tons. The active production of grain allowed Russia to cope with Western sanctions and gain sufficient confidence. Cereals not only satisfy domestic demand, but are also sold abroad.

There are two main reasons why the Russian armed forces are at the forefront of the world. First, Russia is a traditional military power with one million soldiers. The land, sea and air military forces are fairly balanced. Armed forces is the legacy of the Soviet Union. Russia is a military-industrial power, which is why it is considered a world leader in military affairs.

Secondly, Russia has significant strategic forces. The number of intercontinental missiles and nuclear warheads on submarines is the same as that of the United States. Nuclear weapons are the most important means of ensuring national security. In addition, Russia does not experience any difficulties in this area - projects for the production of intercontinental missiles and strategic nuclear submarines are constantly supported by the government.

Following the rise in oil prices, the Russian economy began to develop rapidly, and military spending doubled. In 2014, military spending amounted to $80 billion. Russia is carrying out drastic reforms in the army and in the defense industry. The size of the Russian army is half the size of the People's Liberation Army of China, so in recent years Russia has been rapidly restoring its military power. In 2017, the level of modernization of Russia's main armed systems reached 60%. The level of modernization of the armed forces refers to all the innovations in the army that have occurred since the collapse of the Soviet Union. But still about 40% of military equipment is the old developments of the USSR. Russia experiences the greatest difficulty in the production of naval vessels, since the times of the USSR they have not changed in any way. Russia has not yet been able to establish the production of engines for warships, so new types of aircraft carriers and cruisers remain only on paper.

© REUTERS, Sergei Karpukhin T-14 Armata tanks at a military parade

Compared with the decline of the Navy, the development of the Air Force in Russia has achieved excellent results. In 2013, the Russian border air force received 67 new aircraft, 18 improved aircraft and 100 helicopters. In 2014, Russian troops received 120 aircraft and 90 helicopters. Over the past three years, Russia has annually delivered more than 100 combat aircraft to the army, by 2020 it is planned to purchase a total of 1,591 aircraft and a helicopter.

Russia was able to enrich itself thanks to the rise in energy prices that began in 2000. At the end of 2000, Putin came to power in Russia and at the same time the 10-year period of crisis ended, federal budget revenues increased significantly, and balance of payments was observed for the first time. By 2008, the Russian economy had made great strides. With a $450 billion foreign exchange reserve accumulated from the sale of oil and gas, Russia gained enough confidence to attack Georgia. (we are talking about the armed conflict in South Ossetia in August 2008 - approx. transl.).

Context

Russia's GDP - at the level of a Chinese province

Hexun 06.12.2017

Muscle Putin? And GDP at the level of Italy ...

Atlantico 26.10.2016

Ukraine is sliding into the abyss of poverty

Correspondent 03.11.2017

In 2013, world oil prices topped $100 a barrel, while Russia's military spending skyrocketed to 4% of the country's GNP, equal to that of the United States. At this time, Russian investment in the army and the military industry reached its peak in the last 15 years. In 2014, compared to 2013, military spending exceeded 4%, which at the time put a lot of pressure on NATO. In the same year, a political crisis broke out in Ukraine, Russia did not stand aside and took part in the division of Ukraine - in early 2014, it regained Crimea.

Whenever Russia interferes in the affairs of foreign countries, it is invariably linked to oil prices. Despite the fact that Russia has experienced an economic downturn since 2014, the state still allocates considerable funds for the maintenance of the army. Increasing stability in the economy over the next ten years will give Vladimir Putin a certain degree of confidence to advance his own political, economic and military interests in Ukraine, while acting on an equal footing with European countries and the United States. The “lesson of Georgia”, the annexation of Crimea, active intervention in the affairs of Ukraine and Syria, the complete re-equipment and modernization of the army according to a modern model, as well as successful military operations abroad, contributed to changing the deplorable situation in which Russia found itself after the Cold War.

The materials of InoSMI contain only assessments of foreign media and do not reflect the position of the editors of InoSMI.

South Korea has a booming economy that was given a chance to recover quickly after World War II and the end of the Korean War. Successful government reforms and a well-thought-out modern economic policy contribute to the constant growth of GDP and improve the quality of life of the inhabitants of the state.

Prerequisites for reform

After the end of World War II, the country split into two parts - North and South. Thus, traditional ties in the agrarian sector, industry and production were broken. The main agricultural lands were in the South, which had been agricultural for centuries. Industrial and production resources were located in the North. Because of the division, South Korea has lost such important industries as cement, chemical and metallurgy. It was possible to save plants and factories that specialized in the production of food and light industry products.

