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  • The Income-led Growth in Korea: Status, Prospects and Lessons for Other Countries

       Income-led growth is at the core of the Moon Jae-in administration’s economic policy. It aims to build an inclusive economy by enhancing the capacity of household consumption and improving distribution, through a mor..

    Sangyong Joo et al. Date 2020.10.08

    Economic reform , Economic development

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    Preface

    Executive Summary

    Contributors

    Chapter 1. Introduction
    1. The Birth of the Income-led Growth in Korea
    2. About this Report

    Chapter 2. Is the Korean Economy in a Wage-led or Profit-led Growth Regime?
    1. Introduction
    2. Measuring Labor Income Share
    3. Effects of Labor Income Share on Aggregate Demand
    4. Labor Income Share and Consumption
    5. Labor Income Share and Investment
    6. Labor Income Share and Net Exports
    7. Labor Income Share and Aggregate Demand
    8. Concluding Remarks

    Chapter 3. The Structure of the Income-led Growth Policies of the Moon Jae-In administration
    1. Basic Scheme
    2. Policy Composition and the Three Pillars
    3. Additional Discussions

    Chapter 4. Economic Performances of the Income-led Growth
    1. GDP and Its Main Components
    2. Employment
    3. Income Distribution
    4. Fiscal Expansion

    Chapter 5. The Minimum Wage Debates in Korea
    1. Introduction
    2. Initial Criticisms and Some Evidences Against Them
    3. Employment Effects of the Minimum Wage Raises in 2018 and 2019
    4. Impact of the Minimum Wage Raises in 2018 and 2019 on Wages and Income
    5. Change of Direction
    6. Conclusion

    Chapter 6. Assessment of the Social Safety Net Policies
    1. Background
    2. Reforms of the National Basic Living Security System
    3. Reinforcement of the Basic Pension
    4. Child Benefits, Youth Welfare, Unemployment Assistance and Housing Welfare
    5. Social Services and Welfare Delivery System
    6. The Mooncare

    Chapter 7. Transition to an Inclusive Regime of Industrial Relations

    1. Introduction
    2. Economic Impacts of Labor Market Institutions
    3. Labor Unions and the Collective Bargaining System
    4. System of Extending Collective Agreements
    5. Institutional Improvement in the Korean Labor Market
    6. Alternative Labor Policies for Income-led Growth

    References
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    Summary
       Income-led growth is at the core of the Moon Jae-in administration’s economic policy. It aims to build an inclusive economy by enhancing the capacity of household consumption and improving distribution, through a more active role of the state and social agreements. This report laregely reviews what the Moon administration’s income-led growth has achieved and has not, as of the end of 2019 (due to the data availability). The reader is advised to keep in mind that the administration had been in two and a half years into the 5-year term by the end of 2019, and the growth effect may take a longer time to realize. The main goal of this interim review is to share the rare case of the income-led growth policies with the policy research circles abroad.
        After an introduction in Chapter 1, Chapter 2 applies the approach of Hein and Vogel (2008) to Korea, to have an idea of the growth regime of the Korean economy. An economy is said to be in a wage-led (profit-led, respectively) growth regime if the aggregate demand increases (decreases, respectively) with labor income share. Because the self-employed takes a large share of the labor force in Korea, the chapter uses adjusted measures of labor income share, following Jeon and Joo (2015, 2018). The empirical evidence indicates that the Korean economy is in a wage-led growth regime, at least since the currency crisis in late 1990s. This is largely because consumption is more sensitive than investment or net export to labor income share, and this sensitivity has become stronger after the currency crisis. This finding suggests that the main cause of the post-crisis consumption
    slowdown in Korea is the concurrent decline in labor income share. This supports the relevance of the Moon administration's income-led growth strategy, which can be interpreted as an attempt to improve the factor income distribution.
        Chapter 3 outlines the directions and contents of the Moon administration’s income-led growth policies. It introduces the virtuous circle that the income-led growth aims at creating, consisting of increase in decent jobs, increase in the household income, enhancement of the household’s capacity for consumption and economic growth. The chapter introduces a detailed structure of this circle, the three pillars of the income-led growth, namely increasing household income, reducing household expenses and expanding welfare and safety net, and the composition of the detailed policies aimed at achieving each of them. It also points out the shortcomings of the current structure and composition. Moreover, it discusses the relationship between the income-led growth and the two other directions of the Moon administration’s economic policy, namely innovative growth and fair economy.
        Chapter 4 offers a brief interim economic assessment of the income-led growth, focusing on the changes in growth and income inequality between 2017 and 2019. It provides evidences that private consumption stayed solid during the period, while construction and equipment investments fell, and income distribution (especially wage inequality and wage share) improved. Growth rates, however, were disappointing, due partly to the global rise in
    protectionism. It argues that fiscal policy was too conservative to properly support the pursuit of income-led growth, leaving more revenue in 2018 than expected, for instance.
        Chapter 5 discusses the minimum wage increases of the Moon administration, which dominated the public’s perception of the income-led growth. The statutory minimum wages were raised, compared to the previous year, by 16.4% for 2018 and 10.9% for 2019. As a result, the hourly minimum wage has risen by 29% from KRW 6,470 in 2017 to KRW 8,350 in 2019. The chapter discusses the socio-economic impacts of the minimum wage raise in the Moon administration. It also reviews the changes of the Moon administration’s policy directions in fairly detail, during which the minimum wage was at the center of the policy debates.
       Chapter 6 offers a brief evaluation of the Moon administration’s social safety net policy in the context of the income-led growth. It reviews how the Korean social insurance and welfare systems, such as the Basic Living Security, Basic Pension and Child Benefit, have been reformed. It assesses the policies related to social services and welfare delivery system. It also discusses the “Mooncare”, the health care policies of the Moon administration.
        Finally, Chapter 7 discusses labor protection in the context of the income-led growth of the Moon administration. It reviews the literature on labor market institutions, trade unions and collective bargaining. It explains the characteristics of the Korean labor market and discusses possible ways to improve the current system of labor protection in Korea. It critically reviews the Moon administration’s labor protection policies and suggests policies that are more consistent with the income-led growth.
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  • An Effect of US-China Rivalry on Latin America and Its Implication

