Korea's uncertain path ahead

In a recent press conference following his re-election as Chairman, Chey Tae-won of the Korea Chamber of Commerce and Industry (KCCI) raised a crucial question: Is Korea sustainable with business as usual? Urging collective reflection, Chey called upon the National Assembly, government, political sphere, and civil society to collaboratively tackle pressing issues like sluggish economic growth and declining fertility rates.

His question warrants serious consideration. A recent report from the Korean Peninsula Population Institute for Future paints a stark picture: Korea is hurtling towards a demographic crisis. Within seven years, half of its population will be 50 or older, while in nine years, elementary school enrollment will halve. In 14 years, military recruits, crucial for national defense, will dwindle to less than 200,000. And by 20 years, the productive population will shrink by approximately 10 million.

Despite its status as an advanced economy, Korea is ensnared in a cycle of stagnant growth, barely surpassing the 1% mark. Alarmingly, its growth rate trails even that of the U.S., where per capita income is more than double. The stagnation is underscored by the unchanged roster of Korea's top 10 export products since 2000, revealing a failure to diversify, innovate, and find a new growth engine. Once a boon, the "China Effect" has waned, leaving Korea overly reliant on semiconductor exports, akin to hopping perilously on one leg.

Once admired, Korea now attracts concerned scrutiny. U.K. media outlet Financial Times, in its feature "Is South Korea's economic miracle over?" contends that Korea's state-driven growth model has hit its ceiling. The term "peak Korea" has also emerged, suggesting an inevitable decline. Alarmingly, Korean society appears indifferent to the looming crisis. Despite warnings 18 years ago of impending population decline, the birth rate, instead of rising, continues to plummet, signaling a perilous trend.

Korean society must fully tackle the challenges of low fertility and stagnant growth to avert doomed catastrophes. Addressing the root causes demands a comprehensive overhaul of economic and social structures discouraging childbirth. Structural reforms and deregulation are imperative to revitalize our economic foundation. Korean society has hesitated to embrace the reform process, citing concerns about its immediate effectiveness and short-term pain. It's time for intense collective dialogue and concerted action to safeguard our nation from the brink of complete collapse.