May 16, 2016 09:56
The costs of Korea's reunification would run to US$1 trillion by conservative estimates, the Economist claimed on Saturday.
In an article titled "What North and South Korea would gain if they were reunified," the British weekly described the cost as "staggering," or three-quarters of annual GDP. South Korea's GDP was $1.4 trillion in 2015.
South Korea would need a social security system to provide for 25 million North Koreans, "many of them brutalized and malnourished, and including tens of thousands of prisoners in the North's gulag."
But the gains would also be significant as North Koreans see their living standards improve while South Korea would be able to recover economic vitality from an abundant young labor force and underground resources from the North.
"Disbanding the North's standing army, the fourth-largest in the world, would free up workers. In total, about 17 million workers would join the South's 36 million -- though admittedly with far lower skills and education," at a time when "South Korea's working-age population begins to shrink from 2017," the weekly wrote.
"South Korea would also reap a windfall in reserves of rare earths, which are used in electronics," it added.
The underground resources in the North are estimated to be worth about $10 trillion, 20 times as much as those of South Korea.
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