       Conflicts between the United States and China have been appearing in various forms across many regions; it can be seen in trade, commerce, politics, and diplomacy. In addition, it is likely that the conflicts between ..

    Sungwoo Hong et al. Date 2020.12.31

    Economic relations , International politics

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    Summary

       Conflicts between the United States and China have been appearing in various forms across many regions; it can be seen in trade, commerce, politics, and diplomacy. In addition, it is likely that the conflicts between the two countries intensify as the multilateralism would be threatened and protectionism would emerge in the post-COVID 19 era.
       Latin America is not an exception to this issue of the US-China conflict. In terms of national security, the United States has only option to react sensitively to the growing influence of China in Latin America, considering the geographical proximity between the United States and Latin America. For this reason, varied conflicts between the United States and China occur in Latin America.
       This study investigated the patterns of US-China rivalry that appeared in Latin America and analyzed the effects of this rivalry on Latin American countries in multifaceted ways. In Chapter 2, we examined how the US and Chinese foreign policies against Latin America have changed. Furthermore, we summarized specific policies against Latin America that were implemented under the Trump administration. The fundamental goal of the US policy was to occupy a regional hegemony in Latin America by giving them incentive and pressure. In particular, the Trump administration tended to weigh on Latin America in many sectors such as immigration, infrastructure, and so on. By contrast, Chinese policies against Latin America aim at maintaining cooperative relations with Latin America in the absence of specifics.
       In Chapter 3, we presented several examples of the US-China conflict that were observed in Latin America. This conflict was mostly prominent in the infrastructure sector, in which the United States was likely to press Latin America in order to exclude China from related projects.
       In Chapter 4, we conducted an empirical analysis by focusing on the trade dispute between the United States and China that occurred in 2018. Specifically, we analyzed the impact of the retaliatory tariffs between the two countries on exports of major Latin America countries to United States and China. In addition, we complementarily examined the effect of the trade dispute on the welfare of the Latin American countries with the CGE (Computational General Equilibrium) model. As a result of the empirical analysis, Brazil’s export to China have increased significantly since the imposition of the tariffs, and then the effect has disappeared over time. In contrast, there was no consistent pattern for countries other than Brazil. The impact of the US-China conflict on the welfare of the countries in Latin America was trivial.
       The conflict between the United States and China that occurs in Latin America could be an opportunity for Korean companies that seek to advance into Latin America. The companies may be given an unintended chance as Latin America is faced by US pressure to rule out China from infrastructure sector. Therefore, it would be important to monitor the political position of Latin American countries in terms of seeking opportunities to enter Latin America in the future. 

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  • The Vision of Future Cooperation between Korea and Mongolia in the New Northern Era: Cooperation Tasks and Practical Methods by Sector

       Mongolia is one of the world’s top 10 resource-rich countries, with high growth potential based on abundant mineral resources such as copper, gold and coal on its vast land, which is more than seven times the size of..

    Hong-Jin Kim et al. Date 2020.11.30

    Economic reform , Political Economy

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    Summary

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

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  • U.S.-China Technological Rivalry and Its Implications for Korea

       Since March 2018, when President Trump decided to impose additional tariffs on $50 billion worth of Chinese imports, the U.S.-China trade dispute has continued to this day. This study was conducted from the viewpoint ..

