Korea’s Free Trade Agreement with five Central American countries recently entered into force, creating substantial expectation that the Agreement would help both Parties facilitate and expand trade and investment, and thereby strengthening bilateral economic partnership. The Agreement has a comprehensive coverage from goods trade to services liberalization and investment to intellectual property rights, and even includes access to government procurement markets and a wide range of cooperation priorities. Especially, its conclusion drew substantial attentions because the Agreement marks fourth of its kind for Korea to create a free trade network with Parties from Latin American, next to Chile, Peru, and Colombia, among the 16 FTAs that the country has concluded.
   Against the backdrop, this study explores Korea-Central America FTA’s trade and investment implications. Especially, it analyzes prospective products and sectors in which bilateral trade and investment opportunities would increase, and suggests that Korean exporters and policymakers have to make stronger and continued efforts to realize the potential benefits accruing from the Agreement in those analyzed sectors and areas.
   To this end, the study is composed of three main analyses that incorporate implications for trade in goods, trade in services, and investment, respectively. Since the five Central American parties of the FTA, i.e. Costa Rica, El Salvadore, Honduras, Nicaragua, and Panama, act individually, not collectively as a group or a customs union, the study includes a separate analysis for each of them.
   Chapter 2 examines recent trade and industrial developments and trends of the Central American parties. It also discusses their trade and FTA policies, including implementation of special economic zone or free trade zones. Major findings suggest that the Central American parties generally pursue trade liberalization, and have already concluded FTAs with various partners like US, EU, Mexico, Chile and other countries in the Latin American region as well as Taiwan, Singapore and China in Asia. Also, they show that some of the Parties - specially, Costa Rica and Panama – actively sought to attract foreign investments and participate in regional values chains, through which they have fostered open and relatively conclusive environment for investments. Nevertheless, Korea’s trade with the Parties prior to the FTA was relatively small, compared with its trade in other parts of the globe, and was even increasingly pushed away in local markets by growing competition with other suppliers like China and Japan.
   Chapter 3 analyzes prospective products in which Korea’s trade with the Central American parties would increase. To identify most relevant variables that would positively affect post-FTA trade growth, the analysis first examines cases of Korea’s FTA with Chile, Peru and Colombia. As a result, it finds that size and growth rate of the import market, and Korea’s export competitiveness generally led to trade increase in intensive margin in those previous cases. In addition, it finds that level of competition also plays important role for FTA’s trade effect, especially for trade expansion in extensive margin. Based on the clarification of relevant variables, the analysis further suggests most likely and desirable export items to each Central American market.
   Chapter 4 analyzes prospective sectors in which Korea’s services trade with the Central American parties would increase. To this end, it examines recent trends of services trade in each parties, compares levels of service market liberalization before and after the FTA, and explains important government policies for major services market liberalization. Based on the analysis of overall conditions and policy directions in major services market, the study further suggests that Korea has relative competence in public services, construction, AI education, digital government and online distribution services, among others.
   Chapter 5 analyzes investment opportunities in the Central American parties. The study explores recent trends of foreign direct investment in the five countries and discusses business environment, overall business capacity and development of investment protection under trade agreements. The analysis also finds that Korea’s investment in the region has been substantially low, which is likely to remain unchanged in the near future. Nevertheless, the FTA can help create better investment conditions in the long term, and Korea’s recent build-ups for investment and value chain formation in other parts of Latin American can positively contribute to fostering its extended investment in the Central American region.
   Overall, this study provides statistical and regulatory information of the five Central American parties of the Korea-Central America FTA. It also provides a longer-term perspective that exporters and policy-makers can consider in utilizing and implementing the FTA that recently entered into force. 

   In 1990, the socialist economic system of East Germany was incorporated into the “Social Market Economy (Soziale Marktwirtschaft)” of West Germany, completing political, economic and social unification. The economic state of East Germany was in a more serious state than expected. With unification, East Germany’s GDP fell by more than 30%, and the unemployment rate rose sharply to over 15%, and in the late 1990s, the unemployment rate in East Germany drew near 20%. 
   During the time of unification in 1990, the economic gap between East and West was the biggest problem in the process of social and economic integration. Since the reunification, the German government has made various efforts to bridge the regional gap between East and West Germany. The income of East Germans has now reached 80% of West Germans, and the productivity of labor has steadily improved to 80% of the average of the West German workers. 30 years after reunification, Germany is now the largest economy in Europe and it has the world’s fourth highest nominal GDP.
   Despite these positive aspects, the income and productivity gaps between East and West are still widening, and the rate of economic convergence is falling significantly. Moreover, the bigger problem remains in that skilled or professional workers are moving to West Germany due to the fact that there are not enough attractive jobs in the East.
   The study aims to find whether the gap in economic power between the East and the West is decreasing and if the economies of East and West are converging in the process of economic integration. If the economies of the two regions have in fact converged, then it strives to discover the factors causing the convergence. It also intends to determine the remaining problems and challenges that exist to this day. In particular, by examining the factors that promoted the growth of the East German region and comparing them with the West German region, the study aims to provide policy implications for the unification of the Korean Peninsula. 

