South Korea

Economic and political outline

Economic indicators | Foreign Trade in figures | Sources of economic information | Political outline

Economic indicators

South Korea has shown spectacular growth over the past 30 years (its per capita income was USD 100 in 1963 which have exceeded USD 18,000 in 2006). South Korea is now the 11th largest economy in the world. However, the growth potential of the economy has fallen due to structural problems, underdeveloped financial markets, rising household debt and aging of the population. A general lack of regulatory transparency is also a key concern for foreign investors. Annual GDP growth reached 4.9% in 2007, higher than the BOK's earlier growth forecast of 4.8%, but a slowdown from 5% in 2006.

GDP Indicators	2004	2005	2006	2007	2008
GDP (billions USD)	681.23	791.57	888.27	949.70e	1,006.13e
GDP (constant prices, annual % change)	4.7	4.2	5.0	4.8e	4.6e
GDP per capita (USD)	14,180.59	16,443.76	18,391.68	19,624.37e	20,748.96e
General government balance (in % of GDP)	2.2	1.9	1.8	2.3e	2.8e
Inflation rate (%)	3.6	2.8	2.2	2.6e	2.7e
Unemployment rate (% of the labor force)	3.7	3.7	3.5	3.3	3.1
Current Account (billions USD)	28.17	14.98	6.09	1.30e	-4.04e
Current Account (in % of GDP)	4.1	1.9	0.7	0.1e	-0.4e

Source: IMF - World Economic Outlook Database

Note: (e) Estimated data

Socio-demographic indicators	2006	2007	2008
Unemployment rate (%)	3.5	3.3	3.1

Source:

Main sectors of industry

The agricultural sector contributes only 3.2% to the country's GDP. Rice is the main agricultural crop. Besides, barley, wheat, corn, soybeans, and grain sorghums are also extensively cultivated. Cattle rearing is also done on a large scale. South Korea's mineral resources are mainly limited to gold and silver. Its main industrial activity sectors are textile, steel industry, automobile manufacturing, shipbuilding and electronics (South Korea is the largest producer of semiconductors in the world). The manufacturing sector contributes nearly 40% to the GDP while as the services sector contributes around 57.2%.

Breakdown of economic activity by sector	Agriculture	Industry	Services
Value added (annual % change)	-2.6	6.5	4.2
Value added (in % of GDP)	3.2	39.6	57.2
Employment by sector (in % of total employment)	7.9	26.8	65.1

Source: World Bank - World Development Indicators - last available data.

Monetary indicators	2002	2003	2004	2005	2006
Average annual exchange rate for 1 USD	1,251.09	1,191.61	1,145.32	1,024.12	954.79

Source: World Bank - World Development Indicators

Foreign trade in figures

South Korea is the 11th largest exporter and the 13th largest importer in the world. South Korea's two-way trade surpassed the USD700 billion marks on Dec. 18, 2007 making it the 11th largest trading nation in the world.

Foreign trade indicators	2002	2003	2004	2005	2006
Imports of goods (millions USD)	148,637	175,337	220,141	256,287	302,631
Exports of goods (millions USD)	163,414	197,289	257,710	288,979	331,845
Imports of services (millions USD)	36,585	40,381	49,928	58,788	70,636
Exports of services (millions USD)	28,388	32,957	41,882	45,129	51,874
Imports of goods and services (annual % change)	15.2	10.1	13.9	7.3	11.3
Exports of goods and services (annual % change)	13.3	15.6	19.6	8.5	12.4
Imports of goods and services (in % of GDP)	33.9	35.6	39.7	39.9	42.1
Exports of goods and services (in % of GDP)	35.3	37.9	44.0	42.3	43.2
Trade Balance (millions USD)	14,777	21,952	37,569	32,692	29,214
Trade Balance (including service) (millions USD)	6,580	14,528	29,523	19,034	10,451
Current Account (millions USD)	5,394	11,950	28,174	14,968	6,093
Current Account (in % of GDP)	1.0	2.0	4.1	1.9	0.7

Source: World Bank - World Development Indicators

Main partner countries

Main customers (% of exports)	2006
China	21.3%
United States	13.3%
Japan	8.2%
Hong Kong	5.8%

Main suppliers (% of imports)	2006
Japan	16.8%
China	15.7%
United States	10.9%
Saudi Arabia	6.6%
United Arab Emirates	4.2%

Source: 2006

Main products

Main exports (% of exports)	2006
Electrical machinery and equipment	26.3%
Vehicles other than railway or tramway	13.1%
Machinery and mechanical appliances	13.0%
Boats and floating structures	6.6%
Mineral fuels, mineral oils	6.4%

Main imports (% of imports)	2006
Mineral fuels, mineral oils	28.0%
Electrical machinery and equipment	17.0%
Machinery and mechanical appliances	10.4%
Iron and steel	5.5%
Photographic, cinematographic, measuring and medical instruments	4.5%

Source: 2006

To see more products: More imports (Intracen Data)
More exports (Intracen Data)

Sources of economic information

Ministries: Ministry of Commerce, Industry and Energy (MOCIE)Ministry of Finance and Economy (MOFE)Ministry of information and Communication (MIC)Ministry of Foreign Affairs and Trade(MOFAT)Ministry of Environment (MOE)Ministry of Construction & Transportation (MOCT)Ministry of Health & Welfare (MOHW)Ministry of Agriculture & Forestry (MAF)
Statistical Office: Korea National Statistical Office
Central Bank: Bank of Korea (BOK)
Stock Exchange: Koea Exchange
Online newspapers: Korea Herald
korea Times
The Chosun Ilbo
JoongAng Daily
Yonhap News
Dong-A Daily
Search Engines: Google
Chol
Yahoo! Korea
Economic portals: Invest Korea
Korea Trade-Investment Promotion Agency (KOTRA)
Korea International Trade Association (KITA)

Political outline

Executive Power: The President is the chief of the state as well as head of the government. He's elected by a popular vote for a single five-year term. President is the commander-in-chief of the armed forces and enjoys executive powers. He appoints the Prime Minister and the State Council (cabinet) with consent of the parliament.
Prime Minister is not required to be a member of parliament and his main role is to assist the President.
Legislative Power: The legislature in South Korea is unicameral. The parliament called National Assembly has 299 seats distributed between parties in proportion to their share of the vote to serve four-year terms.
The executive branch of the government is directly or indirectly dependent on the support of the parliament, often expressed through a vote of confidence.
Main political parties: South Korea has a multi-party system, but parties have little chance of gaining power alone. The major parties in the country are:
- GNP (Grand National Party): a conservative party which won the presidential election in Dec 2007. It is strong in the Gyeongsang region;
- United New Democratic Party (UNDP): a liberal party which is strong in the Jeolla region.
- DLP (Democratic Labor Party): a democratic socialist party with its support base in farmers, industrial workers, and progressive intellectuals;
- MDP (Millennium Democratic Party): a party with its support base in provinces of Jeolla.
Current political leaders: - LEE Myung-bak: President elected on Dec 2007- GNP (Grand National Party);
- PARK Geun-hye: a daughter of former President Park Chung-hee, widely known to be looking to become the GNP's standard-bearer in the next presidential election. She lost the party nomination of GNP to Mr. LEE in 1997's race;
- SOHN Hak-kyu: Leader of United New Democratic Party (UNDP).
Next election dates: Presidential: December 2012
National Assembly: April 2008