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Taiwanese Investment in China: Its Trends and Impact
This report estimates that although China and Taiwan are still on shaky political ground, economic exchange between two nations has grown swiftly since 1980. The trade inter-dependency of the two nations has been accomplished thro..
Si-Joong Kim Date 1993.12.30
Overseas direct investmentDownloadContentSummaryThis report estimates that although China and Taiwan are still on shaky political ground, economic exchange between two nations has grown swiftly since 1980. The trade inter-dependency of the two nations has been accomplished through the Taiwan Strait, indirect trade, and trade through a variety of channels, reaching more than $100 billion. Moreover, FDI in China is the second largest foreign investment nations.
This report implies that Taiwanese investment in China will be an important part of economic integration. There are several characteristics related to Chinese and Taiwanese economic exchange. First, since China and Taiwan are divided, as are North and South Korea, their economic exchange and cooperation could help the two Korea pursue economic cooperation. Second, Korea can learn from the policy implication offered by ripple effects in the process of Taiwanese investment in China. Third, by analyzing the features and trends in Taiwanese business investment in China, Korean companies can find several implications concerning investment toward China. -
Studies on the Service Industry's Internationalization Strategy: Engineering Services
Korea's engineering services industry has grown following the industrialization of its economic structure. The engineering services industry, a representative technology-intensive industry, is in charge of mediating between scienc..
Chan Hyun Shon Date 1993.12.30
Economic development, Economic cooperationDownloadContentSummaryKorea's engineering services industry has grown following the industrialization of its economic structure.
The engineering services industry, a representative technology-intensive industry, is in charge of mediating between science and industry. In addition, the engineering services industry is closely linked the manufacturing industry, the construction industry, the academic world, research institutes and companies.
Therefore, the engineering services industry has become an element of production facilities and plays a determinant role in manufacturing productivity. For this reason, it is often called the 'engine of growth' for the service sector.
Recently, the engineering services industry has been in transition from plant engineering to up-to-date technology-intensive sectors such as new material, mechatronics, bionics, factory automation, new energy, information and technology, and environmental engineering.
This report recommends that with its high quality human resources, Korea should foster the engineering service industry as a central business to take appropriate measures for the transition into a highly developed country. -
The Role of German Treuhandanstalt as the Privatization Agency, and Its Role in South and North Korean Unification
The Treuhandanstalt (THA) was established by the last government of the German Democratic Republic. Now that is has been organized as a public institution with legal capacity which is directly accountable to the Federal authority,..
Date 1993.12.30
Economic developmentDownloadContentSummaryThe Treuhandanstalt (THA) was established by the last government of the German Democratic Republic. Now that is has been organized as a public institution with legal capacity which is directly accountable to the Federal authority, its task is to transform the centrally managed collective combines and state-owned firms of the German Democratic Republic into private companies which are able to compete internationally. As far as the public and academia are concerned, however, the policy and financial behavior of the THA are still obscure after the start-up of the currency union. So far the THA has failed to fulfill its duty of disclosure to the intended extent. This paper tries to briefly examine the role of German Treuhandanstalt as the privatization agency, especially the integration of two different economic systems and derive implications for the coming reunification of the two countries in the Korean peninsula. It is organized as follows. In section 2, the significance of privatization of state-owned property in converting economic system is discussed. Section 3 presents the role and activities of the Treuhandanstalt in the process of German unification. In section 4 the significance of the Treuhandanstalt on the Korean unification will be derived based upon the discussions so far. The paper ends with a summary of results and implications in section 5. -
Trade and Competition: OECD's Perspective
Chung-Soo Kim Date 1993.12.27
Competition policy, Trade policy -
Uruguay Round: Sectoral Evaluation of the Final Agreement
Trade negotiators 117 nations reached an agreement on the Uruguay Round (UR) agreement in Geneva, Switzerland, in 1993 after the launch of UR in 1986. The UR was designed to formulate multilateral trade standards and liberalize tr..
Co-authors Date 1993.12.27
Multilateral negotiationsDownloadContentSummaryTrade negotiators 117 nations reached an agreement on the Uruguay Round (UR) agreement in Geneva, Switzerland, in 1993 after the launch of UR in 1986. The UR was designed to formulate multilateral trade standards and liberalize trade, regulating the world trade system in the 1990s.
The UR agreement attempts to reconstruct GATT, but a series of threats to GATT formation developed in the process of negotiation. The Cold War system collapsed and regionalism spread rapidly all over the world with the European Community integration and the formation of the North American Free Trade Agreement.