   This study has two main research objectives. First, the study evaluates the possibility of cooperation between Korea and China and proposes a number of cooperative projects, based on China’s cooperation with ASEAN, which is mainly strengthened through bilateral initiatives, particularly in the sustainable environment sector. Second, under the New Southern Policy, this study derives cooperation strategies for ASEAN in the field of environmental sustainability. Keeping the COVID-19 pandemic that is sweeping the entire world and the emerging security trend of prioritizing state sovereignty in mind, we actively seek to address human security concerns in major governmental policies, prioritizing human life and dignity. While the New Southern Policy puts an emphasis on humanity, the goal of a sustainable environment – which has a direct impact on human life – has not been properly established in the policy. As Korea’s past ASEAN policy was focused on economic profit and market acquisition, it is now crucial to build trust in the relationship with ASEAN through a human-centered approach, and to expand cooperation across broader areas. The outcome of this study will prepare measures to promote cooperation with ASEAN, which is an important component of the New Southern Policy
   The major content of this study is as follows. Chapters 2 and 3 respectively analyze the overview and outcome of China-ASEAN environmental cooperation, and the overview and outcome of Korea-ASEAN environmental cooperation after 2010. Specifically, Chapter 2 describes China’s strategy with regard to environmental cooperation with ASEAN, and summarizes the overview of ASEAN cooperation and the major cooperation mechanisms. Based on these, this study identifies the outcomes and limitations of China-ASEAN environmental cooperation. The outcomes of China-ASEAN environ- mental cooperation include the launching and operation of the China- ASEAN Environmental Cooperation Center, reaching an agreement and adopting a policy concerning green development, operating the China-ASEAN Environmental Information Sharing Platform, establishing Lancang-Mekong Sustainable Infrastructure and Green Investment and Financing, and fostering active technological cooperation and human resources exchanges with ASEAN. Despite the above mentioned outcomes of China-ASEAN cooperation in the sustainable environment sector, there still remain a number of limitations in this cooperation. First of all, overseas projects based on the China’s Belt and Road Initiative follow low socio-environmental guidelines, or lack mandatory regulations. For these reasons, the lack of environmental consideration in the process of building the infrastructure has caused environmental pollution and destruction in the recipient countries, provoking the continued opposition of local communities. In addition to the complaints about environmental pollution and destruction, overseas projects are funded by Chinese capitals, laborers, companies. This does not bring much in the form of tangible benefits to the governments and nations involved in the China’s Belt and Road Initiative, resulting in a backlash among those recipient countries. In addition, there is a considerable gap between China and ASEAN countries in terms of their views on environmental sustainability, and China lacks the capacity to provide environmental assistance. In addition, the financial assistance required for performing ASEAN cooperation is insufficient in China.
   Chapter 3 presents an overview of Korea-ASEAN cooperation in the area of environmental sustainability, the major cooperation mechanisms, and ODA status in relation to the New Southern Policy. Based on this, it examines the outcomes and limitations of the current status of Korea- ASEAN environmental cooperation. The ROK government has been strengthening the cooperation with ASEAN by hosting 2019 ASEAN- Republic of KOREA Commemorative Summit. The ROK government are also currently operating the New Framework for the ASEAN-ROK Cooperation Fund(2017-2020) and ASEAN-Korea Environmental Cooperation Project(AKECOP) across all ASEAN-Korea sectors including environmental cooperation. However, ASEAN-Korea Environmental Cooperation has limitations. For instance, this cooperation lacks strategies that integrate mid-term and long-term plans, and it is not implemented strategically from a mid-to–long-term perspective. In addition, the foundation for cooperation with individual ASEAN countries is relatively poor. The ASEAN cooperation tends to focus only on a few specific countries, including Vietnam. There are lack of consideration for mainstreaming environmental sustainability in the New Southern Policy.
   Based on this discussion, Chapter 4 presents a SWOT analysis on the current status of ASEAN-China environmental cooperation to explore implementation strategies for Korea-China cooperation and the New Southern Policy. On the basis of this analysis, this study proposes an implementation strategy for Korea-China cooperation and the New Southern Policy in the area of environmental sustainability. Some of the main strengths identify through the SWOT analysis for South Korea are; a favorable public opinion compared to China, ASEAN being our second-largest trade partner and our third-largest investment market (as of 2018), the establishment of the new ASEAN initiative, our active cooperation with ASEAN in the environmental sector, and the relatively richer ODA experience compared to China. The weaknesses are; the lack of organization and a mid-to-long-term plan for the ASEAN-Korea Environmental Cooperation, relatively smaller-scale assistance compared to China and Japan, the relatively poor channels with individual ASEAN countries and unbalanced cooperation and lack of consideration to mainstream environmental sustainability. Opportunity factors have been identified as; the emergence of production and consumption hubs as an alternative to the Chinese market, the agreement of Korea-ASEAN Free Trade Agreement, continued efforts to integrate the ASEAN Economic and Social Community in the region, the government’s strong will for sustainable development following economic growth, and an increased preference for Korea owing to the Hallyu(Korean Wave). Finally, the threats are identified as; intensifying competition due to Chinese expansion to the ASEAN region, high political instability in certain countries, and the lack of governance capacity of ASEAN countries. Based on this SWOT analysis, the environmental sustainability sector for Korea-China cooperation would be the Smart Green City project that combines ICT-based environment and infrastructure. Furthermore, viable strategies under the New Southern Policy are; the human-centered human security approach along with economic consideration, discovering major cooperation priorities in the sustainable environment sector, mainstreaming environmental sustainability in the New Southern Policy, establishing a responsible organization and strategy for the ASEAN-Korea Environmental Cooperation, strengthening Korea’s soft power through environmental cooperation, increasing community awareness through bonding with civil society, and establishing a multilateral environmental cooperation system.
   The final chapter, Chapter 5, describes the main conclusion and limitations of this study. It is crucial to relate the mainstreaming of environmental sustainability with the New Southern Policy. When establishing an upgraded version of the New Southern Policy in the near future, it is necessary to integrate the Sustainable Development Goals (SDGs) with the New Southern Policy in order to mainstream environmental sustainability.
   Due to the unexpected outbreak of the COVID-19 pandemic, unfortunately, oversea field research was not possible. therefore, this study was conducted using only a review of the related literature and domestic expert seminars. In future studies, it is necessary to develop specific projects for all the member countries of the ASEAN cooperation, and to analyze the current status of ASEAN-Japan environmental cooperation.

