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Appendix 

The year 2017 was a period of escalating external risks for the Korean economy, as advanced economies progressively normalized their monetary policies, the international trend of economic protectionism and nationalistic trade policies continued with the progress of Brexit and the Trump administration’s America First policies, and the North Korean nuclear issue deteriorated into a state of discord among the international parties involved.

To cope with these challenges, we at the Korea Institute for International Economic Policy (KIEP) identified eight major policy directions to focus on as we carry out our fundamental mission as a national research institute. The eight areas KIEP will focus its research capabilities on are: the proposal of coping measures in the face of trade protectionism; promoting strategic economic cooperation; the establishment of a Northeast Asia Plus Community of Responsibility; stronger development cooperation to maximize national interests; pursuing economic unification on the Korean Peninsula; the realization of income-led growth policies; the vision of Innovative Growth; and external risk management.

The global economy continues on the path of recovery from the past crisis, but as of yet we lack clear indications that this trend of growth will continue in the long term. The support of neighboring countries will be essential when it comes to the stable establishment of lasting peaceful relations between the two Koreas. As such, the geopolitical significance of Korea will continue to rise.

As our economy navigates these multiple challenges, KIEP will contribute to the establishment of sustainable cooperation strategies through research on the government’s New Southern Policy and New Northern Policy; we will guide the national execution of the New Economic Map of the Korean Peninsula, based on reconciliation and cooperation between the two Koreas; we will explore international economic and trade policies that can support the vision of inclusive growth; and we will identify promising new industries to concentrate our national resources in line with the Fourth Industrial Revolution unfolding around us. The research findings we provide will serve as a guide to formulate policy decisions that can drive national development.

On behalf of KIEP, I wish to extend my deep gratitude and appreciation for the interest and support you lend toward our progress. KIEP will continue its work in the areas of regional studies, trade investment, and international macrofinance, earning the trust of the people as we fulfill our mission as a responsible research institute and a national leader of sustainable growth and innovation through policy research. 

  This paper examines the current situation of the US-China current account imbalances and the development of trade disputes. This paper also empirically analyzes the short and long-term causal relationship between current account imbalances and real exchange rates and the relationship between the current account persistence and exchange rate regime.
  In Chapter two, we study the current account imbalance between China and the U.S. in terms of trade structure. We find that China’s trade surplus with the U.S. is concentrated in a few specific items, including cell phones, automatic data processing machine and monitors and projectors. Looking at the processing stage of the trade between China and the US, China’s trade surplus with the U.S. has mostly come from the final goods. In particular, the surplus in capital goods trade has begun to surpass the surplus in consumer goods trade, in 2016. We also find that the surplus in high-technology manufacture exceeds that in low-technology manufacture. Meanwhile, China has run a deficit in the service trade with the U.S. and the deficit has surged since the global financial crisis.
  In Chapter three, we examine the development process of the dispute over the yuan exchange rate and the trade disputes after the Trump administration. Analyzing the existing research results on the misalignment of RMB exchange rate, we find that it is difficult to make a consistent conclusion according to the methodology and analysis period. However, the U.S. Treasury Department maintains its position that the RBM should be appreciated to resolve the trade imbalance. After the launch of the Trump Administration, the government is taking hard-line trade sanctions in addition to exchange rate pressures. In 2017, the Trump Administration increased the number of anti-dumping and countervailing duty investigations for import goods from China by 59% year-on-year, and the US Department of Commerce, for the first time in 26 years, exercised anti-dumping and countervailing duties investigation on Chinese aluminum alloy sheets. In addition, it is considering imposing tariffs based on Articles 201, 232 and 301. In response to these U.S. sanctions, China expressed its strong condemnation through government statements and countered in the same way as the United States.
  In Chapter four, we examined the relationship between the current account balance and the exchange rate in two ways. First, we analyzed whether the RBM exchange rates is a significant factor in determining the current account balance between China and the U.S.. In the long term, China’s US current account is affected not only by the real exchange rate but also by the difference in the real GDP growth rate, the difference in the financial account balance of two countries, the financial deeping of China. In the short term, only changes in trade openness have a significant positive effect on the current account. The change of the real exchange rate does not seem to lead to the short-term adjustment of the current account. Second, we study the relationship between the persistence of the current account and the Chinese exchange rate regime. The results implies that current account imbalance between the two countries is adjusted faster after the global financial crisis and China’s exchange rate system reforms contributed to current account adjustment.
  The empirical results provide that the RMB exchange rate only affects trade balance between China and U.S. in the long term, and China seems to contribute to the adjustment of trade imbalance through the exchange rate system reform. However, considering the global value chain of China and emerging Asian economies, it is unclear whether the RMB exchange rate adjustment alone will resolve the trade imbalance. Instead, structural rebalancing such as the U.S. fiscal deficit reduction, the increase of private savings, and the development of financial market in China can fundamentally solve current account imbalance. Although the Trump Administration has not yet designated as a currency manipulator, the U.S. government still suspects the foreign exchange market intervention and the undervaluation of the RMB. It is possible that the pressure of the U.S. on RMB appreciation would direct at KRW exchange rate. On the other hand, considering the dependence of intermediate goods trade between China and Korea, deepening trade disputes between China and the U.S. may cause China to shrink its exports to the U.S., resulting in a slowdown in Korea’s intermediate exports to China. In addition, with the spread of protectionism, there will be a possibility of trade disputes including the subsidy problem between Korea and China due to Korea’s continuous surplus with China. 