    Wonho Yeon et al. Date 2020.08.31

    Economic relations , Political Economy

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    국문요약 


    제1장 서론 
    1. 연구 배경 
    2. 연구 목적, 차별성 및 연구 구성


    제2장 중국의 기술 발전 전략 
    1. 과학기술 육성 정책 
    2. 첨단산업 육성 전략
    3. 과학기술 인재 육성 전략 


    제3장 중국의 부상과 미ㆍ중 기술격차 분석 
    1. 중국의 부상 
    2. 미ㆍ중 기술격차 분석 
    3. 소결


    제4장 미국의 기술 분야 대중국 제재와 중국의 대응 
    1. 미국의 기술 분야 대중국 제재 
    2. 미국의 제재에 대한 중국의 대응


    제5장 결론 및 시사점  
    1. 요약 및 평가 
    2. 시사점 


    참고문헌 


    Executive Summary 

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    Summary

       Since March 2018, when President Trump decided to impose additional tariffs on $50 billion worth of Chinese imports, the U.S.-China trade dispute has continued to this day. This study was conducted from the viewpoint that the nature of the U.S.-China conflict is not a tariff war but essentially a technological rivalry, represented by the U.S. Section 301 report and U.S. sanctions against Huawei.
       Recent developments in technologies are changing the concept of national security and that of hegemonic competition. The key feature of technologies in the 4th Industrial Revolution is dual-use. Emerging technologies such as 5G, AI, big data, robotics, aerospace, supercomputers and quantum computer-related technologies can be used for both civilian and military purposes. The more you invest in the development of advanced technologies, the closer you will be to economic and military hegemony. Therefore, it is no wonder that the U.S. harbors great concerns facing the rise of China in these advanced technologies.
       Chapter 2 examines China’s science and technology development policy, high-tech industry development strategy, and national talent development plan. The rise of Chinese science and technology was not achieved overnight. Since the nation’s founding in 1949, China has always been devoted to developing science and technology. Especially after China’s reform and opening, as economic construction became the central task of the country, science and technology have been perceived as “productive power.” The recent Xi Jinping government continues to place emphasis on science and technology, and aims to build China as a world-leading “Innovative Power.” This is also reflected in various statistics.
       Chapter 3 describes the data that support the rise of China. China is now the world’s largest economy in terms of real GDP (USD PPP) and trade volume, and has grown into the world’s second-largest country following the U.S. in terms of military expenditures, R&D expenditures, and international patent applications. In addition, this study constructs a structural estimation model in which each country produces international patents using R&D expenditures and R&D researchers. Empirical results have presented novel findings indicating that China’s innovative productivity has surpassed that of the U.S. since 2015.
       In light of these developments, Chapter 4 discusses at great detail the U.S. sanctions against China. The U.S. views China as not adhering to the principles of market-based trade and investment systems, rather utilizing a form of state-led mercantilism following its accession to the WTO. Based on the perception that China has used illegally and unfairly acquired U.S. technologies to undermine the national security and foreign policy interests of the U.S., the U.S. is strengthening trade and investment sanctions against China. This study, in specific, investigates the backgrounds, contents, and actual applications of the Export Control Reform Act (ECRA), Article 889 of the 2019 National Defense Authority Act, and the Financial Foreign Investment Risk Assessment Modernization Act (FIRRMA). In return, China is responding to the U.S. sanctions with a new “Long March” strategy rather than a tit-for-tat strategy. In other words, China has been setting long-term goals and responding to the U.S. sanctions by improving institutional arrangements, refining industrial policies, and developing its own technologies.
       Chapter 5 diagnoses the impact of the U.S.-China rivalry on the Korean economy by predicting the possible scenarios of the U.S.-China tensions. An international environment without conflict between the U.S. and China is the best for Korea in terms of both national security and economic growth. This is because South Korea has to strengthen cooperation with China based on a solid ROK-U.S. alliance for security and economic development. The more the conflict between the U.S. and China intensifies, the less policy choices and room for profits are left to Korea. However, the conflict between China and the U.S. is expected to be prolonged due to several reasons including China’s unfair practices, bipartisan anti-Chinese sentiment in the U.S., the institutionalization of tensions, and China’s strong response to the U.S. measures.
       In the short run, it seems important for Korea to pay attention to the negative impacts that might occur due to the expansion of U.S. sanctions against China, rather than expecting the benefits that might be brought by the U.S. sanctions to delay China’s technological progress. Recently, there are signs of the U.S. sanctions against China even further expanding the scope to financial sectors. Ironically, increasing pressure from the U.S. is expected to further strengthen China’s R&D capabilities in advanced technology and accelerate its competitiveness in emerging industries. With the onset of the 4th Industrial Revolution, China is rapidly closing the quality gap and technology gap in major industries where Korea has a comparative advantage. If Korea does not adequately respond to changes, it may be difficult to maintain a comparative advantage over China. Thus, now that U.S.-China tensions are intensifying, Korea is facing a pivotal moment in determining the future path of its economy.
       Moreover, the greater the conflict rises between the U.S. and China, the likelihood increases of pressure being applied on Korea to choose between one or the other. However, as the recent China-Japan relations imply, if you have what the other country needs, it is possible to secure strategic autonomy to realize national interests. Facing the 4th Industrial Revolution, “what every country needs” is “technological power.” We must keep in mind that a cooperative partnership with others and respect from other countries can only be guaranteed when Korea maintains global competitiveness in innovation capacity.
     

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  • A Study on China's Cybersecurity Policy

       This study examined the Chinese government's cyber security policies and compared and analyzed cyber security policies between Korea and China to draw implications for Korea, recognizing the increasing importance of c..

    Minsuk Park and Hyo Jin Lee Date 2020.07.14

    Economic cooperation , Chinese legal system

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    Content

    국문요약


    제1장 서론
    1. 연구의 배경과 목적
    2. 선행연구


    제2장 중국의 사이버보안 전략
    1. 중국의 대내외 사이버보안 전략
    2. 사이버보안 국제 협력 동향


    제3장 중국의 사이버보안 정책
    1. 네트워크 보안
    2. 정보 보안
    3. 암호법


    제4장 한국의 사이버보안 현황 및 한중 비교
    1. 한국의 사이버보안 연혁 및 전략
    2. 한국의 사이버보안 정책
    3. 한중간 사이버보안 정책 비교