 Executive Summary

 

 I. Introduction

 

 II. Progress of Financial Inclusion
 1. Achievements of Financial Inclusion
 2. Limitations of Financial Inclusion and Advent of Digital Inclusive Finance

 

 III. Fintech and Digital Financial Inclusion
 1. Definition of Fintech and Digital Economy
 2. The Impact of Fintech Development on Personal and Corporate Finance
 3. The Benefits and Costs of Fintech and Digital Financial Inclusion

 

 IV. Promotion of Digital Financial Inclusion in Asia
 1. Digital Financial Inclusion in Asian Countries
 2. Tentative Empirical Results on the Effects of Financial Inclusion
 3. Main Implications

 

 V. Conclusion

 

 References

 

 Appendix

   Since the 2008 global financial crisis, including the recent COVID 19 pandemic, low interest rates and low economic growth have continued around the world. In spite of this low interest rate trend, as the economic downturn prolongs, there is a situation of concern called the “new normal” of low interest rates and low economic growth, and low prices. In this new normal economic structure, the rapid progress of aging is increasing the necessity and desire for asset accumulation. In addition, digital finance such as Fin-tech with the evolution of the underlying technologies and the emergence of new technologies has replaced or improved many functions of existing finance in the advent of the 4th industrial revolution era.
   These changes are expected to bring benefits to the individual and corporate finance sectors, which have been subject to financial inclusion. On the other hand, digital finance, which is changing at such a rapid pace, may further isolate some individuals who were in the blind spot of finance, such as the elderly, and a support system for this is an issue that should be included in the policy of financial inclusion in each country.
   In this paper we find that Asian countries like other regions have achieved tangible results in financial inclusion while achieving financial deepening. When looking through various financial inclusion indicators such as holding accounts and loans, ATMs, and bank branches, the Asian region has achieved similar or superior performance to other regions. Compared to the income level, the growth of financial inclusion in Asia was found to be attributable to better performance in middle-income countries than in other similar regions. High-income countries in Asia are performing somewhat lower than similar peer groups in other regions, but this seems to be due to stagnation of growth. More seriously, financial inclusion in low-income countries in Asia is not appearing faster than in other income groups.
   In Asian countries there appears to be a wide variation in regional financial inclusion. However, Asian countries are expanding around the younger generation in the use of ICT technology that is helpful in spreading financial inclusion so if digital inclusive finance centered on Fintech is properly applied, Asian countries will become a new model for digital financial inclusion. However, since the gap in the use of Fintech in the region is large, how to fill this gap is being raised as an important policy task for each country as well as the whole region.
   We also tentatively examined the effects of financial inclusion and digital financial inclusion in the Asian region using the Asian country panel data collected from WDI and Global Findex data. Looking at the implications of the empirical analysis results even though it is very cautious to interpret the results of this analysis due to the lack of data of inclusive finance in Asia., first, the expansion of financial inclusion(such as ATM) in Asia seems to have some relationship with the reduction of poverty rates and income inequality which is measured with Gini coefficient. And the expansion of internet usage in Asia seems to have some relationship with the reduction of poverty rates and income inequality although we use it as the proxy variables instead of the digital financial inclusion variables. Lastly, the higher share of rural population which is used as a proxy for digital divide, which may occur due to the expansion of digital inclusive finance in Asia, has the potential to erode some of these achievements, but there is still a possibility that the expansion of inclusive finance will be effective.
   Despite the likelihood of success in digital inclusive finance in the future, digital divide spreads due to various gaps such as between urban and rural areas, between young and old, between low and high income, and between men and women, occurring in Asian countries and may worsen the performance of inclusive finance. Thus the governments in the region need to actively intervene to resolve these gaps. In addition, it is necessary to close the digital gaps that is occurring between countries through policy cooperation among APEC members.
   Considering the situation that the degree of development of Fintech in each member is expanding financial inclusion, it is necessary for Korean financial companies to set up an advancement strategy that focuses on the financially marginalized class based on the advanced system strategy of credit rating based on big data.
   Our analysis results will give some implications for the New Southern Policy. Personal and SME finance are very important business areas when financial companies currently enter the ASEAN region, and accurate analysis of each member' current status for Fintech or digital finance and financial inclusion should be given priority in terms of business expansion.