In 1945, the United States, France and Britain provided financial and material assistance to the national economy, but this did not finally help to overcome devastation and poverty.

The Allies developed a special plan for the gradual recovery of the economy. Activities such as:

• United States in 1954 to 1959 provided $1.5 billion in loans and subsidies to South Korea.
• A gradual increase in GDP began.
• There was a doubling of production.
• The number of unemployed and partially unemployed by 1958 was almost 37%.

Despite some success, the economic situation in South Korea remained very bad. Firstly, there were practically no minerals in the state. Secondly, the country has a hilly terrain and relief, which hindered the active development of agriculture. Thirdly, there were no qualified workers and engineers to raise the industry.

Rebuilding the South Korean way

In the early 1960s General Park Chung-hee came to power, who understood the need for urgent changes in all spheres of life, but priority was given to the economy. His policies were based on state capitalism and a free economy. The basis of the reforms was the introduction of centralized management, which made it possible to quickly get rid of the agrarian past and break into the industrial world. The main reforms that Park Chung Hee has introduced include:

• Creation of chaebols - large private conglomerates with various activities.
• The transition of transport, energy, port communications under the authority of the state. The water supply was also controlled by the government.
• The banking system, the agricultural sector, the national economy and agriculture have been nationalized.
• Peasants were exempted from paying debts to usurers.
• Supported prices for agricultural products.
• Banks began to attract investments and loans.
• They borrowed money from other states, creating special tax breaks for them. The main investors were the United States and Japan.

Park Chung Hee's government sought to reduce unemployment, create effective system economic management, promote the development of industry, increase exports and labor efficiency.

The main sectors of the economy are:

• Auto industry.
• Shipbuilding.
• Electronics.

It was in these areas that the opening of enterprises and the provision of state loans were supported. Reconstruction was carried out in the export sector, the military-industrial complex, construction.

The creation of chaebols, which were engaged in the service sector, trade, production, export, communications, and electronics, had a favorable effect on development. The development of chaebols was given large sums from investors and from the state. The largest conglomerates were Samsung, Daewoo, Hyundai, Goldstar.

Successful Five Years

The government's transformation program was based on 5-year plans, developed taking into account the situation in the country. The first five-year plans were especially important:

• 1962-1966 – restoration of the production of mineral fertilizers and electricity, petrochemical and cement industries.
• 1967-1971 – modernization of steel production, development of machine-building, chemical industries.
• 1972-1976 – the emphasis was placed on turning the economy into an export-oriented one. At this stage, investments were mainly made in the heavy, oil refining, chemical industries, mechanical engineering, and electronics.
• 1977-1981 - began to produce products that were competitive in other countries and other markets. main role knowledge-intensive industries played, which made it possible to significantly increase exports up to 45%.

Further five-year plans continued the policy begun by the government of the general in the 1960s. Park Chung Hee's focus on exports quickly widened the gap between the agricultural and industrial sectors. Reforming through five-year plans was not without problems. At first, only cheap goods and products were produced, which resulted in the implementation of a policy of protectionism and the ability of South Korean products to compete with goods from other countries.

Exports in the late 1970s was limited by the global crisis and the increase in oil prices. After several years of constant inflation and negative GDP figures, the government in the 1980s. moved to large-scale structural restructuring of the economy.

By the end of the decade, the first signs of economic recovery began to appear. In particular, GDP growth increased by an average of 9% per year, prices for consumer goods rose, and the domestic market stabilized, which became the basis for economic development. The government began to gradually move from the export of goods to the self-sufficiency of the population. Such a measure was necessary in order to reduce dependence on investments from other states.

The economy of South Korea in the late XX - early XXI centuries.

Since the 1990s the country began to gradually integrate into the world system of economic relations, gaining membership in regional and international organizations. If in the first half of the 1990s there was a certain decline in exports and economic growth, then in subsequent years the situation gradually improved. Although the crisis of 1997, which hit the whole world, caused the depletion of gold and foreign exchange reserves, the depreciation of the won, and the growth of unemployment.

The leadership of South Korea quickly reacted to the deterioration in the economy and carried out a number of anti-crisis measures. As a result, the economy began to grow again, reaching 9-10% every year. The world economy at the beginning of the twenty-first century. showed a decline in production and exports, and then the financial crisis broke out, which began in the United States.

To cope with the negative phenomena allowed a set of measures, including:

• Large-scale restructuring of chaebols.
• Privatization of banking structures.
• Liberalization of the economy.
• Activation of foreign trade, including with China.
• The fight against the depreciation of the won, which attracted foreign exporters.

