Foreign Policy has an interesting article that suggests that Korea's econic development is inexorably leading the country down the Japanese path. Given that the ROK has deliberately used japan as an economic model and it is sitting on the same demographic grenade, that's hardly surprising, though I'm not so sure Japanese-style doldrums and lost decades are an inevitability.
Despite differences in politics and size, China can be seen as representing South Korea's past and Japan its possible future. Like China, Korea prospered by picking the low-hanging fruit of globalization; its growth was driven by the rural-to-urban migration of its population and the successful pursuit of export markets using low-wage labor. And as in Japan's case, Korea's exports started out with a less-than-savory reputation -- such as when Hyundai cars first reached the United States -- but eventually became accepted global brands. But after Japan exhausted the economic engines of urbanization and low-cost exports, it stopped growing -- and now may be slipping into recession again.In some ways, South Korea is already on the same track. There are a number of ominous parallels: Korea's rate of economic growth has been falling since the early 1990s, and its overall trend tracks Japan's with a delay of about 20 years. In terms of urbanization, the lag may be closer to 15 years, but the resemblance is clear. Also, the age profile of Korea's population 15 years from now will likely be very close to Japan's today. You can make similar comparisons between Korea and China, which sits another 15 or 20 years behind.
At least, the Japanese are #3 in GDP.ReplyDelete