 

 Keywords: Fintech, Digital Finance, Financial Inclusion, Comparative Studies of Countries
 JEL Classification: O33, G19, G20, I31, O57

Введение 

Глава 1. Государственная политика РФ в области развития цифровых финансов 
1. Основные направления, цели, программа и приоритеты государственной политики цифровизации в финансовой сфере 
2. Система государственных мер по развитию цифровых финансов и обеспечению их безопасности 
3. Развитие электронного документооборота и облачных сервисов при взаимодействии государства и бизнеса 
4. Перспективы развития государственного регулирования в области цифровых финансов в России 
5. Обеспечение безопасности при развитии финансовых технологий
6. Перспективы развития цифровой финансовой инфраструктуры 

Глава 2. Цифровизация общественных финансов 
1. Архитектура и функционирование Государственной интегрированной информационной системы управления общественными финансами «Электронный бюджет»
2. Цифровые финансы государственных внебюджетных фондов 
3. Перспективы развития цифровых общественных финансов 

Глава 3. Роль Банка России в развитии цифровых финансов 
1. Политика Банка России в области цифровых технологий 
2. Современное состояние цифровых технологий в деятельности Банка России 
3. Регулирование цифровой финансовой инфраструктуры 
4. Перспективы внедрения новых инициатив Банка России в области цифровых технологий  
5. Цифровые платформы Банка России (быстрые платежи, удаленной идентификации, маркетплейс, облачных сервисов) 

Глава 4. Рынок цифровых технологий для финансово-банковского сектора 
1. Виды цифровых технологий для финансово-банковских организаций, представленные на рынке России и их основные поставщики 
2. Собственные разработки ИТ-подразделений крупнейших банков 
3. Опыт цифровизации деятельности в крупных банках 
4. Опыт цифровизации в мелких и средних банках 
5. Перспективы развития банковского цифрового бизнеса и развития рынка цифровых технологий для финансово-банковского сектора

Глава 5. Цифровизация национальной платежной системы 
1. Архитектура, функционирование и управление рисками в Национальной платежной системе 
2. Развитие системы платежных карт «МИР» 
3. Развитие системы быстрых платежей 
4. Перспективы развития Национальной платежной системы России 

Глава 6. Цифровизация страховой деятельности 
1. Механизмы электронного взаимодействия  участников страхового рынка 
2. Современное состояние цифровых технологий в российских страховых компаниях 
3. Перспективы развития цифрового страхового бизнеса 

Глава 7. Цифровизация рынка ценных бумаг 
1. Механизмы электронного взаимодействия на финансовом рынке  
2. Современное состояние и перспективы развития цифровизации деятельности торговых площадок 
3. Современное состояние и перспективы развития цифровизации деятельности профессиональных участников рынка ценны бумаг 

Глава 8. Домохозяйства в цифровой финансовой среде 
1. Формы и степень вовлеченности населения в цифровую финансовую среду 
2. Перспективы развития цифровых финансовых услуг для населения 
3. Состояние и перспективы развития цифровых небанковских платформ частного финансирования 

Глава 9. Перспективы развития финансовой цифровизации в  России 
1. Развитие цифровых платежных сервисов 
2. Развитие программ цифрового финансирования 
3. Развитие систем управления капиталом 
4. Развитие цифровых платформ на основе технологии распределенных реестров

Глава 10. Направления международного сотрудничества России в области цифровизации финансов 
1. Примеры международных проектов с участием России в области финансовой цифровизации 
2. Перспективы развития международных проектов России и Республики Корея по цифровизации финансов 