Therefore, as with GATT, having legal binding force to some extent, the World Trade Organization was founded to meet the call of the times.
This report suggests that due to Korea's high foreign dependence and small economy, it needs strong multilateral trade formation. -
Export Promotion Systems: Some International Comparisons and the Korean Case
Jung-Dong Kim Date 1993.12.24
Trade policy -
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Tax Implicantions of International Capital Mobilty
The paper begins with a discussion of tax neutrality in an open economy. The focus is on the distinction between taxation based on the ownership of capital and taxation based on the location of capital. Even at this conceptual sta..
Joo-Sung Jun Date 1993.12.01
Capital market, Tax systemDownloadContentContents
1. Tax Neutrality In an Open Economy
A. Source-based Taxation and Capital Import Neutrality
B. Residence-based Taxation and Capital Export Neutrality
C. Implications for Optimal Tax Policy and Policy Coordination
2. The Taxation of Foreign Source Income
3. Tax Distortions to International Investment
A. The Effects of Foreign Tax Credits and Tax Deferrals on the Effective Tax Rate on Foreign Source Income
B. The Effectiveness of Investment Incentives
C. Tax Effects on Financing Decisions
D. Tax Effects on Multinational R&D Decisions
E. Relative Tax Advantage of a Portfolio vs. Direct Investment
4. Implications for Korean Tax Policy
A. Incentives in the Tax Laws
B. Tax Treaties
C. Tax Policy Concerning the Form of Foreign Investment
D. Summary of Policy Implications
〈References〉
SummaryThe paper begins with a discussion of tax neutrality in an open economy. The focus is on the distinction between taxation based on the ownership of capital and taxation based on the location of capital. Even at this conceptual stage, tax implications of moving from a closed economy to an open economy can be dramatic. The greater the mobility of financial capital among countries, the greater are the opportunities for international tax arbitrage. Efficiency considerations may require highly unrealistic constraints on the optimal tax rates such as uniform taxation, exemplifying the difficulty of international tax coordination.
The actual tax treatment of foreign source capital income is quite complex. There exist many other sources of distortion than can be described in a stylized theoretical framework. The efforts by countries to relieve double taxation of foreign source income are often incomplete and asymmetric across income types. The tax treatment of multinationals is extremely complicated, influencing both their real and financial behavior. The existence of alternative forms of international capital flows creates additional complications. Foreign direct investment faces a very different statutory tax treatment than foreign portfolio investment. The role of tax treaties and investment incentives in attracting foreign investment is not as clear as generally perceived. The rest of the paper addresses practical aspects of taxing international capital income.
The organization of the paper is as follows: Section 1 analyzes the basic principles of tax neutrality in the presence of international capital mobility. The most standard practices of taxing foreign source income are summarized in section 2. Section 3 discusses various tax effects on international investment and financial behavior, while their implications for Korean tax policy are presented in section 4. -
Leveraging Technology for Strategic Advantage in the Global Market : Case of the Korean Electronics Industry
Today, Korea is the third largest producer in the world of consumer electronic products and components, and Korean electronics have become the world's third largest industry. It is also the third largest exporter of consumer elect..
Yoo-Soo Hong Date 1993.12.01
Industrial policyDownloadContentContents
I. Introduction
II. History of the Korean Consumer Electronics Industry
III. International Competitiveness of the Korean Electronics Industry
IV. Technology Transfer and Technological Dependence
V. Concluding Remarks
References
SummaryToday, Korea is the third largest producer in the world of consumer electronic products and components, and Korean electronics have become the world's third largest industry. It is also the third largest exporter of consumer electronics, but ranks fifth with the inclusion of components and re-exports.
In 1970, Korea sold 55 million U.S. dollars worth of electronics to the world market. In 1992, two decades later, that figure has skyrocketed to 20.7 billion U.S. dollars, over 6 percent of the world market. Despite growing trade restrictions by the U.S. and by the EC, Korean-manufactured personal computers and VCR's now occupy an impressive share of their respective markets all around the globe, with exports representing more than three-quarters of total production.
Methodological Questions
Why has the Korean electronics industry-an obvious latecomer-been so successful? Can this trend continue? And what lessons does this specific case provide, if any, for other industrializing nations?
These are the issues which will be discussed in this paper. But in order to gain a better appreciation for the complexities involved in these topics, one must first understand what has made the consumer electronics industry unique from other industries in recent Korean history.
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