In my last column I looked back on the 2010s in South Korea; this time I look forward and offer some predictions for the 2020s. The predictions highlight the challenges that South Korea will face in the new decade.
Domestically, the aging of the population and generational change will have a profound influence over South Korean society. By the end of the decade, most of the large post Korean-War baby boom generation will be in its seventies and well into retirement. Meanwhile, most of the politically engaged 386 Generation will in its sixties. The majority will be retired with the rest retiring in the early 2030s. These large, aging generations will lean conservative as they adjust to life on a retirement income.
The generation with no memory of poverty or dictatorship that came of age in the late 1990s and 2000s will be moving into their prime working years and taking senior positions in South Korean society. This is the first generation to grow up with computers and the Internet. It is also the first to experience extensive overseas travel in its youth. With support from younger generations, this generation will continue to push for greater openness in society, which will counter the conservative lean of older generations.
Economic growth in South Korea has slowed in recent years and will remain low throughout the decade. To date, economic slowdowns caused a sharp political reaction against the incumbent government, but that trend will fade in the 2020s and slow growth becomes the norm. An aging population and slowing growth in China, South Korea’s largest trading partner, make a return to faster growth difficult.
Despite the slow growth, strong R&D investment and high levels of education will ensure that South Korea remains competitive economically. The country will surpass Japan in per capita GDP and become equal to most major European nations. An accelerating decline in the working age population will keep unemployment low even as AI and automation spread throughout the economy.
The situation on the Korean Peninsula will remain tense because of the North Korea’s nuclear arms and ballistic missile development programs. Tense relations between the US and China and Russia will make it difficult for major powers to apply greater pressure on North Korea. The increasingly isolationist US will lack the political will to act alone and will revert to a containment policy. In South Korea, interest in reunification and North Korea in general will fade as the 386 Generation leaves the stage.
By the end of the decade, North Korea will find itself isolated and increasingly irrelevant, but those expecting a collapse will continue to be disappointed. Kim Jung-un will continue to support a growing consumer economy for elites in Pyongyang to ensure that they remain loyal to him. The elites will follow along because they have no alternative.
Since 2000, South Korea’s economic relationship with China has grown rapidly. China now absorbs 25 percent of South Korean exports, more than double the US at 12 percent, and 21 percent of imports, again more than double the US at 10 percent. In the 2020s, the percentage of trade with China will begin to fall as South Korea seeks new markets in faster growing countries. Economic growth in China, meanwhile, will slow considerably as the population ages, causing growth in trade to slow as well.
Decreasing economic dependence on China will help South Korea keep a comfortable distance from the country. This will also make it easier to keep the alliance with US because South Korea will be less susceptible to Chinese pressure. Despite growing isolationism, the US will take a greater interest in the alliance as it shifts toward containing North Korea.
Climate change has already emerged as that most important global issue of the 2020s. South Korea has ratified the 1997 Kyoto Protocol and the 2016 Paris Agreement, but it has not taken the lead in fighting climate change. According to the Climate Action Tracker (CAT), an independent scientific analysis that tracks government climate action, South Korea falls into the “highly insufficient” category, along with its two big neighbors, China and Japan.
In the new decade, South Korea will gradually raise its profile in the fight against climate change by focusing on technological developments that reduce dependence on fossil fuels. Many of these developments will be tested in the domestic market first before being exported. By the end of the decade, South Korea will be known as a leader in renewable energy technology and a responsible global citizen.
Robert J. Fouser
Robert J. Fouser, a former associate professor of Korean language education at Seoul National University, writes on Korea from Pawtucket, Rhode Island. He can be reached at email@example.com -- Ed.