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Executive Summary

1. Introduction

2. Literature Review

3. Empirical Analysis
3-1. Variables and Data
3-2. Empirical Specification
3-3. Empirical Results
3-4. Robustness Tests

4. Theoretical Implications

5. Conclusions

References 

  Benefits of financial market integration include cheaper and alternative op-tions of saving and borrowing for households and entrepreneurs. In the global financial market, asset choices for households widen so that individu-als can manage their idiosyncratic income risk more effectively. On the other hand, financial market integration makes investors who hold foreign assets more vulnerable to global financial shocks. In the recent financial crisis, finan-cial market distress which initially arose in the U.S. had an enormous impact on the peripheral countries. This example shows that the strong shock prop-agation occurs via integrated financial markets.
  The existing literature shows that financial market integration has a sizable impact not only on business cycles in the short run, but also on economic growth in the long run. However, there has been little attention to income distribution, specifically in related to the financial market integration. In this paper, we fill the void in the literature by focusing on the following two styl-ized facts: income inequality has been exacerbated in most countries over the past two decades, and the financial market has been integrated across coun-tries during the same period. In particular, we answer three research questions to investigate the relationship between the two facts. First, how does financial market integration affect income inequality? Second, how do financial market integration and financial market development interact to change income ine-quality? Third, what components do theoretical model need to explain the interaction effect of financial market development and integration on income inequality?
  We test hypotheses that the effect of financial market openness on inequality is conditional on the level of domestic financial market development when the financial market opens. An empirical study with panel data comprised of 174 countries for the period 1995-2017 finds that the overall effect of finan-cial integration on income inequality is nonlinear. Financial market integration creates the intensive and extensive margins of credit supply which may de-pend on the development level of financial market disproportionally. This paper uncovers a novel empirical evidence that financial market integration and financial market development interact to change income inequality. When other things are controlled, the effect of financial market integration on in-come inequality depends on financial market development. In a country with underdeveloped financial market, income inequality gets worse as financial market opens. On the other hand, when financial market is highly developed, the effect of financial market openness on income inequality is mostly insig-nificant in a statistical sense. The results are still valid with different measures of financial market development, integration, and income inequality. We check that the results are robust as an endogeneity issue among financial market development and integration is controlled.
  We also suggest some important structures for the conventional economic model to account for our empirical finding as theoretical implications. Based on these implications, extensions of the conventional small open economy model with financial constraints having suggested components such as het-erogeneous holdings of foreign assets across income and asset levels and entrepreneurial shocks will be necessary to understand an interaction of fi-nancial market openness and domestic market development on the distribu-tion of income in a country. Our finding also echoes that studying an eco-nomic mechanism in which economic growth, financial market outcomes, and inequality are endogenously determined.

