South Korea: Social and solidarity economy and socio-economic development, by Eric Bidet, associate professor, Hankuk University of Foreign Studies (Seoul)

The socio-economic development model adopted by South Korea with some success for about thirty years (1965-1997) has enabled this country, among one of the poorest country on the planet at the end of the 1950s, to enter OECD in 1996 and be part of the major world economic powers today. In the course of this development, the social economy was continuously smothered in favour of family, market and State that occupied most of the ground. Such a context gave rise to what one would call a « pseudo social economy »: organizations displaying semblance of social economic organizations (same names, same juridical statutes, same formal operating rules) without having their essential characteristics. This false social economy has for a longtime wavered between structures organized and controlled by public authorities catering to public policy objectives (agricultural cooperatives –nonghyeop- and certain « associative » movements like Saemaeul Undong in this way had the main objective of controlling the rural electorate for a longtime enjoying wide majority up to the 1970s) and some organizations set up by the capitalist sector to escape certain fiscal measures as far as taxation on profits or transfer of inheritance was concerned (it is the case of many foundations created by the Korean jaebols).

 

The South Korean socio-economic development model has for a longtime been built upon a type of society marked by quasi full employment, strong inter-generational family solidarity drawing its resources on the Confucian culture, single-income household model and poor participation of women in the socio-economic life. Now, except for major changes, the South Korean population will begin to decline in 2020 and the proportion of persons more than 60 years old would triple in 2050. This aging, considered as the most rapid in the world for the next few decades, questions the inter-generational traditional solidarity. Besides, since the 1997 crisis, persistence of a high unemployment rate among the young, rise of inequalities and increasing polarization of the society threaten social cohesion. More generally, the South Korean model is challenged under the combined economic, social and political pressures, presenting an endogenous (continuous rise in unemployment, new demographic trends, emancipation of women, increased democratic requirement, rise in individualism and liberalism) and an exogenous character (entry into the world trade, opening and liberalization of markets, avatars of inter-Korean dialogue, rise in power of China and other Asian neighbours).

 

Some of these trends have begun to outline a favourable context for an increasing role of social economy to cater to the emergence of new requirements, like it has been observed in most of the European countries. Some health cooperatives have been created based on Japanese model, more and more associative structures are set up in relation with elderly care or child care, a work integration scheme for disadvantaged was set up based on the social enterprise concept, the rising influence of environment movements introduces new constraints and inspires more and more public projects like, at Seoul, the rehabilitation of the Chonggyechon river or Seonyudo islet or even the creation of a new network of bicycle paths, the boom of well-being has given a visibility to biological products’ cooperatives that had invested this sector some twenty years ago while remaining very confidential. In the domain of socio-economic policies, a readjustment between economic development and social protection is being witnessed or, in other words, between growth and distribution: in this regard, the country has indisputably undergone, via Japan, influence of European models of the social-democrat type where equity and social justice are central concepts. South Korea consequently chose a very different direction from that advocated by the liberal model and finds itself with a more extensive system of social protection than in the United States and in most Asian countries. This is a real change of paradigm that thoroughly modifies the social practices and the balance between family, State, market and civil society. With the explosion of what one called the « citizen movements » (simin undong) after the end 1980s democratization, the number of associations has been estimated to have doubled during the ten years gone by and 21% of adults of more than 20 years declared having practiced voluntary work in 2005. The civil society has become an important player of the political debate and the different governments that came one after another since fifteen years tried to position themselves with respect to this new force of influence as testified by their political slogans: « Civilian Government » (Kim Young-san, 1993-1997), « People’s Government » (Kim Dae-jung, 1998-2002), « Participatory Government » (Roh Moo-hyun, 2003-2007).

 

However, all these civil initiatives are not homogeneous and are mainly part of an ideological opposition between those emphasizing on finding a social-democrat way (a line to which the most influential citizen movements subscribe) and those advocating joining a more pragmatic modernity of liberal inspiration (especially one part of protestant churches bringing together close to 20% of the population, according to the national census of 2005, are in line with this vision). Besides, the long interventionist tradition inherited from Confucianism, struggle to understand that a support from public authorities, that is often required for the perpetuation of several initiatives of social economy, is not accompanied by a strict control by public authorities. However, the social economy can usually develop its traditional virtues of flexibility, of mobilization of solidarities and generosity only if the State allows it the required space for the initiative by supporting it. In the domain of social protection, the advancements carried out towards a model, of especially European influence, that could be described as welfare are thus almost continually foiled by a conception in workfare more and more influenced by a neo-liberal logic insisting on controls and barriers and as a matter of fact limits the efficiency and the extent of the structures. The direction and the content of the social protection system change according to the pressures between those convinced of the necessity of developing social structures with a social-democrat influence and those defending the idea that the efficiency of public spending must be restricted and strictly controlled at any cost.

Corée du Sud : Economie sociale et société civile, L’Harmattan, Paris, 2003, 268 pages

Le développement économique de la Corée depuis la fin de la guerre de Corée in G.Faure (dir.), Nouvelle géopolitique de l’Asie, Ellipses, Paris, 2005, pp 357-390

Social protection in the Republic of Korea: Social insurance and moral hazard, International Social Security Review, Blackwell Publishing, vol 57, 1, janvier-mars 2004, pp 3-18

Explaining the Third-Sector in South Korea, Voluntas, Kluwer Academic,13, 2, 2002, pp 131-147