China, which has grown into the world’s second-greatest economic power through a sustained period of rapid growth, has decided to use innovation as its next growth engine, aiming to overcome the limitations of its existing growth model that mainly focuses on export and investment and to strengthen its global competitiveness. In the mid-2000s, China's innovation development strategy, which began with a focus on science and technology development, became more and more important due to changes in external conditions such as the global financial crisis and recession in developed countries. 
  In the nation’s 13th Five-Year Plan announced in 2016, which focuses on an innovation-led development strategy, it is stated that innovation is the core value of China's development strategy. The plan is to establish China as a world-class science and technology powerhouse by 2050 through innovation in the industrial sector, policies, management systems, business models, and culture sector. In other words, the government actively supports promotion factors within the economy by eliminating the obstacles to smooth operation of these mechanisms, ensuring that technological innovation leads to innovation in production technology and economic development through industrialization and commercialization. At present, China is pursuing a detailed innovation policy for each sector and region, in line with a mid- to long-term innovation development strategy as its national strategy. China’s science and technology innovation policy, and its Manufacturing 2025 (manufacturing innovation), Internet Plus (convergence innovation) initiatives, as well as programs to promote popular start-ups, global innovation (entrepreneurial policy) and innovation talent cultivation, are representative sector policies. Chinese regions have established mid- to long-term innovation development strategies that are tailored to the characteristics of local economies, industry, and resources, and are pursuing detailed policies in each sector.
  As China is both Korea’s largest economic partner and increasingly a competitor for Korean businesses as it catches up in its technology level, China’s strategy for innovation development offers Korea increasing opportunities for cooperation to enter new markets. These opportunities also have the double-sided nature of increasing risk by reducing opportunities for entry due to weakened competitiveness. On the other hand, regions with high levels of innovative development such as Beijing, Shanghai, and Shenzhen are relatively transparent in terms of their market environment, systems and procedures, but competition between global-level companies is fierce. In the case of Sichuan and Shaanxi, while these regions have relatively low levels of innovation, it will be necessary to select and concentrate in areas for practical innovation cooperation, when considering the government’s aggressive policies and determination to implement its policies in these regions, which will generate a relatively high entry capacity for Korean businesses through their comparative advantage against local companies. As such, this study selects regions where innovation cooperation with Korea is likely to be developed, and analyzes detailed cooperation fields and plans with the relevant regions in order to enhance the possibility and performance of cooperation in the future-oriented field of innovation. In order to identify promising areas for cooperation, we compare and evaluate the current innovation capacity by region and analyze regional innovation strategies and detailed policies to measure the possibility of future innovation development. In addition, by analyzing the mechanism of this innovation, which is a structural feature of the innovation strategy, we analyze the characteristics of the regional innovation development strategies centered on promising regions, through which we propose appropriate countermeasures by Korea and plans to further cooperation between Korea and China.
   In Chapter 2, we compute the total score of innovation competency for each of the 31 provinces using 24 sets of statistics that represent innovation competency. We compare the total scores for 2011 and 2014, and reflect existing economic relations with Korea into the results by first identifying regions with relatively high possibility of cooperation or possibility between the two countries. In Chapter 3, we use the results of our analysis and evaluation of the innovation policy, which determines the environment for innovation and has a significant influence on future innovation development, and the results of the evaluation of current innovation capacity conducted in Chapter 2, to select promising areas for innovation. In order to conduct policy analysis in a multi-layered and comprehensive way, we analyzed China’s technology innovation policy and industrial innovation policy (Manufacturing 2025, Internet convergence), i.e. the main and detailed policies for managing innovation development in each region. In Chapter 4, we examine the innovation mechanisms in each region by their respective types of innovation development, using the categories of innovation base, innovation actor, and policy improvements made to promote innovation. First, by analyzing the development of innovation resources, innovation and high-tech industries in each region, structural characteristics, and innovation clusters, we identify the characteristics of innovation infrastructure and the characteristics of innovation base. We also look into the actors driving innovation in each region (government, enterprise, university, research institute), and what kind of efforts are being made to strengthen the competency of innovation by region. Finally, we analyze the institutional and policy environment and ways to improve the innovation activities of innovative entities. Chapter 5 summarizes the characteristics of innovation strategies in the major regions of China, together with an analysis of the characteristics identified above, and explores cooperation plans associated with each type of innovation and region.
  Beijing serves as a role model for China’s innovation development, leading innovation in science and technology services, smart manufacturing, and cutting-edge ICT convergence. The fields of artificial intelligence, stem cell research, bio medicine, nanotechnology and environment are particularly promising areas for cooperation with Korea, as well as the various projects for technology application and commercialization centered on the Chung Kun Chun Innovation Center. The enterprises in Jiangsu show strong innovation capability and possess the largest number of innovation platforms. As a result the region focuses on industrial innovation rather than core innovation, and promotes industrial advancement and high added value through fusion mostly within the manufacturing industry. Technology cooperation in information and communication, automobiles, new materials, biopharmaceuticals, smart manufacturing, and the environment can be considered. Private enterprises are the primary actors for core innovation in Zhejiang, with these companies pursuing innovation in Internet convergence centered on Internet-related services, the promotion of small and medium enterprises in the field of science and technology, together with the establishment of a digital economic innovation center, next- generation ICT, industrial robot and smart manufacturing equipment, new materials, new energy, medicine-related convergence services and new industries. Chongqing, which is promoting innovation capacity through the cultivation of knowledge-intensive high-tech industries, is providing financial and financial support for science and technology enterprises and start-ups, increasing the R&D investment of companies and fostering excellent innovation talents in the Internet industry. It should be possible to utilize cooperation opportunities related to science and technology, Internet companies and talent centering on the Liangjiang New Area.
  China is utilizing innovation as a driver for growth, based on comprehensive national innovation policies, high technology demand, abundant financial power, huge domestic market and a stable start-up ecosystem. Therefore, the Korean government needs to improve the efficiency of innovation investment by selecting promising areas for innovative cooperation and concentrating in these areas, and by developing and propagating cooperation models and successful cases of cooperation through intergovernmental cooperation platforms and the protection of intellectual property rights. These efforts will thus reinforce the competitiveness of enterprises in terms of their innovative capabilities, by expanding platforms for innovative cooperation and supporting self-promoting efforts by the businesses themselves, such as through industrial education systems. In addition, it will be necessary to examine whether the government-led innovation model employed by China can play the role of a primer for inducing or expanding the participation of companies in the innovation development of the Korean economy. In order to understand the various innovation- related demands of China, we need to monitor specific policies related to the comprehensive innovation strategy, industries, companies, and institutions. We also need to invest in venture companies or innovative companies, exporters, and so on. In addition, innovation cooperation should reduce their initial risk by participating in cooperation projects based on bilateral cooperation channels between Korea and China. Lastly, it will be necessary to localize innovation through the development and modification of special products and services specialized in the various demands and preferences of innovation within China, thus improving inefficiency in local areas and generating new demand. 

