S.Korea Becomes Export Powerhouse as N.Korea Starves

  • By Jo Jae-hee

    July 25, 2023 13:20

    The difference in wealth and development between South and North Korea grows more dramatic every year now that 70 years have passed since the armistice halted the Korean War.
    Last year South Korea's trade volume stood at US$1.41 trillion compared to a measly $1.59 billion for North Korea or a staggering 890 times bigger.
    The South was the world's sixth-largest exporter last year by shipping out semiconductors, petrochemical products and cars, while North Korea struggled with a paltry trade in silk, wigs, artificial flowers and minerals.
    According to Statistics Korea on Monday, South Korea's nominal gross national income stood at W40.48 million in 2021, 28.5 times larger than North Korea's W1.42 million  (US$1=W1,280). Seventy years ago the South actually lagged behind the North, but that trend was reversed from the late 1960s to mid-1970s as the "miracle on the Han River" transformed the South's economy.
    "North Korea's economy improved temporarily in the 1950s and 1960s thanks to aid from the Soviet Union and China, but dynastic communism resulted in accumulated difficulties over the long term," says Kim Byung-yeon at Seoul National University.
    North Korean factory workers make wigs in this video grab from Douyin.
    In South Korea there are now 24.91 million cars on the roads, or about one for every two inhabitants, but North Korea has only 253,000. South Koreans have 70.5 million mobile phones, 11 times more than North Korea's.
    The 576.8 billion kWh of electricity South Korea generates every year is over 20 times more than North Korea's. Until the 1980s there was very little difference in annual output, but since then South Korea's electricity production surged 1,450 percent and the North's rose only 20 percent, mostly from dirty coal.
    North Korea's economy still remains at the level of the late 1960s and 70s as its key exports of mineral and fisheries have been hit hard by economic sanctions since the mid-2010s.
    The South Korean economic miracle was due to strongman Park Chung-hee's drastic economic plans financed by Japanese reparations.
    Kim Bum-soo at the Institute for Peace and Unification Studies at Seoul National University said, "During the Cold War, we had easy access to the U.S. market, which is the biggest market in the world, and in the 2000s we took advantage of China's explosive growth. But North Korea was unable to benefit from the Soviet Union, and when communist governments around the world collapsed in the late 1980s, it went deeper into isolation."
    But all this is nothing to gloat about since the vast economic difference will pose a huge burden for the South if the two Koreas are reunified. Nothing on this scale has been seen before.
    "When East and West Germany reunified, the West ranked fourth in the world in terms of economic power and the East 35th, and even then it was an enormous effort," said Nam Sung-wook at Korea University. "Think what the cost burden will be if South Korea, which is the world's 13th largest economy, reunifies with North Korea, which ranks right at the bottom."
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