lecture iii south korean economy todayswan.ewha.ac.kr/lecture3_south korean economy_current...

Lecture IIISouth Korean Economy today

Lecture 3: South Korean Economy - Current Status and Issues in the future

South Korean Economy: Current Status 1

Korean Economy with Numbers

• GDP (PPP based)

S. Korea $ 2.03 Trillion (2017 est)

N. Korea $ 40 Billion (2015 est)

Germany $ 4.15 Trillion (2017 est)

Taiwan $ 1.185 Trillion (2017 est)

Hong Kong $ 454.9 Billion (2017 est)

UK $ 2.88 Trillion (2017 est)

Japan $ 5.41 Trillion (2017 est)

China $ 23.12 Trillion (2017 est)

U.S. $ 19.36 Trillion (2017 est)

India $ 9.45 Trillion (2017 est)


• GDP/person

S. Korea $ 39,400 (2017 est)

N. Korea $ 1,700 (2015 est)

Germany $ 50,200 (2017 est)

Taiwan $ 50,300 (2017 est)

Hong Kong $ 61,400 (2017 est)

UK $ 43,600 (2017 est)

Japan $ 42,700 (2017 est)

China $ 16,600 (2017 est)

U.S. $ 59,500 (2017 est)

India $ 7,200 (2017 est)

U.K.’s average family and Possessions

Income/person:

$42,500

Life Expectancy:

81

Iliteracy:

1%

Income/person:

$18,900

Life Expectancy:

76

Illiteracy:

8%

Mexico’s average family and Possessions

Income/person:

$2,300

Life Expectancy:

50

Iliteracy:

56%

Mali’s average family and Possessions


• GDP Growth Rate

S. Korea 3.0% (2017 est) ← 2.7% (2016)

N. Korea -1.1% (2015 est) ← 1% (2014)

Germany 2.1% (2017 est) ← 1.7% (2016)

Taiwan 2.8% (2017 est) ← 1.4% (2016)

Hong Kong 3.8% (2017 est) ← 2.1% (2016)

UK 1.7% (2017 est) ← 1.8% (2016)

Japan 1.5% (2017 est) ← 0.5% (2016)

China 6.8% (2017 est) ← 6.6% (2016)

U.S. 2.2% (2017 est) ← 1.6% (2016)

India 6.7% (2017 est) ← 7.6% (2016)


• Unemployment Rate

S. Korea 3.8% (2017)

N. Korea N.A.

Taiwan 3.8% (2017)

Germany 3.8% (2017)

Hong Kong 3.1% (2017)

UK 4.4% (2017)

Japan 2.9% (2017)

China 4.0% (2017)

U.S. 4.4% (2017)

India 8.8% (2017)


• Inflation Rate

S. Korea 1.9% (2017 est)

N. Korea N.A.

Germany 1.6% (2017 est)

Taiwan 0.6% (2017 est)

Hong Kong 1.5% (2017 est)

UK 2.6% (2017 est)

Japan 0.4% (2017 est)

China 1.8% (2017 est)

U.S. 2.1% (2017 est)

India 3.8% (2017 est)

Korean Economy with More Numbers

• GDP by Industrial Sector

2.4%

38.7%

58.9%

Agriculture and Fisheries

Manufacturing

Service


• Labor Force by Industrial Sector

6.90%

23.60%

69.50%

Agriculture and Fisheries

Manufacturing

Service


South Korean Economy: Current Status 2


• Income Distribution (2016)

6.40%

37.70%

Lowest 10%

Highest 10%


• Gini Index

S. Korea 34.1 (2015)

N. Korea N.A.

Germany 27 (2008)

Taiwan 33.6 (2014)

Hong Kong 53.9 (2016)

U.K. 32.4 (2012)

Japan 38 (2011)

China 47.4 (2016)

U.S. 45 (2007)

Philippines and Argentina

The Polarization of Income Distribution (Spoon Theory)

Gold Spoon Silver Spoon Bronze Spoon Soil Spoon

The Polarization of Income Distribution


• Export: $ 552 Billion (2017)

- China (26%), U.S. (13.3%), HK (5.8%), Vietnam (5.3%),

Japan (4.9%)

• Import: $ 448 Billion (2017)

- China (20.7%), Japan (10.5%), US (10.1%), Germany (4.8%),

Saudi Arabia (4.5%)


