Hard Going in the 13th Largest Economy

Last year Korea was the 13th largest economy in the world, but needed to improve on the quality of life and investment environment.

According to the “Korea Through 208 Economic, Trade, and Social Indexes”, the Korea International Trade Association (KITA) announced on October 29 based on recent statistics from international organizations and other private institutions, in 2006, Korea’s GDP was $887.4 billion, and the scale of trade was $634.9 billion, the world’s 13th and 12th place, respectively.

Shipping orders and shipbuilding all ranked first while crude steel, chemical fiber, and automobile production ranked fifth. The export amount for styrene ranked first as well, and semiconductor transistor, computer, artificial textile, and synthetic textile export was second.

There were 59 domestic companies that took first place for products in the world market in 2005, ranking Korea 17th.

Meanwhile, in terms of international competitiveness measured by the Swiss International Institute for Management Development Korea was 29th place, according to the UN Human Development Index and Gender-related Development Index, Korea was 26th, and for transparency index measured by Transparency International Korea ranked 34th, for economic freedom measured by Cato Institute, 32nd.

For quality of life, Korea ranked 38th behind Taiwan (33rd) yet higher than China (45th). Korea was second after Chile for the highest private education fees, comprising 2.9 percent of GDP.

The cost of living in Seoul was the third highest in the world after Moscow and London, with apartment rent the third highest after Britain and Hong Kong. Rent for offices was the eighth most expensive.

Trend analyst Hong Seung-beom at KITA says, “Our main industrial and economic trade indexes are generally top-notch, but the investment environment still doesn’t cut it. We need stable union relationships, and we need to loosen up dramatically on regulations.”

parky@donga.com