How Manufacturing Saved the Korean Economy during the COVID-19 Crisis

Kyung In Hwang ()
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Kyung In Hwang: Korea Institute for Industrial Economics and Trade, Postal: Sejong National Research Complex, Korea Institute for Industrial Economics and Trade, 370 Sicheong Dae-ro C-dong 8-12F 30147, Republic of Korea, http://www.kiet.re.kr

No 21/7, i-KIET Issues and Analysis from Korea Institute for Industrial Economics and Trade

Abstract: Korea’s manufacturing sector, the third most competitive in the world, has helped it weather the COVID-19 pandemic. While the global economy shrank 3.3 percent in 2020, its worst slowdown since the 2008 global financial crisis, the Korean economy contracted by just one percent thanks to its manufacturing sector. Korea’s success in stabilizing its economy faster than other major economies stemmed from its highly competitive manufacturing industry, which is the world’s third most competitive per the United Nations Industrial Development Organization’s (UNIDO) Competitive Industrial Performance (CIP) index. Despite this, the country’s industrial innovation strategy is in need of an upgrade for the post-pandemic era. This paper explores sustainable, resilient upgrade paths for the Korean economy amid intensifying innovation competition in the post-pandemic era and the battle for technological hegemony between the US and China.

Keywords: manufacturing; employment; Korea; COVID-19; exports; resilience; economic resilience; innovation; industrial structure; innovation policy; industrial policy; export policy; economic security; economic nationalism; national security; technological hegemony; US; China; conflict (search for similar items in EconPapers)
JEL-codes: F13 F16 F51 F52 L12 L51 L52 L53 L60 O21 O30 O32 O38 (search for similar items in EconPapers)
Pages: 14 pages
Date: 2021-05-06
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