Keywords: Financial market development, Financial market integration, In-come inequality
JEL Classification: D63, F36, O11, O16 

  This study examines the experience of transition countries when joining the WTO and suggests implications for the North Korean economy and the economic integration of the two Koreas. The situation on the Korean Peninsula is changing drastically due to the recent inter-Korean summit and the first ever North Korea-United States summit following the disintegration of Korea into two countries 70 years ago. If discussions on the denuclearization of North Korea and an enduring peaceful settlement can be completed to some extent, further discussions on the issue of North Korea’s economic integration into the international market will hopefully follow. Though the incorporation of North Korea into the world trade system is an inevitable development in the process of economic reform and opening up and normalization of foreign relations, there is still little debate on this topic. This study examines the issues that may arise in the process of North Korea’s WTO entry through a review of experiences in transition economies.
  The goals of reforming and opening the North Korean economy should be separated when discussing the economic development in North Korea. Up to now, however, the dialogue has focused on economic reform in North Korea while the issue of opening the North Korea economy has not received sufficient attention. In particular, there has been little research on North Korea’s accession to the WTO. This study addresses this gap in previous research by analyzing the implications of the economic integration of North Korea into international trade through a comparison with the cases of various transition countries and in particular the major issues arising during their accession to the WTO.
  In Chapter 2, the study reviews the economic situation of major transition countries before and after joining WTO. At the time of joining the WTO, these nations suffered from various problems in their domestic economies including low GDP, chronic trade deficit (excluding Russia), and severe inflation. The economic downturn and widening gap between formal and informal trade also weakened the control these countries had over their respective economies. Following the collapse of the Soviet Union in 1991 it became inevitable to normalize foreign relations with market economies, causing the transition countries to reform their domestic economy, improve relations with market economies, expand their markets, and introduce advanced capital and technology. This in turn led to the WTO accession of these countries in an effort to dramatically expand their foreign trade.
  Chapter 3 reviews the major issues for transition economies when joining the WTO. Accession to the WTO ultimately depends on negotiations between the applicant nation and existing WTO members. The prolonged cases of WTO accession negotiations by major transition countries can be attributed to the following reasons: (1) efforts to keep new members in check, (2) the issue of recognizing developing country status, (3) debates on whether the WTO Agreement is compatible with domestic economic and/or trade policies, (4) issues related to non-market economy status and trade normalization, (5) political elements and (6) a lack of negotiation experts. Similar problems may appear as major issues in the process of North Korea’s incorporation into the WTO system. Nevertheless, in some cases the countries have improved access to the international market after joining the WTO and succeeded in attracting foreign capital. On the other hand, however, there are cases where trading company have been overly dependent on foreign capital, like Vietnam. Also there are cases, such as China, which is exposed to trade disputes due to non-market Economy status. Those issues may lead to trade disputes and should be considered prior to and after joining the WTO.
  Chapter 4 examines the implications of the transition countries’ experiences for North Korea and the necessity to discuss its accession to the WTO at this moment. WTO accession is the final stage of transition into a market economy system, as it requires not only trade system reform but also economic reform as a whole. For this reason, it is necessary to carefully consider the appropriate timing of North Korea’s accession to the WTO. A radical and dramatic transition of the economic system would require North Korea to bear the burden of huge social costs and losses from administrative disruption. The public opposition arising during this process could create a social atmosphere against reform and opening. Therefore, the policy requires a grace period of time and system implementation that is socially acceptable. Meanwhile, major countries may be more interested in the prospect of economic cooperation between the two Koreas following North Korea’s WTO entry. Therefore it is important to find a balance between economic integration and segregation between the two Koreas.
  This study is significant in that it is the first study to discuss North Korea’s incorporation into the WTO system. In addition, it contributes to government policies and academic studies as the first study to identify the link between the entire economy of the Korean Peninsula and North Korea’s accession to the WTO, while also providing concrete scenarios. North Korea’s integration into the international trade system should not be pursued as a short-term task but rather as a momentous goal which must be pursued with a national vision. Therefore, further studies must be conducted from a long-term perspective.
  The results of this study could be used as a basis for reviewing various factors that should be taken into consideration in the reestablishment of inter-Korean relations. They could also be used as a reference to resolve conflicts with international trade law arising in the process of conducting inter-Korean trade. Ultimately, the study can be used as a reference for when North Korea begins preparation to join the WTO. 