  There has been an increasing trend in services trade due to technological development in ICT, transportation in addition to the international trade liberalization efforts. Although Korea, China and Japan has also experienced an increase in its services trade, the share of trade in services out of GDP remains small compared to that of developed countries. Meanwhile, as the importance of the service industry as a new growth engine is widely recognized in the three countries, each country has been actively implementing policies to promote the service industry, including deregulation and open-door policies utilizing the Special Economic Zones and FTAs. Thus, in this report, we analyze the regulatory factors that restrict the service trade of Korea, China and Japan and derive implications for Korea to enhance competitiveness in services sector by promoting services trade in the three countries.
  First, we examined the recent trend of trade in services in Korea, China and Japan not only in terms of trade value but also in value added using the World Input Output Database. We found that the services sector in value added accounted for nearly 30% of the total manufacturing exports of the three countries. Also the dependence of intra-regional value added services trade showed an increasing trend over the period from 2000 to 2014.
  While there could be multiple factors that contribute to the upward trend of services trade of China, Japan and Korea, regulatory reforms are pointed out to contribute to the increase. Measuring the restrictiveness of services trade with the OECD STRI (Services Trade Restriction Index), all China, Japan and Korea’s STRI exhibited a decreasing trend, indicating that the countries are liberalizing in trade in services. Comparing between the three countries, Japan’s STRI was lower in all 22 services sectors compared to OECD average while 5 sectors for Korea and 20 sectors for China recorded higher STRI than the OECD average. Using the STRI, we further conducted an empirical analysis to investigate how the level of services trade restriction and the difference in services trade regulation affect services trade. The analysis revealed that higher STRI is negatively associated with services trade of Korea and Japan.In addition, Korea’s FTA appears to have a significantly positive effect on service trade while there was no effect on Japan’s possibility due to the fact that Japan’s liberalization policy is on the most favored nation basis while Korea’s liberalization policy depends more on FTA. Also, the empirical result showed that the FTA effect is greater on service trade, the longer the FTA implementation period.
  We also chose four industries for an in-depth study: legal services, accounting services, courier services, and insurance services.First, in the case of the legal services market, Korea and China seemed to be less open than Japan. Japan’s liberalization of its legal services market to foreign lawyers remains a success story unlike the case of Germany, France and so forth where the countries’ domestic law firms gave dominance to English law firms. Thus, while foreign entry in the legal services market may lead to more domestic jobs, it may also accompany side effects requiring a detailed feasibility study before considering additional liberalization.
  The accounting service industry has been pointed out as one of the industries with the most restrictive service regulationin Korea. Such negative evaluation is attributed to Korea’s limited qualification for CPA examination. In order to take the CPA exam in Korea, it is necessary to complete certain credits in accounting courses, but Korea does not recognize the credits earned from foreign universities which contributed greatly to the rise of the sector’s STRI. It seems to be necessary for Korea to reorganize the related system. Meanwhile, Korea, which has concluded an FTA with the United States and the EU, has opened its legal and accounting services market to a large extent. Therefore, the OECD STRI, an index based on the most- favored-nation standard, seems to be undervalued in Korea. For example, under the KORUS FTA, as of 2017, Korea now allows the United States law firms to hire a Korean lawyer and this additional market access is not reflected in the STRI.
  In case of the courier services and insurance services industry, the Chinese market seems to be less open compared to Korea and Japan. Among the five policy areas within the STRI, the restrictions on foreign entry were the main factor contributing to China’s high STRI. Meanwhile, in case of Japan, barriers to competition were the main factor. This implies the importance to create a government level cooperation channel which focuses not only on foreign entry, but also on indirect market restrictions.
  In addition to the aforementioned industries, the report also studied the healthcare industry, an industry which all three countries are focusing on due to the industry’s significant growth potential based on the advanced ICT technology. China seemed to be the most active country to open its market compared to Korea and Japan. For example, China has granted permission to establish hospitals in seven areas including Beijing and the establishment of welfare facilities for the elderly under the China-Australia FTA while Korea and Japan has not made any additional commitments since the Uruguay Round. Meanwhile, the healthcare sector is included in Korea and Japan’s special economic zone plan and the two countries continue to make efforts for further deregulations in the sector.
  Based on the study results and its implications, this report suggests the following recommendations for the Korean government and enterprises. First, while the WTO debate is stalled, a comprehensive and high-level FTA can be the second best policy option to create new market access, generate the momentum for regulatory reforms and enhance regulatory transparency. In 2017, Korea is engaged in Korea-China FTA and RCEP negotiations which Japan and China also participate in, and the Korean government should continue to make efforts for a high-level FTA. In this regard, an in-depth research on the most recent market liberalization discussion within the country and between countries, especially with the advanced countries, is necessary. Second, an official government level cooperation channel is needed to discuss reasons behind the different service sector regulations between the three countries, to discuss possible elimination of discriminatory measures and to promote services sector regulatory harmonization. An in-depth discussion for services market liberalization can be burdensome for the three countries in the short term considering its relatively low sector competitiveness. However, noticing that enhancing the service sector’s competitiveness can also create spillover benefits to the goods sector competitiveness, the three countries can first start a joint study on the effect of services trade on each economy, and this report can serve as the starting point for further research. Third, the Korean government needs to develop a more updated, detailed, systematic information system to support the internationalization of the Korean firms. In particular, a more specific database of foreign companies would be helpful for Korean companies which seek for a potential business partner. Fourth, all three countries are utilizing the special economic zone strategy and Korean government could search for possible cooperation opportunities at the government level and provide relevant information to the Korean companies. 

