The South Korean Economy in the Face of New Challenges

ABSTRACT

The South Korean economic miracle is often used as an example of the consolidation of business and government in the interests of national prosperity. Thanks to rapid industrialization and the implementation of an export-oriented economic model, the Republic of Korea (ROK) acquired the status of a developed country already in the mid-1990s. An important factor of South Korea's success at the global level is the fact that the foreign economic relations of the ROK have been closely intertwined with access to world markets, technologies, and investments. However, the economic crisis triggered by the COVID-19 pandemic and global geopolitical differences have been testing even the most stable economies. Since the South Korean economy has been deeply integrated into international trade and finance, it has become very vulnerable to outside challenges. The strengthening of partnership cooperation with the US requires that President Yoon's administration dramatically diversify foreign economic ties. Of special interest here are Russian-South Korean economic ties and their prospects. At present, the two countries' economic partnership is facing a major test in the form of sanctions pressure on the Russian Federation. As for domestic challenges for South Korea, the new administration of President Yoon has inherited many unresolved problems that have only been worsening - primarily unemployment (especially among young people), inflation, a housing crisis, and the country's ag ing population. In this article, the authors analyze current foreign and domestic challenges facing the ROK economy. In addition, emphasis is placed on issues of Russian-South'Korean economic relations.