The main export items in 2004-2018. are consumer goods, ships, steel, rice. The gradual relaxation of the policy of protectionism over agriculture has allowed to reduce the price of rice domestically and on world markets.

Foreign states are willing to buy electronics, agricultural products, manufactured goods. Since 2009, the economy began to show positive trends of a stable nature, which allowed South Korea to enter the TOP-20 in terms of GDP, per capita income, economic growth and development.

Structure of the financial and banking system

It began to form after the end of the war and the appearance of two Koreas on the peninsula. There are several groups of financial institutions:

• Central bank.
• Non-banking organizations - venture funds, insurance companies.
• banking institutions.

Non-banking institutions appeared in the country immediately after the diversification of financial resources and stimulation of cash flows. It happened in the 1970s, which attracted investors from abroad. A decade later, such structures, like commercial banks, became objects of accelerated liberalization and their introduction into the international market system.

In the 1960s specialized banks were formed, whose activities were aimed at supporting those sectors of industry determined by the five-year plans. Now such structures are engaged in agriculture, foreign trade, fishing, and industrial production.

The Central Bank is the main financial institution in South Korea, which appeared in 1950 to issue the national currency. Also, the duties of the Central Bank included the conduct of credit, monetary and foreign exchange policy, to regulate the activities of non-state banks. The employees of the Central Bank collected data and information about the financial system of South Korea, determined which areas to lend, which banks to support.

Leading Industries

Production in the South Korean state began to develop steadily since the mid-1970s. Since then, the gross national product has been constantly growing, varying within 9-10%, and falling in times of crisis to 2-3%.

For centuries, agriculture and the agrarian sector developed in the southern part of the Korean Peninsula, which were in a state of complete decline with the creation of North and South Korea. In this regard, there has been a reorientation of industry and a decrease in the share of agricultural land. Reforms of the 1960s - 1970s contributed to the emergence of industries such as:

• Textile.
• Construction.
• Automotive.
• Shipbuilding.
• Electronics.

Hyundai is the leader in the automotive industry, and the entire sector accounts for about 9.5% of value added, more than 8% of exports, providing employment for almost 7.5% of the country's population. In the world part of automobile production, South Korean auto production reaches 5-6%. Together with the Hyundai company, Kia Motorm, Daewoo, SsangYong Motor Company, Renault Samsung Motors send their goods to the world market. About 3-4 million cars are exported every year, about 1.6 million cars are sold within the state.

Shipbuilding began to develop rapidly in the 1970s, turning into the XXI century. in one of the main industries. South Korea is building, renovating and converting various kinds ships and vessels. This contributed to the development of related industries, which include electronics, chemical, metallurgical industries. The shipyards are owned by three companies:

• Hyundai Heavy Industries.
• Daewoo Shipbuilding and Marine Engineering.
• Samsung Heavy Industries.

There are also smaller firms that own docks and shipyards, but the main percentage of ships are built by these corporations.

The state not only creates new ships, but also develops the production of complex and so-called expensive ships - tankers, gas carriers, large containers for cargo. During the construction, new technologies, achievements from the field of electronics are used.

The mechanical engineering sector is the largest and strongest in the country, and is constantly suffering from global economic and financial crises. Many enterprises either open or close, but this does not prevent the stable production of turbines, tools for metal processing, mining, refrigeration equipment, and agricultural machinery.

Also, the leading sectors of the South Korean economy are metallurgy and the petrochemical industry. Metallurgical products from this Asian country are constantly in demand in foreign markets. As for the oil and chemical sectors, the demand for goods produced at the enterprises of industries is expanding both in the state itself and beyond its borders. The main directions of the petrochemical industry are:

• resins.
• fibers.
• rubbers.

Textile production is developing with reference to exports and market demands, sending 2/3 of manufactured products to other countries. The main competitors in the textile market are the United States, Germany, Italy, China. Interestingly, the South Korean government is investing more in the Chinese textile industry than in neighboring countries. After China, injections are made to the USA, the Philippines, Sri Lanka, Indonesia, Guatemala, etc.

Along with the industries formed in the early 1950s, more modern areas of production are also actively developing. We are talking about energy, high-tech, telecommunications, semiconductors. The main feature of these directions is that they have spread not only in Asia, but throughout the world, thanks to consumer demand and support.

Agriculture

It has a long tradition of development, which is facilitated by the monsoon type of climate, which is characterized by humid summers and cold, dry winters. In such conditions, the ancient Koreans, like modern ones, were engaged in the cultivation of rice, which was the main agricultural product. Almost 80% of farms are engaged in the cultivation of rice, then giving it to domestic needs, since it is reluctant to buy it in foreign markets due to its high cost. In this regard, the government promotes the cultivation of other cereal crops - barley, wheat, millet.