  This study revisits and investigates the effects of non-tariff measures on trade flows from a theoretical and empirical viewpoint. First, the theoretical framework provided in the paper shows that the changes of trade patterns with regard to introduction of non-tariff measures by the importing country depend on the relative changes of compliance costs between importing and exporting countries. In particular, it is suggested that the introduction of high standards in developed countries may impose higher compliance costs on producers in developing countries than those in developed countries. In such a case, imports of developed countries from developing countries will decrease. The corresponding empirical analysis investigates the effects of non-tariff measures, primarily SPS and TBT, on imports in eight industries – agriculture/fisheries, mining, textile/garments/other, chemical, metal/non-metallic minerals, transport equipment, electronics and machinery, using the UNCTAD non-tariff measures database. The results are as follows. The effect of SPS measures on imports is significantly restrictive in the agriculture/fisheries and textile/garment/other industries. TBT measures are also trade-restrictive in most industries except for electronics. Further analysis to explain why the electronics industry poses such an exception shows that while TBT measures in electronics play a restrictive role in imports of developed countries from developing countries, they perform a promoting role the other way around. Such results are in line with theoretical predictions and imply with caveat that not all non-tariff measures in certain industries serve as barriers. 

  The year 2017 marks the 40th anniversary of diplomatic relations between Korea and Sri Lanka. Located in the Indian Ocean, Sri Lanka is a small island nation with a population of about 20 million. The country has seen high economic growth and poverty reduction since 2009, when the civil war ended after 30 years. Elected in 2015, President Sirisena of Sri Lanka is pursuing national development that focuses on sustainable growth. In this regard, President Sirisena recognizes climate change as a major challenge in the implementation of national development initiatives. In particular, atypical rainfall patterns have intensified over the last three years, causing damage to agricultural productivity, hydro power generation, and water-related health sectors.
  Since the opening of diplomatic relations in 1977, Korea and Sri Lanka have continued active human and material exchanges. Sri Lanka is also one of Korea’s ODA priority partnership countries. Thus, the Korean government has formulated a detailed strategy on cooperation with Sri Lanka. Sri Lanka is one of the top 10 ODA recipients for Korea. Likewise, Korea is the second largest bilateral donor for Sri Lanka. At the summit held in commemoration of the 40th anniversary of relations between the two nations, Korea pledged to expand its bilateral cooperation, in the form of EDCF assistance and grant activities through KOICA, with Sri Lanka by 2019.
  Under such circumstances, this study was conducted to guide further cooperation with Sri Lanka, mitigating the adverse impact of climate change and promoting sustainable development. The study focuses on Sri Lanka’s climate change policies and related needs, as well as its national development priorities. We also conducted a thorough review on major donors’ cooperation activities and policies, including those of Korea. Most importantly, detailed on-site interviews with major stakeholders were carried out. Through in-depth case analyses of major bilateral and multilateral donor organizations, we attempted to seek the policy direction for climate change assistance and formulate a performance management framework for Korea.
  The report is composed of the following chapters: In Chapter 2, we first provide an overview of Sri Lanka's national economic, social, and environment circumstances. We scrutinize recent development plans in Sri Lanka, such as the National Economic Development Plan for Sustainable Era, the Public Investment Plan 2014-2020, and Vision 2025. By reviewing the documents, we sought to observe how climate change is received and integrated into the policies. Our results indicate that Sri Lanka perceives climate change as a cross-sectoral issue. Sri Lankans recognize the adverse impact of climate change and are pursuing countermeasures in various areas.
  Chapter 3 identifies projections and vulnerabilities to climate change in Sri Lanka. We analyzed the climate policies and climate-related needs of Sri Lanka accordingly. Sri Lanka has drafted detailed climate change policy documents to implement the agreements made under the United Nations Framework Convention on Climate Change. Vulnerabilities and areas demanding support were identified through a rich analysis of documents, including national climate change policies, greenhouse gas reduction and adaptation plans, technology needs assessments, and Nationally Determined Contribution (NDC). We were able to conclude that Sri Lanka has a more urgent need to adapt to climate change than to reduce greenhouse gas emissions. The areas significantly impacted were the food sector – including agriculture and fisheries, water resources, health, coastal and marine environment – and biodiversity.
