South Korean Export Oriented Regime Context and Characteristics
THE PERFORMANCE of the South Korean economy in the last two decades has attracted considerable attention in the debates on the patterns, prospects and limitations of capitalist industrialization in the Third World. Several sets of meretricious statistics have been furnished and claims advanced regarding South Korea's experience of export-led strategy which call for a closer secutiny and rigorous analysis. Some of the more significant claims are : (a) South Korea has been able to successfully develop capitalism and thereby salvage capitalism in the Third World; (b) its economy has registered an annual rate of growth ofGNP of about ten per cent since 1962 and a striking rate of growth of exports from $ 52 million in 1962 to $ 2.4.22 billion in 1983; (c) its experience has established the veracity of both the export-led growth and growth with equity models of economic development; (d) its economy has seen a movement from aid sustained growth to trade sustained growth. Exports contributed 40.2 per cent of its GNP in 1983; (e) its export profile mirrors its diversified economic structure because manufactured goods accounted for 94.4 per cent in 1983 of all exports, roughly a sixth of the manufactured goods exported by developing countries, and its exports of heavy and chemical industrial products accounted for 54.89 per cent in 1983;
(f) over the years (since 1972) it has been able to reduce its reliance on foreign capital. The total external debt outstanding at the end of the 1986, the final year of the Fifth Five Year Plan is projected to reach $47.4 billion against the $ 64.5 billion projected three years ago. Debt service payments although increasing as percentage of GNP are decreasing as percentage of exports. Its debt service ratios dropped from 15.9 per cent in 1982 to 15.4 per cent in 1983 as a percentage of exports. It is considered as a good financial risk today when compared with some other Third World countries; (g) while the State has encouraged foreign capital it has been able to direct foreign capital and maintain control over its economy; (h) it accounts for ten MNCs of the top 500 non-US MNCs in such industries as ship-building, transportation, petroleum, electronics, appliances, industrial equipment, textiles, metal products and chemicals; and (i) its real per capita incomes have more than tripled since the early 1960s and its distribution of income is mpre equal than
'* Centre for East Asian Studies, School of International Studies ,Jawaharial Nehru University. New Delhi.