Climatic and natural conditions made it possible to grow many types of vegetables and fruits in the south of the Korean Peninsula, breed animals, and engage in forestry. In particular, they grow apples and peaches, which Sri Lanka, Indonesia, and China are willing to buy.

The development of agriculture contributed to the emergence of related industries and the creation of new jobs. This is how the food industry arose, began to produce mineral fertilizers to develop farming and fishing.

Who provides services?

South Korea is a young country in many respects, but its economy has already managed to enter the TOP of the best in the world. And not the last role in this is played by the service sector, which is provided by various companies, structures, firms. All due to the fact that tourism and its various directions are actively developing in the state, retail trade, sports, culinary advances, modern resorts are being built. The list of the most popular South Korean services includes:

• Insurance.
• Sphere of catering.
• Laundries.
• The medicine.
• Entertainment and leisure.
• Retail.

The latter sector began to develop dynamically from the mid-1980s, when Koreans massively opened shops, shops, and kiosks. The assortment in such outlets was rather limited, and most often, it was made by members of the same family. Gradually, other service-oriented enterprises began to emerge. This is how cafes, restaurants, small hotels and hostels appeared.

Economic Miracle: Results

For more than twenty years, the South Korean economy has been showing positive dynamics. In particular, GDP grows every year by 9-10%, in some years it even reached 14%. Other results include:

• The export of Korean goods is actively growing, which allowed South Korea to take the 8th place in the world in terms of product exports.
• Investment of currency in the economy of the state.
• Expansion of international trade, from which revenues are growing, reaching up to 700-800 billion US dollars per year.
• South Korea ranks fifth in the export of technology and technological products, only behind China, Germany, the United States, and Singapore.
• The country has taken a leading position in the world in shipbuilding. New companies are being built all the time, which control 40% of the world's orders for the construction of ships.
• The productivity of workers has grown sharply, surpassing even the Japanese in terms of workaholism.

Why South Korea succeeded: a hard road to success

The country's natural resources are limited, which has not prevented its government from carrying out successful economic reforms. The following factors contributed to the implementation of a successful startup:

• Economic development has become a priority and central to government reforms. The management decided to lower tariffs on imports and stimulate the growth of exports by attracting exporting entrepreneurs. Business received various quotas, subsidies, loans. The consequence of this was a constant and stable increase in exports and annual GDP. Average per capita income since the mid-1960s. by 2018 increased from $65 to almost $28,000.
• Residents of South Korea are distinguished by high efficiency. It is people and human resources that have become the basis of economic growth in the country. The Koreans worked very intensively, allocating 1-2 days a month for rest. Highly qualified specialists, including engineers and workers, were especially valued. The government made sure to improve the level of education and literacy of workers, their qualifications and skills.
• The fight against corruption was carried out effectively. To do this, the dictator Ban Chung-hee in the early 1960s. dismissed nearly 17,000 officials, and banned 4,000 from engaging in politics and similar activities. As a result, international investors began to invest more actively in the country's economy and financially support it in the post-war recovery. Now any citizen of South Korea can apply to a special service, complaining about bribery and corruption. For this, a person receives a reward, which is calculated as a percentage of the amount of the bribe.
• A change in the tax system that reduced tax rates and improved conditions for investment. Investors saw the attractiveness and potential in the South Korean economy, in its industry and manufacturing.
• Dictator Ban Chung Hee forced the country's wealthy citizens to invest in the country's industry, in its shipbuilding. Such a policy caused disapproval among the supporters of the President of South Korea, but the end justified the means.
• The stable development of the economy largely depended on heredity in the transfer of power, on family control of large firms and enterprises that are formally independent.
• Government support for businessmen who entered international markets.
• A ban was introduced on the withdrawal of capital abroad, all private investments and state resources were directed to exports and industry.

So, in order for the economic development of South Korea to become stable, active and progressive, the government and the people of the country had to go through a break in the traditional system. As a result, now the state economy is in the TOP-20 of the best and most promising economies in the world. South Korea has become a highly developed Asian country that is attractive to investors from all over the world. Experts, analysts, entrepreneurs and businessmen note that it is easy and simple to do business in South Korea, open new jobs and implement various financial projects.

Some reforms, including those on import substitution, turned out to be failed and ill-conceived to the end, corruption and family clans prevented the introduction of new technologies and the transfer of production areas under state control. At this time, the financial assistance provided by the United States proved to be very useful and timely. In particular, 50% of the country's state budget was covered by American creditors, more than 70% of defense spending was paid by the United States. The same applied to the sphere of imports and investments, the level of investments from the States during the reform of the economy reached 70-80%.