  In Chapter 4, we reviewed the status of international support to Sri Lanka and examined various related issues. The chapter first looks at ODA support to Sri Lanka, including in regards to climate change, through the OECD DAC Rio Markers. In the following section, we analyzed the assistance policies implemented by donors, namely Japan, the United States, Asian Development Bank (ADB), World Bank, and United Nations Development Program (UNDP). All of the donors recognized Sri Lanka as being vulnerable to climate change and identified climate change as a barrier to the country’s development. Furthermore, we observed that climate change is often addressed as a cross-sectoral issue which the donors treated with different weight, measures and strategies.
  Chapter 5 provides an overview of existing bilateral cooperation between Korea and Sri Lanka and examines performance in this area. Korea has identified Sri Lanka as a priority cooperation partner and, therefore, developed a dedicated cooperation strategy. The first and second Country Partnership Strategies (CPS) for Sri Lanka consider climate change as a risk factor. Nevertheless, climate change is supported in an ad hoc basis, without a systematic assistance framework. Consequently, the amount provided to climate-related aid is nominal.
  Building on the lessons gained from the previous chapters, Chapter 6 seeks to lay out a direction for Korea’s future cooperation with Sri Lanka, with emphasis placed on climate change. We also suggest that a proper performance management framework is essential to increase climate-related support to Sri Lanka. The main points of Chapter 6 include the following.
  First, we proposed agriculture, water supply and management, and disaster management as the most significant and prospective sectors for bilateral cooperation. We also suggested to consider a multi-sectoral and integrated approach where projects with a focus on mitigation and adaptation can merge with one another. Potential projects and programs can take the form of partnerships with active bilateral and multilateral donors in Sri Lanka. Such partnerships will facilitate the use of expertise and experience by these donors and also improve the accessibility of significant climate funds, such as the Green Climate Fund.
  Moreover, it will be necessary to establish a performance framework for climate-related aid, learning from the previous and current CPS for Sri Lanka, which lacked specific goals, baselines, targets, and climate consideration. Some donors, namely the United States, identified climate risks from the design-phase, carried out impact assessments, and took appropriate measures, if deemed necessary. In addition, indicators specific to climate change can be produced and utilized to enable effective management of performance.
  In the long-term perspective, Korea should progress toward the mainstreaming of climate change in its international development cooperation. Korea must also establish a system for performance management. Such actions are the starting point for quantitatively increasing climate-related aid to Sri Lanka. More importantly, it is a crucial transition that Korea must achieve in order to enhance the effectiveness of its activities in international development cooperation. 

  With an understanding that economic integration and reunification of North and South Korea should be accompanied by structural reforms of the two Koreas’ industries and industrial development of North Korea, this paper aims at drawing a competitive industrial map of the Korean Peninsula and exploring ways to restore North Korean industries and grow its economy.
  In order to maximize economic integration and economic benefits from unification, reforming disparate industrial structures of North and South Korea is necessary to create a synergy effect. In other words, as their economic power and institutions are different from each other, the two Koreas have to make industrial reforms in a reasonable way to create a favorable environment for unification and develop industries with growth potential in North Korea.
  North Korean industries are expected to face changes from three perspectives. Firstly, with economic sanctions from the international community rising, the North will continue to change its industrial policy depending on 'external factors'. Secondly, North Korea's industrial policy in the future will focus on normalization of leading industries and improvement of internal efficiency. Thirdly, with investments from other countries and Sino-North Korean economic cooperation limited, the North will face a dilemma between its planned economic system and a market-oriented economy.
  To restore North Korean economy and achieve its sustainable development, the following measures are required.

