The annexation of Korea to its territory, perpetrated by Japan in 1910, had a decisive influence on the evolution of the country’s economy, affecting the development of communication routes and industrial and extractive activities, especially for the northern regions. According to businesscarriers, South Korea, more favored in terms of climatic and environmental conditions, remained eminently agricultural, even assuming the role of a real granary for Japan. The separation of the two countries in 1953 then marked the antithesis of the economic and social policies pursued in the following decades by the respective governments. If the division of the peninsula made the economic development of both states difficult, however at the beginning it was certainly South Korea that suffered the most severe repercussions of the second post-war period. given the pre-existing situation of fragility in which the country found itself, due to the pre-eminent dependence on Japan. Despite the substantial aid from the United States and, until 1961, from the UNKRA (United Nations Agency for the Reconstruction of Korea), it was only in the 1960s that the country was able to recover its pre-war production values. To accelerate the process of economic development, it soon became clear that South Korea had to face the problem of its own industrialization, without neglecting the food needs of an already very large and rapidly growing population. In the decade following the civil war and the separation of the two states, the South Korean government promoted some measures to revive the country, supported by US cash flows and UN aid: in addition to a strong schooling campaign, he launched an agrarian reform for the redistribution of income and introduced rigid tariff barriers. But it was 1962, the year of the first five-year plan, that marked a watershed with the past. The program of the plan, like those that followed it, aimed above all to strengthen industrial production, both basic and – and increasingly – manufacturing of consumer goods, for the internal market and for export. This process was accentuated over the years thanks above all to enormous foreign investments, mainly Japanese and American again, attracted by the very low costs of highly exploited labor and by a government policy favorable to foreign capital.
The leading sectors of economy were those of textile, chemical, steel, toys and electrical appliances. It was thanks to the spectacular increases recorded by these sectors – for some productions we can now speak of “European levels” – that the national product grew, in the 1970s, despite the global economic crisis, at an annual average of 9%. In this period, the country also benefited from a conspicuous improvement in infrastructure and a series of measures implemented by the government to rebalance the dissimilar development of the various regions. In these years the – if the national product grew, in the seventies, despite the world economic crisis, at an annual average of 9%. In this period, the country also benefited from a conspicuous improvement in infrastructure and a series of measures implemented by the government to rebalance the dissimilar development of the various regions. In these years the – if the national product grew, in the seventies, despite the world economic crisis, at an annual average of 9%. In this period, the country also benefited from a conspicuous improvement in infrastructure and a series of measures implemented by the government to rebalance the dissimilar development of the various regions. In these years the chaebol, large industrial groups in the hands of a few families and with diversified activities (on the Japanese model), supported and facilitated by government policies. To further increase investments since the 1980s, which began with a strong recession that the State had to face with drastic measures to restore the economy (reduction of public spending, liberalization, progressive reduction of public interventions in the economy), the ‘entry of foreign operators, whose capital began to orient itself predominantly towards high technology (a sector that in that decade saw an exponential growth), and they also began to intervene in the financial and banking fields with structural reforms. The trend positive trend of the South Korean economy continued also in the last decade of the twentieth century, although the growth indices showed a physiological slowdown, essentially caused by the maturity of the Korean economy, two new recession crises and greater protectionist measures implemented by Western trading partners. Thanks to the reforms launched by the government in 1997-98, as well as the agreement with the International Monetary Fund, South Korea has also taken significant steps towards greater transparency and flexibility of the economic system. The country has opened up even more to foreign investment, financial markets have been modernized and a stock exchange commission has been set up. These factors have allowed the South Korean economy to resist well the Asian monetary crisis of 1997, which, resulting from excessive indebtedness with foreign countries, brought out the serious structural problem of the South Korean economy: that is, the low productivity of capital and labor. The harsh conditions imposed by the IMF to intervene with a bailout plan, including the repeal of the ban on layoffs, have led to an increase in the interest rate by banks, an explosion in the rate of inflation and an increase in the unemployment rate; however, the solidity of the economy recorded, in the following years, a constant and conspicuous growth of the GDP which, with an increase of 5%, places the country in eleventh place in the world ranking (2006). In 2018, GDP stood at US $ 1,619,424 million. South Korea’s trade balance is widely active and, in the two-year period 2006-2007, both inflation and the unemployment rate stood at very low values (3.3%). In the following decade, the unemployment rate rose by 0.5, reaching 3.8% in 2018. L’ industrial activity, clearly of a private nature and largely controlled by foreign multinationals, especially Japanese, recorded growth values absolutely unknown to Western economies; agriculture, on the other hand, has consequently suffered a strong penalty.
