South Korea is Progressing Fast, China may Create Obstacles

South Korea is Progressing Fast, China may Create Obstacles

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South Korea is Progressing Fast, China may Create Obstacles

Samsung Galaxy smartphone
Samsung Galaxy smartphone | Source

South Korea is Progressing Fast, China may Create Obstacles


Breaking China-North Korea nexus is important

After the death of North Korean dictator Kim-il-Jong followed by the succession of his young son Kim-un-Jong to power in Pyongyang, South Korea is keeping its fingers crossed at future events that will take shape in North Korea. On the one hand South Korea has to take care of its internal matters like state of the economy to keep it going. On the other hand South Korea should initiate steps to somehow break the China-North Korea nexus that is proving to be its bête noire.

Cracking down on financial irregurities

Recently South Korea has vowed to crack down on stock market manipulation including insider trading. Lot of irregularities are alleged to take place in the Korean Exchange Bank. As South Korea has grown prosperous and affluence is being enjoyed by its people, financial scams also are surfacing. There is a wide gap between the economies of North Korea and South Korea. North Korea enjoys a per capita income of only 5% of South Korea’s. North Korea is also incapable of feeding its population as it spends all its income on weapons and nuclear plants. People in North Korea cannot even protest because they will be mercilessly killed by the harsh regime.

China supplies nuclear weapons to North Korea to destroy South Korea

North Korea would have already fallen into the folds of South Korea but for the Chinese protection. China supplies nuclear technology to North Korea and also assists it to build up its military through conventional weapons. At one opportune stage, China wants North Korea to either to invade and capture South Korea or to drop nuclear weapons and destroy South Korea.

North Korea is jealous of South Korea’s prosperity

North Korea is jealous of the prosperity of South Korea. South Korea has become a mass market for luxury goods. In the mass market outlets, high-end luxury goods are sold, which is proving to be a success. India and South Korea have commenced their talks to tweak comprehensive economic pact. India has become world’s fifth largest economy and it is most appropriate that India and South Korea should build a strong economic relationship to the benefit of both the countries. India imported goods worth $11.4 billion in 2010. The figure in the first 8 months of 2011 is $8.5 billion. In 2010, India exported goods worth $5.6 billion to South Korea. In the first 8 months of 2011, the figure was $5.5 billion. The earlier agreement that came into force from January 1st 2010 has lost its relevance because the tariffs agreed to earlier have become meaningless. Therefore fresh negotiations are on to give further impetus to the trade relations between the two countries. India and South Korea have targeted a $30 billion trade by the year 2014.

South Korea’s economic fundamentals are quite sound

To ease the impact of international economic uncertainty, South Korea has proposed a Budget amounting to 326.1 trillion won ($272.7 billion) to create jobs. This is a 5.5% rise over the previous year’s figure. 562000 jobs will be created by the government. Many South Koreans, affected by the hardship of the tough times have vented their anger on wealthy family businesses called Chaebols. It is the same sort of feeling the poor Americans have against the wealthy corporate executives. Actually, South Korea’s economic fundamentals are quite sound unlike that of USA. But the over-reactive regulators scare away the investors. Bank of Korea has kept its key interest rate at around 2.75%. Bank of Korea, South Korea’s Central Bank has bought gold after a gap of 13 years. This was done with a view to diversify its foreign exchange reserves. It bought 25 tonnes of gold in the international markets at market rate in the months of June and July 2011.

USA prevented China from invading South Korea

When S&P downgraded USA’s rating, it affected Seoul more than Washington. Capital fled and stock market plunged in Seoul. This was because South Korea is overly dependant on USA for both external and internal support. South Korea does not have a sizeable population to rely on either savings or domestic sale of the products produced, unlike India and China. South Korea is dependent on exports to USA. Therefore when American economy falters, one can understand the reaction in Seoul. Externally, it was USA that saved South Korea from falling into the hands of China. MacArthur’s army fought the Korean War on Korean soil and saved South Korea’s sovereignty in 1953 at the 38th parallel. Dwight Eisenhower, himself a World War veteran, understood the need for physically despatching the American troops in the guise of UN troops to fight the Chinese Red Army. China was greatly disappointed at this American overture as otherwise it would have captured both North Korea and South Korea. After this, China could have easily invaded and captured other nations like Singapore, Malaysia, Hong Kong (at that time a British Colony), and Vietnam etc.

South Korean companies are winning laurels world wide

India and South Korea have signed a civil nuclear cooperation treaty. Korea Electric Power Corporation has signed an agreement with Nuclear Power Corporation of India to establish nuclear power plants in South Korea. South Korea can also participate in India’s nuclear expansion programmes. South Korean companies are dominating the world as Japanese companies dominated in the seventies and eighties. Samsung has become number one smartphone manufacturer in the world. Samsung’s Galaxy series of smartphones are attracting young people in droves. LG is also doing very well in consumer electronic and home appliances world over. Now two South Korean companies have submitted their bids for a controlling stake in Hynix Semiconductor, the second largest maker in the world of memory chips. The two companies are the shipbuilder STX Group and top mobile carrier SK Telecom. Two South Korean constructors have won a combined $2.5 billion order from Saudi Arabian State Oil Company to construct a major gas plant in the Kingdom. Samsung Engineering secured order worth $600 million while SK Engineering & Construction won the order worth $1.9 billion. The plant will have to be constructed north of Jubail. It will handle 70 million cubic metres of gas per day. The plant is likely to be finished in 2014 and will be the biggest of its kind in Saudi Arabia.

South Korea should sign more defence pacts with USA

The way South Korea is progressing has kindled jealousy in the minds of North Korea and China. While North Koreans have nothing to eat other then human excreta and urine (even for dong this they need government permission), South Koreans are spending their evenings in posh restaurants, tasting international cuisines. North Korea is so angry that it feels to drop a big bomb on Samsung factory to destroy that company. China also wants to do so. But the hands of China and North Korea are tied by their fear of USA. USA saved India in 1962 against Chinese aggression. But for US intervention, China would have captured entire India. USA saved South Korea in 1953 from Chinese occupation. Today, South Korea’s dependence on USA has increased. USA should help South Korea to thrive and proper. South Korea should sign more defence cooperation with USA and India to thwart of Chinese and North Korean aggression in future.

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