  a. Finding and nurturing industries that will lead economic growth
  b. Coming up with methods to attract investment to expand production and supply capacity
  c. Enhancing growth potential by expanding SOC facilities
  d. Fostering labor intensive industries to strengthen social safety net that lead to both economic growth and enhanced welfare
  e. Developing export and basic industries based on establishment of a special zone or an industrial complex of local specialization
 
  Directions for inter-Korean industrial cooperation and industrial reform in preparation for unification will have to focus on early economic recovery and industrial normalization of North Korea, while focus on strengthening competitiveness of South Korean industry through building a structure of division of labor that can make a win-win situation.
  From a mid and long-term perspective, these should be pursued with consideration of balanced land development of the Korean Peninsula, enhancing regional  cooperation, formation of an economic community and economic integration of North and South Korea. They also have to consider association with establishment of a Northeast Asian economic bloc.
  To this end, the North will have to implement comprehensive and vigorous reforms and make large-scale investments on most industries. It will also have to foster new industries through privatization of state- owned properties, while attract foreign direct investments to nurture new industries, and establish a division of labor system in relation to South Korea’s key industries.
  This paper points to promising industries in North Korea after unification. Firstly, light industry exports like textiles and clothing, ICT manufacturing and service industries, and food processing and daily necessities industries targeting expanded domestic markets will lead growth in North Korea.
  Secondly, the service industry along with the light industry will have to play a leading role in creating jobs in the North shortly after economic integration.
  Thirdly, with demands for construction rising, the construction industry and related industries including construction materials like machinery, cement and plastic products should be nurtured as one of short-term growth industries right after unification.
  Fourthly, the machinery industry will be one of key industries of North Korea for a mid and long term period based on a comprehensive industrial base. Fifthly, the materials industry such as steel and chemical industries have to experience a limited modernization through rapid and powerful reforms on relatively competitive sectors.
  Sixthly, while restructuring and fostering existing industries, industries of new or advanced technologies that have an advantage to enter into the North region have to be developed so that the foundation for North Korea’s mid and long term economic growth can be established. 

Acknowledgements

Notes on the Contributor

The Tourism Industry in Arab Spring: Effects and Perspectives
Chokri MAKHLOUF
Ⅰ. Introduction
Ⅱ. Tunisia and the Impact of the Jasmine Revolution
Ⅲ. Recommendations
Ⅳ. Conclusion

References 

   The disturbance of Arabic countries especially in the MENA region called the “Arab Spring” has had a direct impact on the tourism industry of the Arab region. Volatile events, instabilities, political turmoil and extremism present the tourism industry with significant challenges. But in any event, future developments will depend in any case on the security situation in the country, as tourism is certainly a sector with many advantages in terms of foreign investment and foreign exchange. At the same time, it is a very sensitive sector. The slightest social upheaval, the smallest popular movement, these all have incalculable effects on the sector.
  Tunisia is an excellent example of what can happen to the tourism industry in such cases. This paper explores first the effects that the Arab Spring has had on tourism industry performance. We aim to identify the influence that events of the Arab Spring had on tourism in Middle Eastern and North African States, namely by examining the cases of other countries such as Egypt and Tunisia in comparison with Morocco and the United Arab Emirates.
  Finally, the study examines the policies and strategies adopted by Tunisian governments in order to mitigate the crisis in the evolving tourism sector, and to develop recommendations on how the tourism industry can recover from the Jasmine Revolution.  

