More About South Korea

The focus of today's Post is once again The Republic Of Korea, i.e. South Korea.

The brief but significant excerpts shown below are from The World Bank's website: http://web.worldbank.org/WBSITE/EXTERNAL/COUNTRIES/

The Republic of Korea has experienced remarkable success in combining rapid economic growth with significant reductions in poverty, despite the country's history of civil war and its dearth of available natural resources.

The Korean economy recovered rapidly from the 1997 financial crisis that hit Southeast Asia, as the government implemented reforms to quickly address economic vulnerabilities.

As a "newly industrialized economy," Korea is working to share development experience learned from its transformation to a "knowledge economy." These lessons include embracing good economic policies, adopting a high-growth development agenda, enhancing the labor force and increasing social capital through increased education, and addressing agricultural development and rural equity.

And now, to provide a more comprehensive view of the South Korean economy, here is a recent South Korea "Country Brief" (April 2007) from the World Bank website referenced above:

• The Korean economy expanded by 5 percent in 2006.
• Growth was supported mainly by stronger private consumption (4.2 percent), growth in facility investment (7.5 percent) and strong exports (13.0 percent).
• In the past few months, however, the economy has slowed, easing to 4.0 percent growth in the final quarter from 4.8 percent and 5.3 percent in the third and second quarter, respectively, principally due to weaker domestic demand.
• Private consumption moderated in the final quarter from recovery at a faster pace than household income since 2005.
• Slow growth in employment and income is likely to restrain private consumption growth in the near future. Fixed investment growth remained sluggish in 2006 with negative growth in construction investment, partly affected by government measures to curb speculation in real estate, although construction investment did begin to pick up slightly in the fourth quarter.
• Exports continued robust growth averaging 16 percent in the first two months of 2007, but is expected to slow with a slowing overall export environment.

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South Korea. A Fascinating Country!

Today we will take an indepth look at the South Korean economy, and will treat you to some excerpts from the website: www.workpermit.com:

Hundreds of thousands of South Koreans have emigrated to places around the world since the Korean War ended in the 1950's. Traditionally a closed society, very similar in some aspects to Japan, not very many foreigners immigrate back into the country.

Combined with a fairly static birth rate, the country has shown signs of
not replacing its highly skilled and educated work force at needed rates for some time.

Research Institute now indicates that increasing numbers of highly skilled Koreans are leaving the country. One of the conclusions of the report is that the Republic of Korea's international competitiveness is being shaken, with many of the best Korean workers leaving the country and not enough replacements arriving.

So, it seems that South Korea is losing some of its vitally needed skills, and that this problem cannot be ignored or brushed aside!

We will therefore continue our indepth look at South Korea in our next few Posts.

Meantime, please feel free to share any comments on the "brain drain issue" by posting your Comments on this blogsite. Thanks!

The Tiger Economies

In the next few Posts, we will take a closer look at the so-called "tiger" economies, and at the impact of the "brain drain" on these economies.

You will recall that South Korea, Singapore, Hong Kong, Taiwan and Ireland were amongst the first to be dubbed "tiger" economies! Their economic growth rates were regarded as very rapid, and they came to be seen as role models which other developing economies should emulate.

A decade or so later, other rapidly growing economies such as the Baltic States, Estonia, Latvia, and Lithuania, also came to be generally regarded as "tiger" economies.

It will be highly interesting (and fun) to see how these tigers coped with the challenges of the brain drain. Were their skills attracted to North America and to the European Union countries, and what specific steps did their Governments take in order to slow down or to reverse the brain drain?

Should you have any thoughts and/or suggestions that will help us better understand these matters, we warmly invite you to leave a "comment" or a "post" on this blog-site. And, please visit us again soon to read the results of our research!

Thanks very much.

Is the "Brain Drain" already in "Reverse"?

Now hear this! The "Times of India" newspaper says that the Brain Drain is already in "reverse", courtesy of the US Immigration & Naturalization Service!

WASHINGTON: More than one million skilled immigrant workers, including
engineers, doctors and researchers compete for 120,000 permanent US resident
visas each year and this imbalance may fuel a reverse brain-drain from America
affecting the country, a new study has said.

The situation is even bleaker as the number of employment visas issued to
immigrants from any single country is less than 10,000 per year with a wait time
of several years, the report by the Ewing Marion Kauffman Foundation said. "The
United States benefits from having foreign-born innovators create their ideas in
this country," said Vivek Wadhwa, Wertheim fellow with the Harvard Law School
and executive in residence at Duke University.

"Their departures would be detrimental to US economic well-being," he said.
The earlier studies documented that one in four engineering and technology
companies founded between 1995 and 2005 had an immigrant founder.

Indian immigrants founded more companies than the next four groups from the
United Kingdom, China, Taiwan and Japan combined.

Researchers found that these companies employed 450,000 workers and
generated USD 52 billion in revenue in 2006.

The key finding from this research is that the number of skilled workers
waiting for visas is significantly larger than the number that can be admitted
to the US.

This imbalance creates the potential for a sizable reverse brain-drain from
the United States to the skilled workers' home countries, the Foundation said.

REMITTANCES TO LATIN AMERICA & THE CARIBBEAN

In its March 2007 report, the Inter-American Development Bank (IADB) describes Latin America & The Caribbean(LAC) as "the largest remittances market."

Here are some other interesting excerpts from that report:

• The remittance market has changed dramatically over the past few years.
• Once "hidden in plain view," remittances are now widely recognized as
  critical to the survival of millions of individual families, and the health of
  many national economies throughout Latin America and the Caribbean (LAC).
• Unlike foreign aid, migrant remittances go directly to families in places
  that are often difficult to reach with official development assistance.
• While international capital flows have fluctuated with market cycles,
  remittances have steadily increased, even during economic recession.
• For 2006, remittances to LAC reached US$62.3 billion (14% over 2005), making the region the largest remittance market in the world.
• This amount exceeded, for the fourth consecutive year, the combined flows of
  all net Foreign Direct Investment (FDI) and Official Development Assistance
  (ODA) to the region. Given the complicated process of tracking informal
  flows, particularly those still carried by hand, actual flows could be at least
  10% higher.
• Mexico remains the largest recipient of remittances, at over US$23 billion,
  followed by Brazil and Colombia which reached over US$7 and US$4 billion
  respectively. Central America and the Dominican Republic combined to reach over US$13 billion; the An-dean countries totaled almost US$11 billion; and the Caribbean, $4.5 billion.
• It is currently estimated that over 20 million LAC-born adults send money
  home on a regular basis -- typically $200-$300 a month - resulting in more than 250 million separate financial transactions a year.

These figures are revealing indeed, and raises the question whether the diaspora as a whole fully appreciates how important its role can be, in promoting the social and economic development of the so-called 'third world,' and in banishing poverty worldwide!

What are your thoughts on this tantalizing issue? Please share them with us by placing a Post or Comment on this blog.

Thank you.