chapter  4
Impact for export and job creation
WithSeung-hun Chun
Pages 18

The key issue was how to escape the vicious circle of poverty. The Korean government thought that the usual harmonized, balanced development policy may result in a hamster-wheel effect, in which efforts to move forward resulted in no progress. So it tried to give impacts on the critical point of the cycle persistently until the chain was broken. The critical point was surmised in its “export promotion for job creation” dictum. To promote exports, the government set up annual and medium-term export targets and monitored them through the monthly Export Promotion Committee chaired by the president. It also introduced incentive packages including a favorable exchange rate policy, tax benefits and financial support for exports. To create job opportunities, the only option was to export the labor force abroad. Korean workers were employed on a large scale as coal miners in West Germany and as construction workers on major projects in the Middle East in the 1960s and 1970s. The remittances of these overseas workers made a great contribution to foreign exchange earnings and effectively allowed the collection of seed money for industrial development.