Заключение 

Использованная 

Список сокращений 

   Среди всех секторов экономики России наиболее быстрые темпы процессов цифровизации наблюдаются в финансовом секторе, представители которого ведут активную работу по внедрению цифровых технологий во все бизнес- процессы.
   Цель проведенного исследования - определение ключевых трендов цифровой трансформации финансовой системы России. В монографии представлена характеристика текущего состояния цифровизации финансов в России, а также обозначены перспективные траектории для дальнейшего углубления международной кооперации в данной области.
   В ходе исследования был сделан вывод о значимой роли государства и Банка России в сфере разработки и имплементации финансовых технологий. Государство активно переводит в цифровой формат собственные услуги, способствуя интеграции в этот сегмент цифровых финансовых решений, а Банк России выступает инициатором и координатором внедрения цифровых технологий на финансовых рынках, активно развивая цифровые платформы для усиления конкуренции и повышения доступности финансовых услуг. Все эти инновации потребовали приведения существующей нормативно- правовой базы в соответствие с вызовами цифровой экономики. Ход этих процессов всесторонне исследован в работе.
   Анализ процессов цифровизации банковской сферы показал, что крупные российские банки инвестируют значительные средства в цифровые технологии для того, чтобы удовлетворять растущие потребности клиентов и выдерживать высокий уровень конкуренции. Отмечено, что один из лидеров цифровизации в России - ПАО «Сбербанк» уже реализует ряд инициатив совместно с технологическими компаниями Республики Корея и нацелен на расширение взаимодействия с корейской стороной в целях разработки и совершенствования финансовых технологий. Данная успешная модель сотрудничества может быть взята на вооружение другими российскими кредитными организациями.
   В России успешно функционируют инновационные fintech- и insurtech- стартапы, некоторые из них могут быть интересны представителям Республики Корея. Кроме этого, целесообразным представляется также создание совместных площадок и акселерационных программ, объединяющих корейские и российские стартапы в сфере цифровых технологий и способствующих их взаимопроникновению на рынки обеих стран.
   Взаимодействие на уровне национальных финансовых регуляторов России и Республики Корея имеет первостепенное значение для проработки и обсуждения вопросов регулирования в сфере финтеха, а также противодействия угрозам в области информационной безопасности. Совместная работа Банка России и Комиссии по финансовым услугам (FSC) может быть организована в рамках «регуляторных песочниц» путем создания рабочих и консультационных групп.
   Авторы уверены, что объединение потенциала российской науки в области научных исследований и практического опыта южнокорейского бизнеса может также послужить дополнительным импульсом для ускорения процессов цифровизации в страховом секторе, прежде всего, за счет развития телемедицины и совместных стартапов.
   Среди других приоритетных направлений сотрудничества России и Кореи в монографии выделено также установление партнерства в сфере розничной торговли и онлайн-платежей. По мнению авторов, создание трансграничных торговых платформ, а также их интеграция с платежными сервисами позволит существенно увеличить товарооборот стран.
   Авторы изучили тенденции, характеризующиеся распространением финансовых технологий среди населения. Анализ ключевых индикаторов свидетельствует, что Россия по-прежнему уступает странам–лидерам в области цифровизации по степени вовлеченности домохозяйств в цифровую финансовую среду. В связи с этим для России важным направлением сотрудничества с Кореей является работа по совершенствованию инфраструктуры связи и распространению высокоскоростного интернета 5G по всей территории страны.
   Перспективно формирование единого международного финансового рынка, поддерживающего устойчивый информационный обмен, сопряжение регулирующих практик и финансовую безопасность. Выход иностранных эмитентов на российские биржевые площадки привел к настоящему буму среди частных инвесторов, проявивших значительный интерес к зарубежным ценным бумагам. Быстро развиваются и проекты допуска российских инвесторов к торговле криптовалютами на иностранных площадках.
   По итогам исследования авторы пришли к выводу, что потенциал расширения кооперации между Республикой Кореей и Российской Федерацией в сфере цифровизации финансовой системы весьма широк. Сближение накопленного опыта науки и практики России и Республики Корея является взаимовыгодным и, несомненно, будет способствовать ускорению и повышению эффективности цифровой трансформации в обеих странах.

Executive Summary   Ⅰ. Introduction Ⅱ. Data and Methodology 2.1. Data to Use 2.2. Landscape of APEC RTA from the database 2.3. Methodology: Text similarity as a measurement of RTA convergence Ⅲ. Analytical Findings 3.1. Overall trend of convergence 3.2. Who leads the convergence: Clustering aspects 3.3. Who leads the convergence: Development aspects Ⅳ. Further Analysis: convergence by chapters Ⅴ. Robustness Checks Ⅵ. Concluding Remarks References Appendix A. Lists of Key Variable Name B. Convergence of APEC RTAs by Chapters

In this paper, I suggest that text mining analysis of regional trade agreements (RTAs) can be a suitable methodology to develop a tangible measure of convergence between RTAs. By utilizing well-established text similarity concepts in related literatures, I attempt to investigate how much RTAs in APEC are converging in terms of how much similar RTA texts are. Furthermore, which areas of RTA converge more or less will be examined. The main results of the study are as follows. The RTAs signed by APEC members are gradually converging over time, and they converged (in terms of 5-gram Jaccard similarity) at an annual average of 8% for all RTAs (both inter- and intra-regional) while 9.7% for intra-regional RTAs only. The areas that converged the most are service and transparency chapters, which show 2.2 times and 1.6 times higher level of convergence than the average, respectively. The objective and intuitive indicators of regional norm convergence are expected to provide a common understanding for setting goals and strategies for regional economic integration in the future.