Features of the economic and geographical position of South Korea

South Korea is a state in the east of Eurasia. It was formed after the Second World War. The official name of the country is the Republic of South Korea. It is located in the southern part of the Korean Peninsula. The territory of South Korea is washed by the waters of the Japan and Yellow Seas. In the north, the country borders on the Democratic People's Republic of Korea.

Remark 1

The country has an advantageous transport and geographical position. But the North Korean border is a constant source of political and military tension. Currently, the government of the DPRK has announced the creation of its own nuclear weapons. This increases political tension not only in the region, but also in the world.

Natural resource potential of South Korea

South Korea is located at the junction of the Sino-Korean platform and the alpine (Pacific) folding area. The geological structure determined the difficult conditions of the relief. The relief is dominated by mountain structures. They occupy the eastern half of the country. The plains are located in the west of South Korea.

Mineral resources are represented by deposits of such minerals as:

• iron ores;
• polymetallic ores;
• tungsten ores;
• graphite;
• coal;
• gold.

The country lacks its own energy sources. Therefore, it imports oil and gas from other countries. Not enough other minerals.

South Korea is located in the monsoon regions of temperate and subtropical climate. In general, soil and climatic conditions are favorable for the development of agriculture. In the western part, agriculture is developing on irrigated lands.

Features of the economic development of South Korea

At the beginning of the 20th century, Korea was one of the most economically backward countries in the world. During the Second World War, it was occupied by Japan. Therefore, until the very end of the first half of the twentieth century, the level of economic development of South Korea was rather low.

During civil war and the division of Korea into North and South, the traditional economic ties between the industrial North and the agrarian South were severed. The basis for the formation of a new economic complex of the country was the insignificant reserves of its own raw materials, imported raw materials (primarily oil and gas, metals) and agricultural products. Another basic part of the formation of the country's modern economy has become cheap labor.

Therefore, the modern economic complex of South Korea is represented by high-tech labor-intensive machine building and electronics, chemical and oil refining industries, light and food industries. The main focus today is on science-intensive industries. Crop production dominates in the structure of agriculture. The most common crop is rice. The following crops are also grown:

• cotton;
• hemp;
• sugar beets;
• barley;
• wheat.

IN Lately in the structure of the economy of South Korea, the share of the non-manufacturing sector has sharply increased. The number of trade enterprises, banks, and insurance companies has increased. South Korea has become one of the world centers of banking business and exchange activity.

The growth of the South Korean economy

Definition 1

Economic growth is the development of the economic complex of the country, as a result of which there is an increase in real national income, an improvement in the well-being of the population.

The rapid development of the South Korean economy has been observed since the early 60s of the twentieth century. Over a thirty-year period, the volume of the gross national product increased by an average of 8% per year. During this period, the average annual per capita income increased by almost 10 times. The share of industry in the structure of the gross national product increased from 14% to 30.3%. And the volume of trade in consumer goods has grown almost 300 times.

The most tangible changes in economic development associated with the economic policies of President Park Chung-hee. During the implementation of his program, the efforts of the government of the country were aimed at attracting foreign investment, industrializing the country's economy and increasing exports. The role of the state in the economic life of the country has also increased. An element of the administrative system is being introduced into the economy - planned housekeeping. The South Korean government adopted five-year plans for economic development.

Initially, foreign investments were directed to light industry. They took the form of loans to the government and the private sector. The main stake was placed on the export strategy. But this led to a gap between the industrial and agricultural sectors of the national economy. And by the beginning of the 1970s, this phenomenon led to serious economic problems.

If earlier the development of the country's economy was based on cheap labor, which ensured the competitiveness of national products in world markets, then later the government increased funding for the heavy and chemical industries. The transition to the priority of capital-intensive industries was complicated by the global energy crisis of the early 1970s. He limited the possibility of exporting national products. This led to a decline in production in 1980 and an increase in inflation.

In the early 1980s, the South Korean government launched a large-scale economic reform. Tight fiscal measures were introduced and government spending was cut. The budget was frozen and the increase in the money supply was reduced. Thanks to the policy of the central bank, it was possible to reduce inflation. Price liberalization and reduced government intervention in the economy have attracted foreign investors. External debt was reduced.

By the early 1990s, the domestic market had become the basis for economic growth. The increase in the welfare of the population stimulated an increase in demand for many expensive goods. The export direction of the government's economic policy has been replaced by a policy of self-sufficiency. This made it possible to reduce the import dependence of South Korea. The unemployment rate has dropped. Integration processes with the world economy have intensified.