Poh Kian YongSoh Hwa JieFion Wong

• Population: ~50 million• Ethnically homogenous• Christianity (31.6%) ,

Buddhism (24.2%)• Confuscianism

Geography&Demography

• 8 distinct provinces• Seoul and South Gyoengsong

the most developed• Mountainous, shortage of land• Among Russia, Japan and China

EconomyElectronics

Automotive

Ship-Building

•TV, aircons, phones and hi-tech display•Mobile telecommunications taking the lead •Global leading manufacturer of LCD and plasma display•LG and Samsung

•Started exporting in 1976, rapidly expanding thereafter• Trendsetting policies, vanguard of major movements•Durability, diversity, technology, safety and economical•Hyundai Kia, GM Daewoo and Renault Samsung Motor

•7 of the world top 10 shipbuilders AND shipyards•High value-added cruise ships and special oil prospecting ships•Hyundai, Samsung and Daewoo Heavy Industries

• GDP: US$ 1.1296 trillion • Annual GDP Growth: 3.9%• Inflation Rate: 1% • Trade Surplus: US$ 926 million

MajorExports

25%

14%

10%9%

42% China

ASEAN

US

EU

Others

10%

Petrochemicals

9%

Semiconductors

9%

Machinery

9%

Automobiles

7%

Ships

7%

Steel

5%

LCD Devices

Export Partners

6th Largest Exporter

ComparativeAdvantages

R&D

• Invests heavily relative to their income

• Growth in investment faster than GDP growth rate

• Technological forefront and keeping up with changes

• Value-for money

Educated Workforce

• Large emphasis on education• Science, technological &

business• 63% of 25-34 year-olds

complete tertiary education• Industrial flexibility • Low-cost, high quality

products

Financial Institution

• 10 banks in the top 50 safest emerging market banks

• 3 banks in the world’s 50 safest banks

• Credible banking industries• Safe and reliable conduit of

business transactions

PoliticalDevelopment

1945-1948

1948-1960

1960-1961

1961-1963

1963-1972

1972-1979

1979-1987

1987-presentday

First Republic Syngman Rhee

Second Republic Yun Bo-seon

Military rule MG Park Chung-hee

Third Republic Park Chung-hee

Fourth Republic Park Chung-hee

Fifth Republic Chun Doo-hwan

Sixth Republic Roh Tae-woo

Kim Young-sam Kim Dae-jung Roh Moo-huyn Lee Myung-bak Park Geun-hye

Military rule Liberal Conservative

US military Administration

Lt. Gen John R. Hodge

Politics&Business

• Increased deregulation and decreased government intervention

• Increased transparency• Liberalization of foreign

exchange rate, FDI and insurance

• Privatized most publicly owned• bank• Raised interest rates• Abolished cap of aggregate FDI• “Big Deals” approach• Legalized lay-offs

• Increased cooperation with Chaebols to reinforce autonomy

• Protected domestic industries Control of financial sector and government-business ties• Adopted tight fiscal policy

• Increased efforts to distribute resources to SME

• Reduced protectionism and improved business environment

IMPLICATIONSGrowth in Chaebol companiesGrowth in domestic companies

and shift to export-orientedPark Chun Hee

Chun Doo-hwan

IMPLICATIONSIncreased competitiveness

Growth in SMEClamp down on Chaebol

companies

Kim Young Sam

IMPLICATIONS

Rise in unemployment ratesStronger Chaebol companies

Further increase in foreign capital inflow

Kim Dae-jung

IMPLICATIONS

Increase in foreign capital flowRise in banks and financial

companies to handle foreign capital

RecentDevelopment

2.87Veto point

Credible commitment vs

decisiveness

Deregulation: Negotiate new bilateral and multilateral FTAReview economic regulations

Reduce reliance on Chaebol exports:Increased funding for start ups Foster Venture Capitalists

Opens up Korean market to foreign firmsNurture service sector

Increase number of exporting firms (SME)

19th Assembly of South Korea

Culture&Business Etiquette

‘Ppalli Ppalli’ culture• ‘Hurry, hurry’• Time efficiency

Collectivism• Harmony• Protests• Strikes

Kibun• Pride, Face, Mood• Politeness,

Consideration

Nunchi• “Eye measure”• Ability to read kibun• Non-verbal cues

Hoesik• Company dinners• Hierarchical bonding• “Rounds”

Drinking• Posture• Never pour for yourself• Always fill empty cups

Society

• Influence of celebrities• Flourishing advertising industry

The Celebrity Effect• Entertainment Industry• 2/3 of advertisements use

celebrities

IMPLICATIONS

• Importance of connections and

relationships• Transparency issues

Nepotism• 56% of workers hired

through personal connections

• FM Nepotism Scandal

IMPLICATIONS

• Need for internet presence• Communicating with consumers• Telecommunication infrastructure

Connectivity & Internet• Naver, ‘Cafe’s• KakaoTalk, Naver Line• 5G by 2020

IMPLICATIONS