    제5장 결론
    1. 평가
    2. 한국에 대한 시사점


    참고문헌


    Executive Summary

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    Summary

       This study examined the Chinese government's cyber security policies and compared and analyzed cyber security policies between Korea and China to draw implications for Korea, recognizing the increasing importance of cyber security worldwide and how the technology hegemony conflict between China and the U.S. continues to intensify.
       Firstly, we analyzed the Chinese government's cyber security policies at the national strategic level in Chapter 2. China has implemented information control over cyberspace at the national level to maintain social order. Especially, Xi’s administration has positioned cyberspace sovereignty as a part of national sovereignty, in line with which cyber security strategy is established. In the field of cyber security, international cooperation is required, but there are difficulties arising from the disparity between the regulatory scope and priority areas of cyber security by country. Therefore this study examined international cooperation with major countries in the area of cyber security currently pursued by the Chinese government to identify major issues in the nation’s cyber security strategy. China and the U.S. operate upon different concepts in their scope of cyber security. China is a centrally controlled country that sets the priority of cybersecurity as a matter of “national security,” whereas the U.S. regulates cyber security, focusing on "protecting privacy" based on individual rights and the freedom of expression. On the other hand, Russia operates upon a similar perception of cybersecurity to China in terms of strengthening its national sovereignty in cyberspace, controlling the country's information flow, and applying changes to the international cyber governance system. In the case of the EU, its position varies by individual case.
       Chapter 3 analyzed the main contents and features of the recently implemented Cyber Security Act to examine the Chinese government's cybersecurity policy from a legal system perspective. The Chinese government has been announcing follow-up measures to implement the Cyber Security Act since 2019 and strengthen its enforcement power. The Act mandates certification of network security management systems, security grade protection systems, and network security related products and services. In addition, a "safety review" has become mandatory and regulations related to the transfer of personal information and important data to foreign countries have been included in recently announced laws. In order to start information management in earnest, the Cryptographic Act was enacted in 2020, therefore further expanding the scope of regulations on cyber security.
       In Chapter 4, we look into the main contents of Korea's cyber security policy and compared and analyzed the cyber security policies between Korea and China. Currently, Korea lacks a cyber security law that covers both the public and private sectors, such as in effect within China. However, based on the national cyber security strategy announced in April 2019, the government announced the “National Cyber Security Basic Plan 2019-2022” in September 2019 and is gradually implementing 100 detailed tasks in areas such as strengthening cyber security, establishing legal systems, and international cooperation.
       Based on this analysis of the cyber security policies of China and Korea, we derive the following conclusions for Korea.
       It is important for Korean companies to continuously monitor and prepare related systems in order to adapt to changes in the business environment situation where China is strengthening cybersecurity measures to manage internal and external risks. The government should also seek areas that can be supported at the national level. First of all, China's implementation of the Cyber Security Act has made it mandatory for Korean companies to obtain security grades. In Korea, the network security level is a recommended standard, but in China this is compulsory. Hence, Korean companies must independently come up with their own countermeasures in related fields, and government support is also needed to minimize confusion during this process. Next, certification in the network equipment sector has become more complex, and new regulations on personal information and data security are being prepared to take effect. Consequently, related policies and regulations are expected to be announced in the near future. In response, the Korean government should hold regular briefing sessions on related policies for Korean companies operating in China. It is also necessary to consider the ongoing cooperation at the national level and make efforts to further strengthen communication channels.


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  • Korea-China Competitiveness Changes and Our Strategies According to the Industrial Upgrading of China

    Chuel Cho et al. Date 2020.06.29

    Economic relations , Industrial structure

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    국문요약 


    제1부 주요 산업의 한·중 경쟁력 종합 비교 분석 및 대응방안(종합편) 


    제1장 서론 
    1. 연구의 필요성 및 목적
    2. 산업구조 고도화의 정의 및 연구 방향
    3. 연구범위 및 방법 


    제2장 중국 주요 산업의 구조고도화 추이 비교 분석 
    1. 중국 주요 산업의 양적 성장과 수급구조 변화 추이 
    2. 중국 주요 산업의 질적 구조고도화 추이 
    3. 중국의 산업정책과 산업구조고도화 전망 


    제3장 주요 산업의 한·중 경쟁력 종합 비교 분석 
    1. 주요 산업의 한·중 무역경쟁력 비교  
    2. 한·중 정성적 경쟁력의 업종 간 비교 
    3. 업종별 한·중 경쟁구조의 변화 추이 및 전망


    제4장 우리 산업의 종합 대응전략 
    1. 주요 산업의 한·중 경쟁구조 변화와 분업 전략
    2. 우리 산업의 대중국 경쟁력 강화 전략
    3. 중국 시장 진출전략 및 한·중 협력 방안


    제2부 업종별의 한·중 경쟁력 종합 비교 분석 및 대응방안(업종편) 


    제1장 자동차산업 
    1. 중국 자동차산업의 수급 추이와 특성변화 
    2. 중국 자동차산업의 질적 구조고도화 추이 
    3. 중국 자동차산업정책 변화와 구조고도화 전망 
    4. 자동차산업의 한·중 경쟁력 추이와 전망
    5. 자동차산업의 대중국 대응전략 


    제2장 조선산업 
    1. 중국 조선산업의 수급 추이와 특성변화 
    2. 중국 조선산업의 질적 구조고도화 추이 
    3. 중국 중국산업정책 변화와 구조고도화 전망 
    4. 조선산업의 한·중 경쟁력 추이와 전망
    5. 조선산업의 대중국 대응전략 


    제3장 일반기계산업 
    1. 중국 일반기계산업의 수급 추이와 특성변화 
    2. 중국 일반기계산업의 질적 구조고도화 추이 
    3. 중국 일반기계 산업정책 변화와 구조고도화 전망
    4. 일반기계산업의 한·중 경쟁력 추이와 전망
    5. 일반기계산업의 대중국 대응전략 


    제4장 철강산업 
    1. 중국 철강산업의 수급 추이와 특성변화 
    2. 중국 철강산업의 질적 구조고도화 추이 
    3. 중국 철강산업정책 변화와 구조고도화 전망 
    4. 철강산업의 한·중 경쟁력 추이와 전망 
    5. 철강산업의 대중국 대응전략 