Real estate prices, which plummeted shortly after the global financial crisis in 2008, have risen sharply to exceed pre-crisis levels, raising concerns about global real estate bubbles. In response, this study diagnoses the bubble risk in the global real estate market and analyzes the impact of real estate bubbles on financial crises and the real economy. In addition, we examine previous bubble-oriented financial crises in the real estate sector and compare them against recent global situations.
This study first examines whether a real estate bubble exists in major global economies, based on two criteria. The first is general indicators such as price to rent ratio (PRR), price to income ratio (PIR), and household credit growth rates, and the other is cointegration tests between real estate prices and fundamentals, and time series analyses like the generalized sup ADF (GSADF) method used by Phillips, Wu, and Yu (2011), and Phillips, Shi, and Yu (2015).

The results of the empirical analysis indicate that among the countries where housing prices rose by more than 6.6% in 2016, or those in which housing prices continuously rose by more than 3.6% in the three years from 2014 to 2016, countries with high probability of bubbles forming in their real estate markets are China, Colombia, Hungary, Latvia, Turkey and Slovakia.
Among developed countries, Australia, Austria, Canada, Ireland, Israel, Luxembourg, New Zealand and Sweden have the highest increase rate in housing prices. Among these, Australia, Canada, New Zealand, Israel and Sweden are all at high risk according to the above three indicators. These five countries, for which all three indicators indicate risk, also show the same high bubble risk in our empirical analysis.
In Korea, the housing price index, PRR and PIR have stabilized considerably since the 2000s, and the risk of bubbles forming is also low according to the empirical analysis. However, in 2016 the household-credit-to-GDP ratio in Korea increased by 4.7%p from 2015, showing a remarkable increase similar to China (5.6%p) and Norway (6.2%p). In terms of PIR, Seoul is lower than Hong Kong, Beijing, Shanghai, Sydney and Vancouver, but higher than Los Angeles, London, New York, Tokyo and Singapore. In other words, the risk of real estate bubbles is not high at the national level, but the PIR in some areas such as Seoul is high.
Next, this study uses country panel data to analyze the relationship between the real estate bubble and financial crises. A panel logit with fixed effect model is used to perform the analysis. And the impact of the real estate bubble on GDP growth rate is analyzed using a fixed effect panel model.
The first empirical result shows that the house price bubble (HPB) is highly related to financial crises, as defined by the Jordà- Schularick-Taylor Macrohistory Database. Both HPB and HPB indicators, and the cross term between the two variables, are statistically significant as positive coefficients. At the HPB level, which is about one to two standard deviations above the HPB average, an increase in one unit HPB increases the likelihood of a financial crisis from 3.6% to 4.0%. In Korea, the possibility of a financial crisis is not high because HPB is not far from the long-term trend as of 2016.
Second, our analysis of the relationship between HPB and various types of financial crises, as classified by Reinhart & Rogoff, shows that HPB is more closely related to banking crises and stock market crashes than to currency crashes, sovereign defaults, and inflation crises.
Third, in the fixed effect panel analysis of the relationship between HPB and GDP growth rate, the increase in HPB shows a negative effect on GDP growth rate.
In order to assess the risks of the global real estate market and to obtain policy implications for real estate risk management in Korea, this study also examines the cases of real estate bubble-oriented financial crises such as seen by Sweden, Finland and Japan in the early 1990s and the global financial crisis in 2008. In addition, the risks associated with prospective bubbles in the recent Chinese real estate market have been frequently cited, so we compare the recent Chinese situation with Japan in the mid-1980s and the U.S. real estate bubble in the mid-2000s.
The results of the case analysis indicate a definite risk of a global real estate bubble, albeit to a lesser extent than seen in the past. This is because the monetary easing policies of major advanced economies are far more aggressive than the past. In recent years, however, the strengthening of financial institutions' soundness regulations and risk management, and the implementation of measures to manage capital flows have played a stronger role in mitigating the bubble risk compared to past times.
By region, the real estate bubble pressure seems to be larger in emerging economies than in advanced economies. This is because emerging economies are climbing more steeply than developed countries. In advanced economies, real estate prices have fallen sharply and debt deleveraging has proceeded since the global financial crisis. However, in emerging economies, asset prices have risen and household debt has increased steadily.
In particular, in the case of China, the possibility of a financial crisis due to a plunge in real estate prices is low in the short term. However, Chinese real estate prices are likely to decline modestly, which can slow China's economic growth, and small and medium- sized cities with an over-supply of housing are likely to face a financial crisis.
Finally, this study provides some policy implications for the management of external risks from overseas real estate bubbles and stabilization of the Korean real estate market. In order to improve external risk management, it will be necessary to strengthen monitoring of external environments and global real estate markets, and to prepare countermeasures against financial crisis in economies with high risk in their real estate sectors. It will also be necessary to strengthen international cooperation so that major advanced countries can implement monetary policy normalization measures in an orderly manner.
In order to stabilize Korea's real estate market, it will be necessary to systematically check the bubble risk within the domestic real estate market, and monetary authorities need to consider asset prices in addition to inflation when determining monetary policy. Next, while referring to cases of policies implemented in times of soaring real estate prices, it will be necessary to implement comprehensive measures to suppress demand, expand supply, and manage risk.