Executive Summary Ⅰ. Introduction Ⅱ. Measuring Industry Participation and Position in GVCs 2.1. Industry Participation in Vertical Specialization Linkage: Backward and Forward Participation Rates 2.2. Industry Position in Production Line: Upstreamness and Downstreamness Indices Ⅲ. Industry Participation and Position in GVCs: Statistical Observations from APEC Member Economies 3.1. Forward and Backward Participation Rates 3.2. Upstreamness Index Ⅳ. The Value-added Creation Effect of GVC Participation: An Empirical Investigation for APEC Member Economies 4.1. Model Specification 4.2. Data and Summary Statistics 4.3. Empirical Results 4.4. Policy Implications Ⅴ. Summary and Concluding Remarks References Appendix

We analyze the value-added creation effect of GVC participation by applying a standard fixed effects regression model analysis with economy-wide country-industry data. We use OECD Inter-country Input-Output Tables covering 64 countries (21 APEC members and 43 non-APEC members) and 35 industries (1 Agriculture, forestry and fishing, 3 Mining, 16 Manufacturing, and 15 Service) between 2005 and 2015. We find that APEC member economies’ participation in GVC activities is not distinct from non-APEC member economies but the causal relationship between GVC participation and created domestic value-added is much stronger in APEC member economies. More specifically, from the qualitative evaluation on statistical data, we find that backward linkage has been stronger than forward linkage and both have been recently decreasing. The APEC industries’ upstream positions in production line have been slightly more distinguished than non-APEC industries. From the econometric regression analysis, we find that forward participation in GVCs is more desirable than backward participation in terms of creating domestic value-added. We also find that the industry position in middle stages of production line in contrast to earlier and later stages creates higher domestic value-added per output unit. This implies that the firm-specific conventional U-shaped “Smile Curve Hypothesis” is not applicable at the economy-wide country-industry level, especially in APEC member economies. This finding supports that manufacturing industries are still a major driving force for less developed APEC member economies to move up the development ladder. Considering that gains from GVC participation are diversified across industries and upgrading country-industry positions in GVCs is competitive among the interconnected countries, we strongly recommend for APEC member economies to construct effective domestic value chains and coordinate with other members during their process of upgrading GVC participation.