    제5장 석유화학산업 
    1. 중국 석유화학산업의 수급 추이와 특성변화 
    2. 중국 석유화학산업의 질적 구조고도화 추이 
    3. 중국 석유화학산업정책 변화와 구조고도화 전망
    4. 석유화학산업의 한·중 경쟁력 추이와 전망
    5. 석유화학산업의 대중국 대응전략 


    제6장 식품산업 
    1. 중국 식품산업의 수급 추이와 특성변화 
    2. 중국 식품산업의 질적 구조고도화 추이 
    3. 중국 식품산업정책 변화와 구조고도화 전망 
    4. 식품산업의 한·중 경쟁력 추이와 전망 
    5. 식품산업의 대중국 대응전략 


    제7장 반도체산업 
    1. 중국 반도체산업의 수급 추이와 특성 변화 
    2. 중국 반도체산업의 질적 구조고도화 추이 
    3. 중국 반도체산업정책 변화와 구조고도화 전망 
    4. 반도체산업의 한·중 경쟁력 추이와 전망 
    5. 반도체산업의 대중국 대응전략 


    제8장 디스플레이산업 
    1. 중국 디스플레이산업의 수급 추이와 특성 변화
    2. 중국 디스플레이산업의 질적 구조고도화 추이
    3. 중국 디스플레이산업정책 변화와 구조고도화 전망
    4. 디스플레이산업의 한·중 경쟁력 추이와 전망
    5. 디스플레이산업의 대중국 대응전략 


    제9장 휴대폰산업 
    1. 중국 휴대폰산업의 수급 추이와 특성변화 
    2. 중국 휴대폰산업의 질적 구조고도화 추이 
    3. 중국 휴대폰산업정책 변화와 구조고도화 전망 
    4. 휴대폰산업의 한·중 경쟁력 추이와 전망 
    5. 휴대폰산업의 대중국 대응전략 


    제10장 가전산업 
    1. 중국 가전산업의 수급 추이와 특성변화 
    2. 중국 가전산업의 질적 구조고도화 추이 
    3. 중국 가전산업정책 변화와 구조고도화 전망 
    4. 가전산업의 한·중 경쟁력 추이와 전망 
    5. 가전산업의 대중국 대응전략 


    제11장 인공지능산업 
    1. 중국 인공지능산업의 발전 추이
    2. 중국 인공지능산업의 질적 구조고도화 추이
    3. 중국 인공지능산업정책 변화와 구조고도화 전망
    4. 인공지능산업의 한·중 경쟁력 추이와 전망
    5. 인공지능산업의 대중국 대응전략 


    제12장 게임 산업 
    1. 중국 게임 산업의 발전 추이 
    2. 중국 게임산업의 질적 구조고도화 추이
    3. 중국 게임산업정책 변화와 구조고도화 전망
    4. 게임산업의 한·중 경쟁력 추이와 전망 
    5. 게임산업의 대중국 대응전략 


    참고문헌 

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  • A Study on Private Enterprises and Entrepreneurs in Transition Economies: Focusing on Russia and Vietnam

       Privatization is the first priority of transition economies because it is the most critical process of shifting from a planned economy to a market economy. Even state enterprises can gain competitiveness by attracting..

    Seok Hwan Kim et al. Date 2020.08.31

    Economic opening , Economic reform

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    국문요약 


    제1장 서론 
    1. 연구의 배경  
    2. 선행연구 
    3. 본 연구의 차별점 및 연구 방법론과 범위  


    제2장 체제전환을 위한 민영화와 극복 과제들 
    1. 체제전환국이 직면했던 도전 과제와 북한의 체제전환 시도 
    2. 체제전환 국가들의 차이점과 공통점: 점진적 방식과 급진적 방식  


    제3장 러시아의 체제이행과 민영화 정책 
    1. 러시아의 체제이행 배경 
    2. 러시아의 민영화 과정과 특징
    3. 러시아의 민영기업 및 기업가 특징과 사례 분석 
    4. 러시아 민영화에 대한 평가 


    제4장 베트남의 체제이행과 민영화 정책 
    1. 베트남의 체제이행 배경 
    2. 베트남의 체제이행 과정과 특징
    3. 베트남의 민영기업 및 기업가 특징과 사례 분석
    4. 베트남 민영화에 대한 평가 


    제5장 결론: 북한에 대한 시사점 


    참고문헌 


    Executive Summary

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       Privatization is the first priority of transition economies because it is the most critical process of shifting from a planned economy to a market economy. Even state enterprises can gain competitiveness by attracting foreign capital and adopting foreign technologies. Meanwhile, the most important element of privatization is confirming ownership. For this, it is necessary to go though complex negotiation and mediation between conflicting parties. Otherwise, privatization cannot be completed and the expected effects will not be realized. Based on this understanding, chapter 2 examines the economic plight and challenges faced by the planned economies before the transition process.
       Chapter 3 reviews the major features of Russia’s privatization by period and of Russian businessmen. In addition, success factors and failure factors are presented through an analysis of privatized companies. Against this backdrop, implications for North Korea are drawn, centered on potential issues that could arise during its transition process.
       In chapter 4, Vietnam’s case is analyzed. Vietnam had a different social and economic structure from Russia when it began privatization. Russia was a large autarkic economy with a highly industrialized structure, whereas Vietnam was a small autarkic economy with a low level of industrial development. Thus, privatization in Vietnam proceeded differently as the collective leadership system by the labor party remains intact.
       The first lesson we learn from Russia’s and Vietnam’s experiences is that institutionalization is the prerequisite of privatization. Structural changes of a society and economy can be accomplished only through legislation and institutionalization. Without these crucial developments, investors or capitalists in the market can be discouraged from participating. Another lesson is the importance of forming ardent reformist groups. Such groups can prevent any attempts to reverse progress and return to the past. As seen in Russia’s and Vietnam’s cases, North Korea can implement reforms and transition successfully by quickly developing the private sector and nurturing capitalist businessmen. Establishing a business-friendly climate is a significant factor of success in privatization.
     