  Australia and New Zealand are classified as developed countries, but hitherto they have not been among the primary concerns of the Korean economy, due to their small populations, and the high logistics costs resulting from their isolated geographic location. When considering the areas of politics, diplomacy, and value chains in the Asia-Pacific region, however, Australia and New Zealand are countries that deserve great notice. Australia and New Zealand support the rules-based international order and multilateral trading system, and are key participants in the CPTPP and RCEP. They are among the most important countries that will influence the shape of the regional order. Australia and New Zealand also share a complementary industrial structure with Korea, which can provide mutual benefits through long-term economic cooperations. Therefore, this study examines the economic and strategic importance of Australia and New Zealand, and investigates ways for Korea to strengthen its ties with Australia and New Zealand.
  In Chapter 2, we overview the economies of Australia and New Zealand. In Chapter 3, we conduct a GVC analysis to identify the production networks in which Australia and New Zealand are involved, and then examine the foreign policies of Australia and New Zealand toward ASEAN, China, and Japan. The analysis of the forward and backward linkages shows that Australia and New Zealand depend on Europe and the United States’ value-added in their production process, while products produced in Australia and New Zealand are mainly used in the production process of Asia. According to the GVC analysis, the production network among Australia and ASEAN+3 countries—ASEAN, China, Japan, and Korea―has been developed in recent years, with Australia located at the higher end of the value chain as the main intermediate goods supplier. 

  Based on the contents of Chapter 3, we can see that Australia and New Zealand have tried to integrate into the East Asian economies by expanding their diplomatic and economic relations with ASEAN+3 countries. Australia and New Zealand have sought to access the East Asian economy by signing FTAs with ASEAN+3 countries, and they have also sought to promote cooperation with the countries through their participation in regional forums such as APEC or the East Asia Summit (EAS). As a result of those efforts, Australia and New Zealand appear to have incorporated themselves into the East Asian economy.
  In Chapter 4, we focus on Australia and New Zealand’s trade and investment relationships with Korea, and then summarize the contents of the Korea-Australia FTA and New Zealand-Korea FTA. In terms of value-added, Australia contributes to the production of Korea and plays an important role in the production of Korean exports. On the other hand, Korea’s value-added contributions to the Australia and New Zealand are relatively low, since the manufacturing industries of these countries are not developed. In the primary, construction, business and personal service sectors, however, there is room for Korea to increase its value-added contribution to Australia and New Zealand. Therefore, we should make an effort to expand cooperation in those sectors. 

