Korea's Economic
Miracle Continues

Poor country becomes 13th largest economy in 6 decades and is still growing


August 15 is the 60th National Liberation Day and there is no doubt that the country has made an amazing economic progress since the country celebrated its liberation from the 36 years of Japanese colonial rule as the statistics show.
The entire country recounts the past six decades of economic progress kicked off by the late President Park Chung-hee, who grabbed power through a military coup in 1961.
When he took power, he was so discouraged by the poor state of the national economy with per capita GDP standing at only $87. He often said he was so envious of the Philippines with per capita GDP of $220.
The late President focused on the development of the national economy since the first day he took power, often at the expense of harsh attacks on his ruthless drive to push to build an industrial base for the country as the country had none of it. During his 18 years of tough rule, he built a solid foundation for economic growth, winning the accolades at home and the world, calling the economic achievement the "Miracle of the Han River."
Per capita GDP, exceeded $20,000 last year growing over 300 times the figure at the time of Korea's liberation from the foreign rule while GDP expanded over 740 times.
Economists around the world, especially Peter Drucker, highly praised the explosive growth of the Korean economy, saying the history of the 20th century cannot be written without including Korea's economic achievement that uplifted the country to rank the 13th in the world in terms of economic scale from a dirt poor country.
Experts attributed the factors that contributed to the huge and rapid economic development to the passion for education that Koreans have, and the late President Park's strong leadership in successfully promoting export-led economic growth and industrial policies that built up the key industries including steel, electronics, machinery, shipbuilding and automobile, and large SOC facilities such as expressways linking Seoul and Busan, the nation's largest harbor.
The late president Park gave up demanding the reimbursement from Japan for its colonial rule of Korea, but instead got $500 million in concessionary loans from Japan and used the fund to build the nation's key industrial and public facilities, including POSCO and the Seoul-Busan Expressway.
He also pushed the development of the heavy and chemical industries from 1973, and built the foundation for the country to attain from 8 to 9 percent in annual economic growth every year until the 1998 foreign exchange crisis.
The private business sector was fully behind the government's huge effort to bring an economic miracle to the country. The late Chung Ju-yung, founder of Hyundai Group, the late Lee Byung-chol, who launched Samsung Group, the late Koo In-hoe, founder of LG Group, and Honorary chairman Park Tae-jun of POSCO are among the first-generation of the business leaders who made a great contribution to the nation to achieve the "Miracle on the Han River."They steered their respective business groups to be at the forefront of the nation's economic development from the early '60s and now those large conglomerates make up some 25 percent of GDP. Samsung Electronics, Hyundai Motor, LG Electronics, Hyundai Heavy Industries and POSCO on the list of the top 10 companies have now grown to be large enough to be recognized around the world.
The nation still needs them to sustain its pace of the economic progress so as to be among the top 10 economic countries in the world. Those companies can help create the 2nd and 3rd Miracle of the Han River if they were given a full support from the government and labor unions. nw

The late President Park Chung-hee together with POSCO executives led by chairman Park Tae-joon, fire up the 2nd blast furnace at POSCO steel complex in Pohang in May,1976.