The South Korean economy surprises investors with growth and new jobs

Posted on May 31, 2013 at 5:05 PM

Although many investors and lawyers are focusing on China and the Middle East, South Korea is quickly gaining attention as an economic powerhouse. The South Korean economy surprised skeptics by growing 0.9% in the January to March quarter. Increases in construction, investments, and exports all added up to push South Korea’s growth rate to a two-year high.

Now seems like South Korea’s economic moment. Its technology and automobile companies, like Samsung Electronics and Hyundai Motors, are quickly catching up with companies like Apple and Toyota. In fact, Samsung beat out Apple in consumer loyalty for the first time in 2013, and Samsung leads Apple in smartphone market share and may beat out Apple in smartphone profits this quarter.

South Korea’s entertainment industry is booming as well. Its television programs and music groups have won fans throughout Asia, Europe, and America, thereby creating a form of soft power that familiarizes Americans with South Korean culture and language. This penetration of culture adds to South Korea’s growing status as a powerful presence in the global market.

Even though experts predicted that the South Korean export market would be hurt by decreased demand in the United States and the Eurozone, that has not been the case. In fact, there was a 3.2% growth in exports over the January to March quarter.

Meanwhile, the South Korean government is implementing a $15.3 billion stimulus plan. The plan is expected to create 40,000 jobs and increase annual growth by 0.3 percentage points.

Plus, South Korea is investing $2.7 billion into funding startups, creating a third stock market, and making it easier for companies to raise money through crowdsourcing.  Even as traditional companies in South Korea are booming, new companies are angling to fill any gaps in the global economy. That booming economy will create more business for lawyers operating in South Korea, and recent changes in the South Korean legal system make it easier to practice law there now more than ever.

U.S. and U.K. law firms are now allowed to open offices in South Korea. The government also changed the rules regarding law schools. Before 2009, only 1,000 graduates who passed an extremely difficult bar exam and then studied at a government-sponsored school could practice law in South Korea. Now, students can attend any number of U.S.-style postgraduate law schools.

As the automobile, technology, and entertainment sectors continue to expand, the South Korean economy will continue its strong start to the year. The increase in government spending overall and in startups in particular will allow the economy to continue to grow and diversify, creating new jobs and new legal opportunities.


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