  This study focuses on analyzing China, India and Singapore’s driving capability for the 4th industrial revolution (4th IR), related national policies, plans, or strategies, etc. In addition, this study suggests implications and directions for the development of policies related to the 4th IR by the Korean government and the strengthening of cooperation with each of these three countries.
  As expected, in terms of driving capability for the 4th IR, although there is still a significant gap between the U.S. and the three countries above, overall both China and India are in a higher rank in the areas of R&D, innovation cluster, and start-ups, relative to other developed countries except for the U.S. India and China also ranked first and second as the best global R&D investment destinations, while in the first half of 2017, the number of unicorn companies by country was the largest in the order of China, Britain, and India, next to the U.S. Meanwhile, Singapore is ranked the highest for digitalization and flexibility.
  Based on these capabilities, the three countries have been actively preparing for the 4th IR in various ways. First, China’s national policy framework consists of its Manufacture 2025 and Internet Plus strategies, and the promotion of Artificial Intelligence (AI) programs, with a focus not only on promoting investment, but also enhancing firms’ innovation capability by establishing incubating facilities, a credit management system, and improving protection for intellectual property rights. Thanks to this, many Chinese unicorn companies have been born in the fields of finance, O2O, and shared economy services. In addition, innovation cooperation with the U.S., Germany, and Israel has been enhanced, increasing opportunities to utilize developed nations’ advanced technologies and experiences in the areas of smart manufacturing, science and technology.
  Second, India focuses on developing IoT (Internet of Things) technology and related projects as a priority. In particular, NASSCOM, a private IT organization, has established an innovation center called CoE-IoT in cooperation with the Indian government, creating an IoT ecosystem through incubating and accelerating start-ups, supporting technology and human resource development. Additionally to promote an IoT ecosystem in an effective way, the Smart City Project has been under development as a test-bed for IoT technology-based start-ups to test and apply their solutions or services. Meanwhile, Aadhaar, the world’s largest biometric digital authentication platform, is another flagship project for the 4th IR. This platform is already being used in various public and private services in India. India is also making up for its lack of domestic investment by working with multinational companies such as Cisco, Bosch and Intel. In particular, Cisco has developed a Smart City integrated platform called City Digital Platform, developing various solutions in cooperation with major cities such as GIFT City and Jaipur, as well as the City of Telangana state government.
  Finally, Singapore has been pursuing its Smart Nation Initiative since November 2014, in line with the 4th IR. The Smart Nation Initiative aims to make Singapore the world’s first smart country by 2025. The Smart Nation Initiative of Singapore is directly led by the Prime Minister’s Office and is supported by the Smart Nation Platform (SNP), Government Technology Agency (GovTech), National Research Foundation (NRF), among others. In particular, the Singapore government supports the Initiative through a master plan like the Infocomm Media 2025 and Research, Innovation and Enterprise 2020 Plan (RIE 2020 Plan), and has been committed to fostering the world’s best start-up ecosystem. To lead the development of the world’s smart cities, NRF is developing the Virtual Singapore project in joint with the French Dassault Systèmes. Singapore also launched FinTech Bridge with the UK as a part of its efforts to build a Smart Financial Center and a Global FinTech Hub. At the same time Singapore is developing and operating a POLY-GOES-UAS program with German small and medium businesses with the world’s best competitiveness to nurture young talent in advanced technologies and cross-cutting technologies.
  Based on the above, this study suggests the following policy implications. We need to 1) focus on innovation R&D and cluster internationalization, 2) strengthen the R&D base in India, and 3) create and globalize a sustainable innovative start-up ecosystem.
  In addition, this study presents the following cooperation directions and policy tasks in respect to the three countries above. First, we need to enhance selective and strategic cooperation with China in the aspects of competition and response via the following strategies: 1) strengthening R&D projects for original technologies in new technology and industry areas, thus focusing on early commercialization and standardization; 2) developing strategies to actively utilize digitalized consumers in China and protecting domestic digital consumers and cross-border personal information; 3) advancing into the areas of 5G, smart manufacturing and robot-related fields in China; 4) enhancing collaboration in terms of internationalization of innovative entrepreneurial ecosystems; 5) pursuing agreements to address the issues of technology deception and technical protection.
  Second, we need to enhance all-round convergence and win-win cooperation with India through the following channels: 1) early enhancement of core SW technologies such as artificial intelligence, embedded and cloud computing via using India’s excellent SW, IT service capability; 2) taking advantage of India’s Big Data resources, including Adhard, the world’s largest digital personal authentication system; 3) participating in smart manufacturing, digital infrastructure development with new technologies and products related to smart city, cooperation between start-ups in both countries; 4) to do this, we will need to consider utilizing the Vision Group of Korea-India Future Strategy’ and 5) creating a Korea-India Innovation Venture Fund.
  Lastly, with Singapore, we need to strengthen innovation cooperation in policies and systems, education, R&D, and entrepreneurial ecosystems that underpin the 4th IR. To do this, the following tasks will be necessary: 1) benchmarking the Virtual Singapore, Mobility 2030 initiatives, smart home solutions, and health hub programs, which Singapore is developing together with France’s Dassault Systèmes and considering a joint R&D if necessary; 2) exploring active cooperation projects with the Singapore National Research Foundation (NRF), the Science and Technology Research Agency (A* STAR), and 14 test-beds; 3) establishing a partnership channel with BASH, Singapore’s largest innovation entrepreneurial community, and SGInovate, which operates BASH; 4) promoting cooperation between Korean and Singapore Start-Up, which is involved in FinTech and Smart City businesses. 