• Foreign Reserve:

- $ 402 Billion (end of 2017)

• Exchange Rate:

- 1139 Won/$ (as of October 2018)

- 1088 Won/$ (end of 2017)

- 1208 Won/$ (end of 2016)

- 1084 Won/$ (end of 2015)

The Shape of Korean Economy with Numbers

• Foreign reserves

Souce: HaverAnalytics*Estonia, Slovenia, China, Taiwan, Vietnam,

Saudi Arabia and Israel excluding gold

including gold*, $bn, latest

Aregentina 45.3Oct China 3,305.3Sep

Brazil 377.8Oct Hong Kong 302.4Oct

Chile 38.9Oct India 295.3Oct

Colombia 36.4Oct Indonesia 110.3Oct

Mexico 162.4Oct Malaysia 138.3Oct

Peru 62Oct Pakistan 15.2Jun

Venezuela 25.9Oct Philippines 82.1Oct

Czech Republic 44.1Oct Singapore 254.2Oct

Estonia 0.3Sep South Korea 323.5Oct

Hungary 45.5Oct Taiwan 398Q3

Latvia 6.9Oct Thailand 181.4Oct

Lithuania 8.3Oct Vietnam 20.4Jul

Poland 105.9Oct Egypt 15.5Oct

Russia 526.8Oct Israel 75.9Oct

Slovakia nilSep Saudi Arabia 621.5Sep

Slovenia 0.9Oct South Africa 50.7Oct

Turkey 117.7Jul

Ukraine 26.8Oct


Current Economic Problems in Korea

Current Economic Problems in Korea

• Still Slow global (Chinese) Economy

• Young workers’ low employment

• N. Korea’s threat with atomic bomb and THAAD

• Government, Households, and Corporations’ Debt

• US‘ new government

• Structural reforms

The Best Economy in the World

LuxembourgBest per person income2012 reading: $106,958


MadagascarLowest government debt2012 reading: 5%


United StatesLargest economy2012 reading: $15.6 Trillion


LibyaFastest economic growth2012 reading: 76%


MongoliaLargest Investment 64% of GDP


Issues in the future of Korean economy

Issues in the future of Korean economy

• Aging Economy

• Female workers’ more participation in labor mkt

Aging Economy

• Reasons?

- Low Fertility Rate (4.5 → 0.9)

- Increase in Avg Life Expectancy (63 → 76)

• Entering the Aging Economy in 10 years

- Unprecedented in other countries

- U.S. 71 yrs, France 115 yrs, Sweden 85 yrs, Japan 24 yrs

The Fastest Progress to Aged Economy

Source:Statistics Korea

1960 2050

Male MaleFemale Female

Aging Economy

• Results?

- decreasing labor force

- decreasing savings

- low economic growth

- government budget worsens

- pension worsens

Female Workers

• Without Increasing Female Workers Labor Force Participation,

there will not be Economic Growth?

• If S. Korea want to be a member of the riches countries, the

female labor force participation rate should be doubled!

Korean Female Workers’ Labor Force Participation Rate by Edu Level (%)

year totalBelowEle S

Below Mid S

BelowHigh S

BelowCollege

Above College

2006 48.8 44.8 42.3 49.7 60.9 58.3

2007 49.3 43.7 43.0 50.7 61.5 58.5

2008 49.8 43.0 43.4 51.5 62.1 59.2

2009 49.0 40.1 40.9 51.5 61.7 58.3

2010 49.9 39.5 41.1 53.1 62.7 60.1

2011 50.1 38.9 40.9 63.4 63.1 60.3

Korea’s place in OECE countries in terms of women’s labor activities

Segment Rate Korea’s ranking

Female unemployment rate

2.8 28th

Female employment-to-population ratio

53.2 24th

Percentage of femalesworking or seeking work

54.7 28th

Percentage of femalesamong part-time workers

59.0 30th

Wage gap betweenmale and female workers

38.0 1st

Source: Organization for Economic Cooperation and Development

Other Issues in the future of Korean economy

• Integration of Far-East Asian Countries: China, Japan, Taiwan, and Korea

• Disappearing Industries: Which one?

• Old population: Very fast!

• Reunification of South and North Korea: Economic Effect

• China’s Influence: Continues


The End

lecture iii south korean economy todayswan.ewha.ac.kr/lecture3_south korean economy_current...

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