  Based on the analysis of Australia and New Zealand’s ties with Asia, especially with Korea, Chapter 5 explores ways to strengthen cooperation between Korea-Australia and Korea-New Zealand in the fields of goods, services and investment, agriculture, finance, and diplomacy. As presented in the report, Korea should make a strategic effort to expand cooperation in these sectors by reducing non-tariff barriers, promoting technological cooperation and joint R&D, supporting logistics and distribution, and supporting service trade and investment. 

Executive Summary

1. Introduction

2. National Competitiveness Framework
2-1. Global Competitiveness Index
2-2. Stages of Development

3. Vietnam’s National Competitiveness in the Global and Regional Context
3-1. Background: Vietnam’s Rising Economy
3-2. Vietnam’s Competitiveness in the World
3-2-1. Vietnam’s GCI Score and Ranking
3-2-2. Ranking of the GCI’s Pillars
3-3. Vietnam’s Competitiveness in ASEAN
3-4. Vietnam’s Stage of Development
3-5. Limitation of WEF’s Approach

4. Causes of Vietnam’s Low Competitiveness
4-1. Factor-Driven Growth Model
4-1-1. Leading Role of Input Factors, Minor Role of TFP
4-1-2. Slow TFP Improvement
4-2. Structural Problems
4-2-1. Domination of Low Value-added Sectors
4-2-2. Exports: High Value but Low Value-added
4-2-3. Domination of FDI in Industrial and Export Sector
4-2-4. Low Investment Efficiency
4-2-5. SOEs’ Growing Size but Poor Performance
4-3. Expansionary Policies to Aid Growth
4-3-1. Expansionary Fiscal Policy to Boost Investment
4-3-2. Easy Monetary Policy to Expand Money Supply and Credit
4-4. Slowly Improved Business Environment
4-5. Low R&D Expenditure
4-6. Higher Education: Fast Rising but Poor Quality
4-7. Under-developed Infrastructure

5. Implications for Vietnam
5-1. Low Productivity
5-1-1. Low Labor Producivity
5-1-2. Slow Rate of Productivity Growth
5-2. Diminishing Growth
5-3. Middle Income Trap
5-4. Macroeconomic Instability
5-4-1. High Growth Accompanied with Macroeconomic Imbalances in 2000-2010
5-4-2. Macroeconomic Stabilization at Reduced Growth in 2011-2017
5-5. Low Business Competitiveness
5-5-1. High Business Costs
5-5-2. Limited Labor and Capital Size
5-5-3. Falling Efficiency
5-6. Low Technology Level
5-7. Low Human Capital Quality
5-8. Environmental Degradation

6. Policy Recommendations
6-1. Central Task: Structural Reforms to Change Growth Model
6-2. Raise Technology Level
6-3. Enhance Human Capital Quality
6-4. Improve Business Environment
6-5. Ensure Macroeconomic Stability
6-6. Upgrade Infrastructure
6-7. Learn from the Experience of Advanced Economies
6-7-1. Competitiveness and Stage of Development: Korea versus Vietnam
6-7-2. Favorable Conditions for Vietnam to Learn from Korea’s Experience
6-7-3. Proposed Areas for Vietnam’s learning from Korea’s experience