  E-commerce is the sale or purchase of goods or services over the Internet or computer network. Despite the importance of e-commerce market, existing papers in Korea have only covered with basic analysis including the size and growth of e-commerce market in Korea. We do not know whether e-commerce activity substitutes or complements existing trade in goods, or whether it creates or destroys jobs. More fundamentally, we do not know the differences between e-commerce firms and non-e-commerce ones.
  The first goal of this study is to characterize the e-commerce market in Korea. To show the characteristics of e-commerce market in Korea, we collect the 2010-2016 e-commerce data provided by the Korea Customs, the online shopping trend survey from 2000 to 2016 by the Korea Statistics, and the 2000-2016 reports (including micro-data from 2013 to 2015) from National Information Society Agency, the e-commerce reports and data from 2010 to 2015 by the US Census, and other referenced data in reports including UNCTAD and market agencies. We have carefully summarized and compared the latest trends and features of the e-commerce market in Korea, having the scope of each dataset in mind. We also provides some caveats in interpreting figures in e-commerce import and export data from the Korea Statistics and the Korea Customsin order not to misguide readers in interpreting the different values between them. Many interesting features of the e-commerce market in Korea are included in the study.
  This study aims to characterize global B2C e-commerce by firms in Korea and to examine the impact of e-commerce on international trade. Using export statistics through e-commerce provided by Korea Customs, we reportthe proportion of SMEs engaging in global B2C e-commerce exports is high compared to that in traditional exports in goods. The total volume exported through e-commerce has been rapidly increasing while the price of goods in e-commerce transaction has been decreasing since 2014. Traded goods via e-commerce consist of mainly consumption goods. They are replaced more frequently compared with traditionally traded goods. Next, we examine the relationship between digital intensity and international trade by using, in industry-level, digital intensity as a key independent variable and total export value as a dependent variable (which is decomposed into average export value and number of goods and ICT development index as one of the control variables. We show that the higher the digital intensity, the greater the total export (as well as average export value and number of goods), implying that e-commerce has a positive impact on exports in goods.
  This study also aims to examine the impact of e-commerce on employment by using the Korea Census. We conduct empirical analysis at industry-level and firm-level. At industry-level, we build variables for job creation and destruction of Korea (Davis and Haltiwanger 1992) and digital intensity and do the OLS and Quantile regression. We find no evidence that there is a relationship, on average, between digital intensity and employment growth rate/job creation in manufacturing. This holds true in different quantiles. On the other hand, there is a positive relationship, on average, between digital intensity and employment growth rate/job creation in services industries. Lastly, we find that there is no relationship between digital intensity and job destruction in both manufacturing and services industries.
  At firm-level, we construct a new dataset from the Korea Census by using propensity score matching technique (in which propensity scores are generated by logit model) in order to relieve endogeneity issue arising from e-commerce variable. We find that e-commerce firms have, on average, higher employment as well as total compensation than non-e-commerce ones. However, we also find that labor compensation per capita in e-commerce firms is largely equaled to or lower than that in non-e-commerce ones, which implies that the increase in total labor compensation at e-commerce firms is mainly driven by employment increase. At firm-level, e-commerce activity has a larger positive impact on employment in manufacturing industries but no impact on agriculture, whereas it has a positive impact only on temporary workers in services industries.
  This study provides policy implications for enhancing e-commerce market of Korea as follows: (1) promoting SMEs to engaging global e-commerce export, (2) streamlining customs clearance process for e-commerce, (3) strengthening consumer protection related to e-commerce transaction, (4) international cooperation to enhance global e-commerce, (5) expanding education, vocational training, and retraining programs related to e-commerce, and (6) building comprehensive panel data for e-commerce.
 

  A high number of trade remedy measures can be regarded as a representative of protectionism. Over the last ten years, both developed and developing countries have increased the number of trade remedy measures mainly on products in metal, chemical, rubber, and plastics industries. In particular, the U.S. has targeted steel products exported by Chinese manufacturers since 2010. This particular fact raises serious concerns since many steel products exported by China that the U.S. has targeted in its national market are being overlapped with those exported by Korean manufacturers. Further, due to that the Korean economy has heavily relied on international trade in goods with the rest of the world, firms in various industries, governmental officers, policymakers fear negative trade and welfare effects of increased trade remedy measures by the U.S. and the rest of the world.
  This study aims to investigate the economic impact of trade remedy in a general equilibrium model with world input-output linkage by quantifying the trade and welfare effects from trade remedy measures. Before examining the economic impact of trade remedy, we investigate the impact of anti-dumping initiations on trade cost by focusing on the steel industry for the last five years. We conduct the fixed-effect as well as PPML estimation in a panel dataset constructed with anti-dumping initiation records, HS 6-digit product-level trade data among 15 countries for the last five years, tariff-lines, usual control variables used in gravity model provided by CEPII, and other relevant variables. We find that anti-dumping initiation in previous year has a negative impact on trade volume in current year. This key result provides a rationale of the study assuming that strengthening trade remedy measures increases trade cost.
  The main results of the study can be summarized as follows. First, the increased trade remedy measures in the world over the last decade has reduced the Korea’s welfare by 0.167%. The 0.167% reduction in Korea’s welfare can be decomposed to changes in terms-of-trade and changes in trade volume of Korea. It turns out that the change in the Korea’s welfare is the sum of 0.254% fall in trade volume and 0.087% rise in terms-of-trade. Changes in trade volume of metal and chemical industry contribute the change in total trade volume by 30.2% and 16.2%, respectively, in Korea.
  Second, after examining economic impact of increased trade remedy measures on Korean steel by the U.S. (or China) ex ante, we find that increased trade remedy measures by the U.S. (or China) worsens Korea’s welfare. The decrease in Korea’s welfare is largely attributed to the change in terms-of-trade of Korea, rather than changes in trade volume of Korea. The deterioration of Korea’s terms-of-trade mainly comes from changes of terms-of-trade among Korea, the U.S. and China, rather than the rest of the world (the world minus the three countries). It is interesting to find that, given the degree of intensity of trade remedy measures by the U.S. or China, China exerts much more stronger trade-and-welfare effects on the Korea economy than the U.S.
  Lastly, we quantify the economic impact of the U.S trade remedy measures on goods exported by Korean manufacturers in case of U.S-China trade war where the U.S imposes trade remedy measures heavily on goods exported by Chinese manufacturers and China retaliates to the U.S trade policy. The study finds that there is a possibility that the Korean economy might benefit from the U.S-China trade war if the U.S. has no further import restriction on goods exported by Korean manufacturers. However, if the U.S. takes actions by imposing additional trade remedy measures on goods by Korean exporters, the Korea economy suffers from serious reduction in trade volume and welfare.
  Based on the main results of the study, we provide several policy implications to cope with increased and intensified trade remedy investigation (or measures) around the world at international-level, multi-country-level, government-level, and firm-level. 