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  • Changes in China’s National Strategy and Its Implication for ROK-China Relations

    Nam Ju Lee et al. Date 2020.06.29

    Economic relations , Political Economy

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    국문요약 


    제1장 서론 
    1. 연구의 필요성과 목적
    2. 연구 내용과 방법


    제2장 중국공산당의 시대인식과 국가전략 변화 
    1. 중국공산당의 시대인식 변화 - “강해지기”(?起來)의 시대 
    2. 신시대론의 국가전략에 대한 영향 
    3. 새로운 국가전략의 전망 ? 4개의 시나리오 


    제3장 국가 거버넌스체제의 변화와 대응전략 
    1. 중앙 차원의 거버넌스체제 변화 
    2. 지방 차원의 거버넌스체제 변화  


    제4장 중국 대외전략의 변화와 대응전략 - 미중관계를 중심으로 
    1. 중국 대외전략의 변화와 미중관계 
    2. 중미 무역분쟁이 한국경제에 미치는 영향 - 무역, 기술, 금융 분야를 중심으로


    제5장 중국 국가전략 변화가 한국의 대중국전략에 주는 시사점 - 대중국전략의 연속과 변화  
    1. 중국 국가전략 변화에 따른 도전 요인과 기회 요인
    2. 대중국전략에 대한 시사점 


    참고문헌 

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  • Date 2020.07.29

    Economic relations , Business management

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    국문요약


    제1장 서론 및 문제 제기 
    1. 연구 배경 및 목적 
    2. 기존 연구와의 차별성 


    제2장 중국 진출 한국 중소기업 사업 환경의 변화 
    1. 중국의 외부 경영 환경 변화 
    2. 중국의 산업구조 고도화와 경쟁 환경의 변화 
    3. 외국인 투자기업에 대한 경영 환경의 변화 
    4. 경기 분석과 인터뷰를 통한 경영 환경의 악화 요인 분석 


    제3장 주요국의 대중국 비즈니스 전략 변화 
    1. 주요국 중국 비즈니스 개황과 특징 
    2. 일본의 대중국 비즈니스 전략의 변화와 특징 
    3. 대만의 대중국 비즈니스 전략의 변화와 특징 
    4. 이스라엘의 대중국 비즈니스 전략의 변화와 특징 
    5. 독일의 대중국 비즈니스 전략의 변화와 특징 


    제4장 한국 중소기업의 중국 사업 전략 도출 
    1. 중국 진출 중소기업 유형화의 선결 과제 
    2. 유형별 중소기업 현황과 전략적 이슈에 대한 인터뷰
    3. 한국 중소기업의 중국 비즈니스 전략 제언


    제5장 결론과 정책 제언 
    1. 연구결과 종합 및 주요 시사점
    2. 한국 중소기업의 중국 비즈니스 정책 과제 


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  • A Comprehensive Evaluation on Korea’s ODA to Rwanda’s Agriculture Sector and Its Implication for Strategic Approaches

       This study conducts a comprehensive evaluation of Korea’s ODA to Rwanda’s agriculture sector and seeks ways to enhance its quality from a holistic point of view. Against this backdrop, this study carries out an eval..

    Young Ho Park et al. Date 2020.07.28

    Economic development , Economic cooperation

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       This study conducts a comprehensive evaluation of Korea’s ODA to Rwanda’s agriculture sector and seeks ways to enhance its quality from a holistic point of view. Against this backdrop, this study carries out an evaluation using sub-sectors (hereafter ‘clusters’) of ODA as the basic unit, rather than assessing the performance of individual projects. This study is based on the view that cluster evaluation