7. Conclusion

References 

   The WEF’s annual assessment using the GCI index in 2006-2017 shows that Vietnam’s national competitiveness has been low. Globally, Vietnam has ranked in the middle of economies surveyed. Regionally, Vietnam has been in the middle of ASEAN countries. With regard to the level of development, before 2015 Vietnam was in stage 1 (factor-driven), together with Cambodia, Laos and Myanmar. Since 2015 Vietnam has shifted toward a transition to stage 2 (efficiency-driven), which also includes Brunei and the Philippines. The country, however, has lagged behind Indonesia and Thailand (in stage 2), Malaysia (in transition to stage 3) and Singapore (in stage 3, innovation-driven).
  To complement the WEF’s assessment, this study provides an in-depth anal-ysis of main causes of Vietnam’s low competitiveness from the country’s perspective. These are structural problems due to its factor-based growth model, expansionary policies to aid growth, slowly improved business envi-ronment, low R&D expenditure, poorly performing higher education and under-developed infrastructure.
Further, the research examines implications of these shortcomings for Vi-etnam. These are low productivity, diminishing GDP growth, middle income trap, macroeconomic instability, low business competitiveness, low technolo-gy level, low human capital quality and environmental degradation.
  Based on the analysis of the shortcomings and their consequences, policy measures are proposed to improve Vietnam’s competitiveness. Major sugges-tions include structural reforms to change the growth model from factor-based to productivity-based, raising technology level and enhancing human capital quality, improving the business environment, ensuring macroeconomic stability, upgrading infrastructure and learning from advanced economies.

Keywords: Vietnam, Competitiveness, Productivity, Growth model.
JEL Classification: D24, E24, E52, E62, N15, O47, O53, O57. 

  The aim of this research is to suggest a more effective direction for Korea’s gender ODA projects through an analysis of gender-related development cooperation efforts in Cambodia. Based on the Korea- Cambodia Country Partnership Strategy and Cambodia's National Strategic Development Plan, we selected four areas (TVET, rural development, health and public administration) to analyze gender projects in related fields and suggest future directions. 

  The second chapter discusses how a twin-track approach, or a dual strategy of mainstreaming and targeting gender equality, is widely recognized in the international development field. Among the donors in Cambodia, we conduct an overview of the gender strategies and projects of Australia and Japan. We also examine KOICA's gender equality strategy and projects. Finally, Cambodia's gender needs are analyzed through its gender strategic plan, the Fourth Neary Rattanak and Cambodia’s gender ODA statistics.
  The four areas are grouped according to the strategic framework of the Fourth Neary Rattanak, which focuses on women’s economic empowerment and access to social services and projection. In chapter three, gender projects in TVET and rural development, categorized as the 'women’s economic empowerment' framework, are analyzed. Suggestions for future directions are also introduced. The fourth chapter presents projects and future directions in the areas of health and public administration, categorized as the ‘access to social services and protection’ framework. 

  A dual strategy of mainstreaming and targeting gender equality is a common approach recognized by international agencies and OECD DAC member countries. Korea’s gender ODA, on the other hand, comprises 10% of the total ODA amount. With a limited budget, there have not been many opportunities to implement a wide variety of gender projects. Some women-targeted empowerment projects were found in TVET and rural development, but most of them were gender mainstreaming projects in practice. However, gender mainstreaming projects were in fact projects that merely included women among the target group. Other than counting the number of women participants, it was difficult to find other indicators of gender equality. So we suggested factors that are required if a certain project is to be qualified as a ‘gender equality project.’ Suggestions for gender projects geared to the situations and needs in Cambodia are also presented. 

  In the fifth chapter we summarize the findings of the research and derive policy implications. The policy implications are focused not only on improving gender projects in Cambodia, but also on effectively mainstreaming gender in Korea’s ODA in general. First, the dual strategy of mainstreaming and targeting gender equality is a universal approach in the international community which Korea should also consider implementing. Secondly, it should be recognized that since gender projects require changing perspectives and behaviors, it takes time to reap the fruits. From this view, there needs to be a social consensus on the importance of long-term projects over short-term ones. Thirdly, gender indicators should be included from the first stage of project cycles through a PCP format. Fourthly, practitioners, mid- and high-level officials need to increase their awareness of the need for gender ODA. Finally, to promote the success of gender ODA projects in Cambodia, it is recommended that the projects include the Cambodian Ministry of Women’s Affairs as an implementing partner and adopt a programme-based approach (PBA) in their implementation.