  The aim of the research is to suggest policy implications and proposals to expand bilateral industrial cooperation between Korea and Iran focusing on the petrochemical and automobile sectors that occupy the largest share of the Iranian manufacturing industry.
  Chapter 2 touches upon the political and economic trends, international relations, and economic policies in Iran in order to understand the recent changes in both economic and political spheres of the country, analyzing Korea-Iran economic relations. Contrary to expectations for a rapid economic recovery after lifting the international sanctions against Iran in January 2016, foreign direct investment inflows to the country have continued to remain sluggish and the unemployment rate has remained high. A ban on Iranian access to U.S. dollar transactions as prescribed under the primary sanction and the worsening relationship between the U.S. and Iran after President Donald Trump came into office have become key factors which undermine investors’ confidence. On top of this, the stability of Iran’s macro-economic conditions is recently being threatened mainly by the high inflation rate and steady rial depreciation. Upon this backdrop, economic relations between Korea and Iran have greatly expanded, mainly in the trade and construction sectors.
  Chapters 3 and 4 deal with the policies, structure, characteristics of Iranian petrochemical and automotive industries. Iran’s NPC (National Petrochemical Company) performs the pivotal role of producing petrochemical products as well as regulating the petrochemical market. Iran’s petrochemical complexes are mainly being developed in special economic zones at Mahshahr and Assaluyeh with 58 petrochemical complexes under construction that are expected to produce 134.4 million tons of petrochemicals per annum. The Iranian government has designated the petrochemical sector as a strategic industry through its fifth and sixth 5-year development plans and is pushing for policies such as privatization, expansion of production facilities. The Iranian government also provides cheaper feedstock, tax exemption and deregulation on petrochemical companies in special zones in order to induce foreign direct investment in the petrochemical sector. After the economic sanctions against Iran were lifted, French and German companies showed strong commitment to invest in the Iranian petrochemical sector, reflecting high expectations for Tehran’s development policy and high growth potential. However, due to the uncertainty in international relations surrounding Iran and difficulties in financing, global companies’ willingness to invest in Iran has weakened.
  Following the lifting of sanctions against Iran, the largest auto-producing country in the Middle East, car production has been recovering since 2013. The Iranian government is actively moving to foster its automotive industry, focusing on inducing foreign direct investment and promoting transfer of technology with high tariffs on imported cars. Iran is trying to become an automobile manufacturer with advanced technological foundation rather than a CKD (completely knocked down) assembler. With the rise of Chinese companies and re-entry of French and other European firms in the Iranian auto market, competition in the market is expected to be intensified. In addition, there are interior and exterior risk factors such as the existence of the primary sanction imposed by the U.S., and the volatility of Iran’s regulatory policies.
  Chapter 5 presents specific cooperative projects by comprehensively assessing the industrial environment of the petrochemical and automotive sectors. Given the risks stemming from uncertainty in U.S.-Iran relations, bilateral cooperation should be approached strategically in division of the short-term and the long-term. This study presents specific measures focusing on collaborative projects that could be implemented in the short term. In the petrochemical sector, first of all, advisory service projects to transfer the production system of high-value-added petrochemicals could be explored. Second, Korean companies could be an operations and maintenance service provider in the Iranian petrochemical sector, participating in petrochemical plant construction projects initiated by Korean construction companies. Third, exchange program of engineers and experts in both countries’ petrochemical sectors could contribute mutual understanding of bilateral industrial cooperation and future joint ventures in the sector.   The projects could be carried out more effectively through high-level government cooperation between the two countries.
  In the automotive sector, it is necessary to focus on high-tech components and automotive software development rather than large-scale investment projects as cooperative projects that could be implemented in the short term. Given negative impacts that could be imposed on large scale projects due to uncertainty of U.S.-Iran relations, small and medium-sized enterprises could participate in those projects. Second, a technical advisory program utilizing retired but experienced Korean engineers could be considered as a tool for technology transfer. Such an exchange program could benefit both countries, as Korea can create jobs for retired engineers and Iran could improve its technological knowhow and cultivate skilled manpower. Third, considering the uncertainties in the Iranian market, an intergovernmental channel for enterprise support could be established to find solutions to corporate disputes in joint projects. Fourth, the Korean and Iranian governments could promote cooperation for transfer of Korea’s standardization systems to Iran that could be beneficial to bilateral cooperation in terms of technology transfer and job training.