   Mongolia is one of the world’s top 10 resource-rich countries, with high growth potential based on abundant mineral resources such as copper, gold and coal on its vast land, which is more than seven times the size of the Korean Peninsula. It has received much attention due to its geopolitical importance in Northeast Asia, and is actively promoting cooperation with the United States, Korea, Japan and European countries in addition to Russia and China. It is also expected to play a certain role in promoting peace and stability on the Korean Peninsula as a country of simultaneous diplomatic relations between the two Koreas. However, Mongolia has a population of around 3.3 million and its income level is not high, and thus the small market remains limited in size. As of 2019, Mongolia’s total GDP is about $14 billion, and per capita GDP at just over $4,200. There are also various constraints and difficulties in transportation as a land-locked country.
   Nevertheless, the strategic value and importance of Mongolia should be highly valued. The first reason is that the Mongolian economy has high potential for future development. Many international organizations predict that Mongolia will be able to achieve economic growth of around 6% annually in the future based on abundant resources. In terms of economic structure, resource-rich Mongolia and Korea, where technology and capital have a comparative advantage, can form a complementary relationship. Second, Mongolia has been regarded as a country that achieved political democratization since it switched to a market economy in 1990, and has been improving its international status through China-Mongolia-Russia cooperative relations. Northeast Asia is an area where the need to establish a multilateral peace and security system is growing. Strengthening friendly relations with Mongolia and sharing the vision of future cooperation are also in line with the direction that Korea’s New Northern Policy is pursuing. Third, Koreans and Mongolians share cultural friendliness and emotional bonds with each other. Currently, nearly 50,000 Mongolians in Korea form part of Korean society, and historically, they have called Korea “a country of rainbow” and expressed friendly sentiment. In Mongolia, interest in the Korean language is as high as that for English and Japanese, and the Korean Wave is also quite strong in popular culture. Emotional friendliness and amicable feeling are important factors as the basis for future cooperation between the two countries.
   Korea already accounts for a high proportion of Mongolia’s economy in terms of trade volume and direct investment. Mongolia is the second-largest ODA partner for Korea and continues to share the development experience of the Korean economy. With bilateral summits and high-level talks continuing since the establishment of diplomatic ties, the two countries currently have a ‘comprehensive partnership’ and are seeking to upgrade to a “strategic partnership” in the future. Mongolian students studying in Korea rank third in terms of the size of foreign students, and they are growing as resources to take charge of the future of bilateral exchanges and cooperation. A group of Mongolian students studied in Korea, and many pro-Korean figures have organized a human network to assume the role of a channel for civilian diplomacy between the two countries.
   Under the global economic environment that has entered a low-growth era, Korea is pushing its New Northern Policy to seek new growth engines. Many of Korea’s main industries are now in their mature stages and need a new breakthrough, with northern countries likely to form complementary ties with the Korean economy due to their wide territory and abundant resources. Korea also needs to strengthen transnational multilateral cooperation with Eurasian countries to promote peace and prosperity on the Korean Peninsula amid geopolitical tensions and competition in Northeast Asia. Mongolia is an important partner in this situation which is highly likely to cooperate with Korea, has high demand for energy, is interested in the development experience of Korean economy, and shares mutual cultural familarity with Korea.
   In the 21st century, Mongolia once gained attention as it recorded rapid growth due to rising international resource prices. However, as the resource-based economy suffers from economic instability due to its limitations, the Mongolian government continues to push for an economic diversification policy. Mongolia established the “Long-Term Development Policy Vision 2050” in 2020, and is presenting the main goals and future plans that the country aims for. Many of the policies being pursued here are directly or indirectly in line with the direction of Korea’s New Northern Policy, and we should seek cooperation tasks to meet the demands of both countries and broaden the horizon for future cooperation. Given the policy direction that the two countries are pursuing, the vision of future cooperation between Korea and Mongolia is presented as an ‘Inclusive Shared Growth’ that will achieve peace and prosperity in the 21st century in Northeast Asia. This is because Mongolia is recognized as a member of the Northern Economic Community in the 21st century, and it is a country that needs comprehensive support from Korea while cooperating with each other.
   Marking the 30th anniversary of the establishment of diplomatic ties between Korea and Mongolia, the study was designed to explore future cooperation tasks and ways to realize them in each field. The purpose of this study, which takes the form of comprehensive regional research, is to analyze the achievements and limitations of Korea-Mongolia exchange cooperation in each field that has been carried out so far based on the cooperative environment between the two countries, and to present measures for finding and realizing cooperation tasks to overcome the problems and limitations that arise there.
   This research consists of seven chapters, including introduction and conclusion. The first section of Chapter I describes the background and necessity of the study, focusing on the strategic value and importance of Mongolia. Based on the common denominator of Korea’s New Northern Policy and Mongolia’s Long-term Development Policy, the two countries are setting the direction and vision for future cooperation. In the second section, the contents of the preceding study are reviewed and the contributions of this study are presented, focusing on the literature of Korean, English and Mongolian, and in the third section, the research methods and contents are explained.
   Chapter 2 deals with the characteristics of the Mongolian economy and the challenges in Korea-Mongolia economic cooperation. In the analysis of the economic cooperation environment for the first section, the contact point of the two countries’ economic cooperation is being sought first through the characteristics of Mongolia’s resource-based economy. To overcome the instability of the resource-based economy, Mongolia is pursuing an economic diversification policy, which could be an important point of contact for the bilateral economic cooperation. Also, the Mongolian economy has a good long-term growth outlook, which increases the possibility of future cooperation between the two countries. Section 2 analyzes the achievements and limitations of economic cooperation between the two countries in terms of trade and investment cooperation. Although Korea is one of Mongolia’s top five economic cooperation partners, there is still a limit to trade and investment volume, and Mongolia is looking for ways to improve the situation through the Mongolia-Japan EPA. Section 3 presents the vision of economic cooperation between the two countries as “Inclusive Shared Growth,” proposing the promotion of EPA and the establishment of a proper technology transfer center as a practical measure to promote economic cooperation.
   Chapter 3 deals with the tasks of Mongolia’s industrial policy and Korea-Mongolia industrial cooperation. The first section analyzes the cooperative environment between the two countries through analysis of Mongolia’s industrial structure and industrial policies, and analyzes the current status of Mongolia’s major industries such as mining, agriculture and livestock, manufacturing, and tourism. Mongolia’s “Long-Term Development Policy Vision 2050” suggests the direction of national industrial policy, which includes the selection of major strategic industries, including the fourth industrial revolution technology. Mongolia, with its vast national territory, values the development of specialized regional industries, and thus analyzing Mongolia’s regional industrial policies is also an important task in bilateral industrial cooperation. Section 2 analyzes the achievements and limitations of bilateral industrial cooperation, including Korea’s ODA. Although there are still many small and medium-sized investments to Mongolia, investment of large companies has also been on the rise recently, and the connection between the two countries’ industrial cooperation through ODA is also important. Section 3 examines the bilateral industrial cooperation tasks in Mongolia’s major industries and fourth industrial revolution technologies, and suggests measures such as boosting technical support, dialogue and cooperation channels, and strengthening the value chain of industrial cooperation.
   Chapter 4 deals with Mongolia’s political diplomacy and Korea-Mongolia cooperation tasks. The first section analyzes the political and diplomatic cooperation environment between the two countries through the analysis of Korea’s northern policy and the characteristics of Mongolia’s political diplomacy. Korea has been pursuing the Northern Policy since the late 1980s, and Mongolia is believed to have maintained its own important position under previous administrations. Mongolia operates under a dual-governance system and has a unique political system, and is considered to have a well-connected national security and foreign policy while pursuing a pragmatic diplomatic line of “The Third Neighbor Policy.” Section 2 deals with the achievements and limitations of bilateral cooperation in the political and diplomatic sectors, and the exchange and cooperation between the two governments have been developed repeatedly as summit diplomacy and high-level talks continue even amid regime changes. Section 3 deals with bilateral political and diplomatic cooperation projects, focusing on multilateral transnational projects, including participation in China-Mongolia-Russia linked projects, and plans to participate in the Northeast Asia Super Grid project.
   Chapter 5 explores approaches to expand human exchanges and cooperation between Korea and Mongolia. Section 1 examines the current status of human exchanges between the two countries and the environment of cooperation through analysis of the reasons for the expansion of human exchanges. The number of Mongolians living in Korea has reached 50,000, and Mongolian students studying in Korea have been on the rise. The reasons for their choosing Korea to study are also analyzed in various ways, including economic income and cultural friendliness. The number of Koreans visiting Mongolia has also increased significantly recently due to the demand for travel, and the Korean community in Mongolia continues to maintain its size. Section 2 presents quantitative and qualitative achievements of bilateral human exchanges, and analyzes the obstacles to expanding human exchanges. Human exchanges between the two countries are diversifying and deepening due to the establishment of pro-Korean organizations in Mongolia, active activities of Mongolian student organizations studied in Korea, and exchanges between Korean and Mongolian scholars. However, there are obstacles to be solved, such as visa problems, unregistered Mongolian residents in Korea, and a lack of airline availability. Also, by looking at examples of exchanges between Mongolia and Japan provides several implications for promoting exchanges between Korea and Mongolia. Section 3 deals with ways to promote bilateral human exchanges. First of all, measures such as an asymmetrical visa exemption system, the use of work-tourism visas, and an open-sky agreement are proposed as countermeasures against obstacles to human exchanges. Furthermore, to expand and diversify human exchanges between the two countries, the establishment and utilization of human networks and the establishment of a Korean center are comprehensively proposed.
   Chapter 6 deals with cooperation tasks in the Korean-Mongolian language and culture fields. The first section analyzes the cooperation environment between the two countries based on their understanding of Mongolian language and culture. The Mongolian language incorporates the traditional Mongolian nomadic culture, so understanding it will also help the two countries cooperate in the political and economic sectors. The Korean language has a deep linguistic relationship with the Mongolian language, too. The second section analyzes the achievements and problems of bilateral cooperation in language and culture through how Mongolian and Korean studies have been educated and studied in both countries, respectively. Korean is being selected as a major in many Mongolian universities, and Korean language education for the general public is also being activated through the King Sejong Institute. There are two universities in Korea that have established Mongolian programs as a major for their students, and research is also being activated to find the origin of Korean culture in the cultural field. In the third section, measures to promote language and cultural exchanges are discussed, including the establishment of a comprehensive Korean cultural platform, the strengthening of the excellent teacher dispatch system, and the expansion of the Mongolian cultural research support system.
   Chapter 7 presents the conclusion of the study and our suggestions. In Section 1 the main points of the study are summarized, establishing the vision for future cooperation between the two countries. Based on the vision of future cooperation, the second section presents major cooperation tasks and realization measures, such as tasks and measures to revitalize economic cooperation and industrial cooperation, political and diplomatic cooperation tasks and realization measures, and tasks and measures to promote human and cultural exchanges.
 

