Anna.Fifield
Financial Times
August 6 2008
http://www.ft.com/cms/s/0/1b22cb0a-63d2-11dd-844f-0000779fd18c.html
In South Korea, there is only one speed: full throttle.
Buildings go up almost overnight, trends pass no sooner than they have arrived and presidents’ approval ratings drop from 70 to 20 per cent in the blink of an eye. One of the first local sayings that foreigners learn is bballi bballi — fast, fast.
When I moved to Seoul four years ago, I was immediately impressed by Koreans’ determination and energy, the two biggest factors behind the country?s transformation from rural backwater to technological powerhouse. As I prepare to leave, I still marvel at this country’s verve. But I cannot help wondering whether South Korea can avoid falling into the kind of economic malaise that has afflicted Japan. The country remains overwhelmingly dependent on goods exports and the service sector is woefully underdeveloped and inefficient. But of all the challenges facing South Korea, there is one, often overlooked, area where reform would bring unparalleled benefits: education.
Devoid of natural resources, Korea?s recourse has been to its human capital. People propelled Korea to where it is today, thanks largely to Park Chung-hee, the former president and a military strongman who directed Koreans to study engineering in particular. One senior Samsung executive this week explained to me that two significant components of the conglomerate’s ‘success DNA’ were its ability to move quickly and the calibre of its engineers. Now, more than ever, human capital will be the deciding factor in how South Korea fares in the future and whether it makes its next transformation, into a knowledge economy.
Koreans perform exceptionally well in international performance rankings for subjects including reading comprehension, maths, science and problem solving, and the proportion of 25-34-year-olds with an upper secondary school education is the highest in the Organisation for Economic Co-operation and Development. Koreans now represent the largest group of international students in American universities.
But they have got there through the most arduous process, driven by the intense social pressure to get into the right school, then the right university, find the right job and meet the right spouse. One friend recounted how when her three-year-old?s kindergarten conducted psychometric testing, the other mothers earnestly jotted down the results, noting whether to push their tots towards law, medicine or finance.
Koreans spend more time at school than students in any other developed country and spend the most money on education (8 per cent of gross domestic product), with private education expenditure double that of the US, the second biggest spender. Bank of Korea data show that families spent more than $12bn (EUR7.7, £6bn) on after-school education last year.
The system rests largely on rote learning and places almost no value on analysis, creative thinking or practical application. High school students who can score 99 per cent in an English test are often unable to hold even a simple conversation, while university students who express a contrary view to their professor simply fail. So intense is the pressure to get good grades that 12-year-olds, after spending all day at school, routinely attend cram school, or hagwon, until midnight.
This obsession with education has contributed to a number of social and economic problems ? from the low fertility rate, partly the result of the cost of putting children through private tuition, to the real estate bubble in southern Seoul, where the best schools and hagwons are located.
It also augurs ill for the future, when South Korea will not need so many workers who can build ships and assemble cars, but will need more and more people who can be innovative, who can develop and apply knowledge. Indeed, despite Korea?s impressive headline performance in test scores, the World Economic Forum ranks the quality of the country?s education system at 60th in the world ? shockingly low for one of the world?s top dozen economies.
Creating a knowledge-based economy will be critical if South Korea is to maintain decent levels of growth — the potential rate is now 5 per cent — and to reach income levels of the world?s most developed countries. One of President Lee Myung-bak’s big pledges is to see Korea’s per capita income double to $40,000 within a decade.
Koreans have already performed remarkably in IT — particularly on the hardware side — but improving the education system would produce workers better equipped to meet the needs of the country?s fast-moving technology industries.
Further growth can be achieved through productivity gains — Korea’s productivity is 60 per cent below the US level. Service sector productivity is only half that of manufacturing, and has been stagnant for almost 15 years. Given the nature of the education system, this can be no coincidence.
Overhauling this system will be incredibly difficult. After all, another of my friends, an enlightened mother who would prefer her 14-year-old to play basketball after school and go to bed before 1am each night, can not even dissuade her son from going to hagwon.
However, for its future prosperity and to retain its economic prowess, Korea would do well to take its foot off the accelerator slightly, take stock and think about using its impressive drive and human capital in more efficient ways. The economy will benefit and the kids will love it.