    — grouping projects with similar purposes into clusters and evaluating overall performance by cluster will enable comparative evaluation of different project sectors and provide meaningful insights in devising strategic plans for development assistance. With the establishment of the Country Partnership Strategy (CPS), the demand for comprehensive evaluation of aid performance at the industry level or the overall national development level, rather than at the level of each individual project, has been increasing. The research pursues evaluation in line with this policy demand.
       Recently, there has been a growing consensus in the domestic and international aid community that sporadic project aid should be avoided, while achieving CPS-level performance goals, and seeking state-level development assistance that meets the national development strategies of recipient countries.
       Chapter 2 examines the current state of Rwanda’s agricultural ODA as well as its main characteristics. Based on the cluster classification criteria of this study, it was observed that Korea dispersed aid funds in a more decentralized manner compared to other developed countries. In addition, various aid projects of different characteristics were observed within a single cluster, making fragmentation in aid practice more evident. For example, in the case of the “agricultural development” cluster, three aid agencies have each carried out assistance projects with different characteristics. Aid projects have been executed independently without any link among different clusters. Considering Korea's relatively small aid scale and insufficient aid capacity, a decentralized resource allocation structure and sporadic aid delivery are not desirable.
       In Chapter 3, a comprehensive evaluation was conducted on Korea’s ODA projects in Rwanda’s agricultural sector between 2013 and 2017, using three frameworks: planning, operation and performance. The evaluation criteria consists of four indicators (relevance, efficiency, effectiveness and sustainability) widely used in the evaluation of international development projects. This study devised Cluster Performance Index (CPI) by numerically calculating each cluster’s performance by each indicator. In addition, the Resource Allocation Index (RAI) was formulated to assess Korea’s presence in the Rwandan agriculture ODA sector, where a number of international actors competitively provide aid. The RAI and CPI were then mapped in quandrants to visualize each cluster’s performance compared to the amount of funds injected. The results of the comprehensive evaluation are summarized as follows.
       First, in terms of planning or strategic management, it appears that projects are mostly planned appropriately, but in some clusters, large amounts of the budget have been invested in poorly planned projects. Project sites being dispersed across multiple provinces was also a problem. Although Rwanda’s small land area reduces inconveniences caused by such dispersion of sites, it would still be advisable to carry out similar or related projects in neighboring areas and to strategically conduct projects in the same cluster within the same district or cell through aid harmonization. Such strategic planning would promote efficiency in project management and lead to synergy between projects.
       Secondly, in terms of operational management, there was considerable room for improvement in all clusters. Particularly, all clusters scored below average in the Monitoring and Evaluation (M&E) category. The number of monitoring sessions should be increased, and there is much to be improved in terms of monitoring quality. While it is important to build partnerships with aid agencies in the recipient countries in order to implement projects efficiently, all clusters scored moderately in this category. In terms of the rate of budget execution versus budget commitment, most clusters implemented their budgets efficiently as planned. While there were few cases of project periods being extended, there were several cases of modifications being made to the project contents. Considering that project planning cannot be perfect due to the shortage of professional ODA consulting agencies in Korea’s ODA sector, this study avoided lowering CPI scores entirely based on the number of changes made. Instead, the background and gravity of each change were considered in the evaluation. Nevertheless, some projects had made significant changes that could undermine project efficiency, indicating some improvements would be necessary in terms of the efficiency of project operations.
       Third, in terms of performance evaluation, all clusters scored relatively high in effectiveness. On average, scores were also high in sustainability, but relatively lower in effectiveness. Within the effectiveness category, scores were particularly high in goal achievement with many projects exceeding the planned goals. On the other hand, some inadequacies were revealed in ex-ante evaluations of the project implementation environment. While it is important to achieve planned goals, it is also crucial to improve effectiveness by considering the characteristics of the project site during project implementation. Rwanda’s distinct project environment characterized by a high percentage of unschooled farmers and multiple official languages also necessitates improvement in communication through strengthening the capacities of local coordinators and interpreters, or having dispatched Korean workers learn the local languages. In terms of sustainability, no case was observed where Rwandan government’s policy changes hampered the sustainability of projects. On the contrary, risk management was found to be relatively inadequate in all clusters. Stakeholders tended to perceive potential risks as relatively less important than other factors. Feasibility study reports also had very little content related to risk analysis, and in-depth analyses were scarce. In some cases, project sustainability was jeopardized due to poor response to risks. Further efforts should be made to analyze risks at the planning stage, and risk management capacities should be strengthened by sharing cases of risk occurrence and successful risk management. In terms of follow-up management, all clusters scored average. While post-completion project maintenance largely depends on the coordination system with the recipient country as well as the administration capacity of the local government in the project site, as projects are mainly carried out in areas with high poverty rates, the local governments tend to lack capacity. Korean ODA agencies can do little about the local governments’ capacity, while they can make efforts to strengthen cooperation with the recipient country to ensure project sustainability. The better the partnership is, the more willing the recipient government will be to maintain completed projects. Overall, in terms of cluster average scores, projects have done best in the area of effectiveness, followed by relevance and sustainability, and scored lowest in efficiency.
       Chapter 4 comprehensively analyzes Korea’s ODA to Rwanda’s agriculture sector through network analysis and contribution analysis. Firstly, the “consistency” of Korea’s ODA with regard to the goals presented in the Rwandan national development strategy and the CPS of the Korean government was measured through network analysis. While in the previous chapter the degree of consistency was simply measured by indexing, in this chapter, the degree was measured quantitatively. Considering that Korea’s CPS is based on the development needs of the recipient country, it could be said that the CPS and Rwanda’s national development strategy share common goals, but this study assumes that in reality they could have different priorities and examines both sides independently when measuring the degree of relevance of Korea’s agricultural ODA with regard to them. Secondly, using System Dynamics Simulation, this study estimated the contribution of Korea’s agricultural ODA to Rwanda’s GDP and its employment inducement effect. The contribution of Korean ODA to Rwanda’s GDP was analyzed by industry, and the contribution of the agricultural sector relative to that of other sectors was subsequently calculated in proportion.
