Thirty years ago, Korea was poorer than Malaysia and Mexico. Since then, its GDP per capita has surged by a factor of 10 to $17,000, more than double the levels in those countries. GDP growth (...) is estimated to be 6% this year. Yet when I left Korea in 2000, it was an open question whether its success could continue. The embarrassing memories of the 1997 Asian financial crisis were still fresh, and Koreans were worrying that they would lose out to a rising China.
Over the past decade, however, Korea has reinvented itself — it's an Asian miracle again. Korea has become an innovator, an economy that doesn't just make stuff, but designs and develops products, infuses them with the latest technology, and then brands and markets them worldwide, with style and smarts. Samsung and LG, not the Japanese electronics giants, are dominating the hot new LCD-TV business. In 4G phone technology, Samsung is poised to become a leading force, while Hyundai Motor, an industry joke a decade ago, is a top-five automaker, its rising market share fueled by quality cars and nifty marketing. "'Made in Korea' used to be synonymous with cheap and imitative," says Bernie Cho, president of DFSB Kollective, a start-up that markets Korean pop music internationally. "Now it's become premium and innovative." New industries, from online games to pop music, have emerged as powerhouses.
Politically as well, Korea is stepping out of Washington's shadow and becoming an influential voice in its own right. Symbolic of that new role, Seoul is hosting the G-20 summit on Nov. 11 and 12, the first Asian country to do so. This nation is a global leader-in-waiting.
Part of Korea's success is simple commitment. Koreans spend some 3.5% of their GDP on R&D, compared with 1.5% in China and less than 1% India. (...). Koreans have become more accepting of diversity and outside influences and quicker to shed old prejudices. Such an outlook was brought about by a fundamental (and continuing) reformation of Korean society. Koreans are breaking down the barriers that held the nation back, a process fostered by political freedom and a passionate embrace of the forces of globalization.
|Letters of Korean Alphabet, |
neither Chinese nor Japanese
After (the 1997) crisis, Koreans had to rethink the ways they did business, managed their careers — even their entire economic system. The crisis "was the catalyst" for change, says financier Tom Kang. "The old ways didn't work."
The number of foreigners living in Korea has exploded, from fewer than 250,000 in 2000 to more than 870,000 in 2009. Business before the financial crisis "was more like a club," Kang says. Now "there's a lot more competition, and that's forcing people to be innovative. If they don't, they're going to die."
In the early 90's, smart, young Koreans had a very narrow path to success: Not anymore. Koreans have become much more accepting of different life choices. That's encouraged an army of young people to start their own companies, often in innovative IT or high-tech businesses.
All said doesn't mean the Korean system is perfect. Despite its progress, Korean society still remains too wary of foreign influence and too biased against women in the workforce. Businessmen complain that too much red tape clogs their way. The outdated education system is so rigid that parents flee the country in droves to put their kids into high schools in the U.S. and elsewhere.
However, the Korea I know is a country that confronts its challenges. I asked my old friend at LG, Sue Kim, what Korea will be like in another 10 years. With more and more Koreans gaining international experience, she believes the great globalization of Korea will continue. South Korea has 75,000 students enrolled at U.S. universities — third highest, behind giants India and China, according to the Institute of International Education. "I think you'll find a much more cosmopolitan Korea," she says. "I think Koreans will bring in more diverse ideas and backgrounds. We're going to extend our presence more globally. We're going to continually grow, and you're going to see a much better country in 10 years." I don't doubt it.
— with reporting by Lina Yoon / Seoul
To learn about Korea, visit www.korea.net