  This report reviews the preliminary judgments of the CJEU on the interpretation of the EU GDPR and compares them with Korean laws and precedents in order to derive implications related to the validity of passive consent, the basis for the transfer of personal data abroad, and the content and scope of application of the right to be forgotten. The CJEU have ruled that passive consent, such as preselected check boxes, is not a valid agreement. In addition, the ombudsperson mechanism which cannot make any decisions binding on intelligence agencies is not effective judicial redress. That is why the Privacy Shield, which was the basis for the transfer of personal data between the EU and the United States, is invalid. Finally, the deletion from search engines based on the right to be forgotten is restricted to the EU region, not the entire world.
  By comparing those precedents of the CJEU with Korean laws and precedents, the report provides the following implications. First, the passive consent was interpreted as invalid even if it was in accordance with Korean laws. Besides, the precedent is also in the same position, which shows important criterion was whether the data subject could objectively confirm the intention of the data subject. However, since Korean laws are less specific than the EU GDPR, it seemed necessary to supplement them. Second, the transfer of personal data to third countries or international organizations was allowed only when the data subject agreed. Otherwise, the EU GDPR recognized various other reasons besides the consent of the data subject. It is time that the supervisory authorities of Korean law should consider whether to allow other basis for the transfer of personal data or not. Last, there was a ruling that the right to be forgotten has not yet been introduced into Korean law. The right to correct and delete in Korean law is recognized only if the information is incorrect after the exercise of the right to read, and there is a difference from the right to be forgotten. Discussions on whether to introduce the right to be forgotten are needed.