       Quantitative measurement of the consistency of Korean project- type ODA with respect to Rwanda’s national development needs showed the highest consistency with the goal of expanding agricultural productivity, while there was little consistency with other objectives such as good governance, economic integration, etc. Combined analysis of project-type ODA and training-type ODA showed links, albeit weak, to development goals in fields other than agriculture. Moreover, contribution analysis showed that Korea’s agricultural ODA to Rwanda has contributed approximately $100 million to Rwanda’s GDP in 2016. Agricultural ODA contributed more to Rwanda’s GDP than ODA in any other field. This implies that Korea should continue to prioritize the agricultural sector in its ODA to Rwanda. Furthermore, it was estimated that Korea’s agricultural ODA has led to an average of about 4,000 jobs being created per year over the analysis period.
       Chapter 5 draws suggestions and lessons from the aforementioned observations and analysis results and presents several measures to improve aid quality, summarized as follows. First, budget allocation optimization was presented as a means of better strategic planning and management. Strategic allocation of ODA resources is directly related to efficiency in goal achievement and is an important issue to be addressed at the planning stage. Rwanda is one of Korea’s 24 priority partner countries, and ODA budget allocation is becoming more complex as aid sectors and means in agriculture grow diverse and participating entities expand. In turn, strategically deciding how much resources, within a given budget, are to be invested in which sector through systematic analysis has emerged as an important issue. This study seeks ways to optimize budget allocation by applying cluster performance index (CPI) and resource allocation index (RAI) values to Fiedler’s Contingency Theory Model. According to the analysis, resource allocation efficiency would be improved if ODA is expanded significantly in the Agricultural Training and Education cluster (C3), gradually expanded in the Agricultural Policy and Administration cluster (C1) and Rural Development cluster (C5), and gradually reduced in the Agricultural Development (C2) and Agricultural Cooperatives (C4) clusters.
       Secondly, this chapter presents measures to improve monitoring efficiency in terms of strategic operational management. Project evaluation results showed low overall efficiency scores across all clusters, and among efficiency assessment categories, scores were particularly low in M&E. Based on stakeholder interviews, this study proposes that considering the distinct features of agricultural ODA projects, agencies could dispatch Korean or local employees in the vicinity of the project site to frequently monitor projects in order to enhance efficiency. Moreover, with projects conducted by multiple agencies, monitoring quality could be improved by enabling monitoring experts to obtain necessary information through direct communication with the recipient government and project beneficiaries, rather than by relying on project implementation agencies. In addition, this chapter points out that project efficiency and performance can only be assessed properly with a thorough baseline survey to refer to in evaluating progress and performance with regard to the project plan. Furthermore, this chapter emphasizes the necessity to supplement inaccurate data through qualitative assessment when considering the risk of data collected from surveying farmers lacking accuracy. Lastly, this chapter suggests that establishing feedback measures for monitoring results warrants more attention and effort.
       Third, this study proposes enhancing synergy in ODA through cluster integration. Among its five East African priority partner countries, Korea provides the largest amount of agricultural ODA to Rwanda. Compared to other advanced donor countries, Korea’s agricultural aid to Rwanda is characterized by decentralized investment of aid funds. Differences in the allocation of funds could be due to each donor country’s unique aid policies or comparative advantages, so it is not an issue to be simply judged right or wrong. However, such dispersed allocation is not desirable considering Korea’s limited aid capacity and the “selection and concentration” ODA strategy. This study proposes intracluster, intercluster linkage or convergence as a strategy to enhance ODA effectiveness. We must seek measures to combine individual projects currently implemented and build a meaningful program. Combining multiple projects and forming a program targeting a single purpose can reduce the administrative burden caused by fragmentation and enhance aid effectiveness. However, since it would be difficult to create a “convergence program” simply by tying existing projects without a framework established at the planning stage, we would need an approach where a core cluster is selected as the backbone and other clusters are linked around it or reinforced with future projects.
       Lastly, this study presents the agricultural value chain program approach. Rwanda’s agricultural development strategy aims to shift away from its subsistence-level agriculture and transform into a market-led structure, while Korea’s CPS is aimed at increasing agricultural productivity and increasing farmers’ income by strengthening self-help capacity in rural communities. Considering Rwanda’s development goals and Korea’s aid objectives, Korea’s ODA approach needs to expand beyond the current individual project level to a higher program level supporting the value chain. Given Korea’s limited aid capacity and experience, it is likely that Korea would only be able to plan “narrow-range” value chain projects in the initial stage, and it would first need to seek connection and convergence between the agricultural sector and other key areas such as education and ICT. This is also presented as an important strategy in Korea’s CPS. Rwanda is a country with underdeveloped agriculture and has been pushing for transformation in its agricultural structure through value-added agricultural products, and demand is expected to surge in the agricultural industry; in turn, Korea should include areas such as processing, packaging, and quality control technologies in vocational education and training projects to seek synergy in ODA. Projects that connect agriculture with ICT should also be actively promoted. As ICT has cross-cutting characteristics, it should be used as a solution for improving access to technical information (cultivation techniques), spreading market information on agricultural products (trading volume and price), and increasing financial accessibility (mobile microfinance and payments). In Rwanda, the proportion of people who own mobile phones has surged from 6% in 2006 to 71% in 2017.
       To successfully lead Rwanda’s agricultural ODA, efficient operation (implementation) management must be emphasized along with systematic planning (strategic) management. Many of the improvement measures presented in this study regard planning and management. As most agricultural ODA projects are carried out in rural areas with poor conditions, problems such as additional expenses due to unexpected logistical costs, weak monitoring, and delays in project schedules are inevitable. Considering such realities, the stance of this study is that strengthening the planning stage through, for instance, feasibility studies and basic design studies (BDS) based on sufficient information is more important than repeatedly pointing out similar problems that recur in operational management. Budget allocation at the planning stage is important in terms of strategic management because funds should be allocated appropriately to each cluster early on for ODA predictability and effectiveness to be enhanced. Enhanced aid predictability helps improve the stability of project operations, which can lead to higher aid quality. Rational allocation of aid funds is also in line with the policy demand calling for a top-down approach. Without proper planning and adequate resource allocation corresponding to each cluster’s respective potential aid effectiveness, there will be limits to achieving goals no matter how much effort and time is spent on operation and management. While it is important to increase the overall quantity of aid, in terms of achieving objectives, it is essential that given budgets are strategically allocated and efficiently executed.


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