Recently, a sensational article published by a Hong Kong media outlet has caused a tremendous stir in Chinese society. The article claims that the Chinese government is not only failing to learn from South Korea but is also taking an opposite path. Furthermore, it provocatively asserts that China's actions against South Korea are driving its economy toward an endless catastrophe. This bold report was released by the Hong Kong media in a deliberate manner. 

In relation to this, on September 28, the ghost media outlet South China Morning Post stated that there is a unique way for China and Southeast Asian countries, which are currently unable to find new growth engines and are trapped in the middle-income trap, to rise as advanced nations. This way is to learn from South Korea. The article warns that if the Chinese government continues to ignore this reality, it will face trials similar to those experienced during the late Qing Dynasty.

The media reported last week that the World Bank released its Global Development Report, which shocked Chinese authorities. The report, titled The Middle-Income Trap, pointed out that while most countries successfully progress from low-income to middle-income status, the path from middle-income to high-income is much more difficult and rare. Moreover, according to this report, the economic growth strategy that was effective for South Korea when it was a low-income country—high capital investment—becomes increasingly less effective once a country reaches middle-income status. To move from lower-middle income to upper-middle income, it is necessary not only to have high investment but also to import technology and widely disseminate knowledge. The Hong Kong media noted that the transition from middle-income to developed country status is much more challenging, and to address this, countries must innovate on their own.

It must be achieved, but countries in China and Southeast Asia have neglected these efforts, and as a result, their challenge toward developed nations is becoming a mirage. Most middle-income countries have yet to transition to high-income status. Despite these countries reaching the upper middle-income level with a per capita income between approximately $4,500 and $14,000, many economies are experiencing a slowdown in growth or even stagnation. Consequently, they have failed to narrow the income gap with Western developed countries, as well as nations like South Korea, Japan, and Taiwan. Therefore, the Hong Kong media pointed out that the recent report released by the World Bank is timely and serves as a wake-up call for the Chinese government, which is struggling to restore investor and consumer confidence, end a three-year real estate slump, and increase productivity. This is the essence of the report.

It has been reported that we must learn well from Korea's development model. This is because the last country to successfully join the ranks of advanced economies in Asia was none other than Korea. The Hong Kong media pointed out that while Korea achieved this accomplishment about 30 years ago, no other major Asian country has entered the high-income category since then. This illustrates how absurd and fictional the predictions made by some economists in the past about the rise of Asia or the so-called Asian century were, especially when considering China's economic growth. In fact, the Hong Kong media highlighted that even Dr. Robert Solow, a late American economist and Nobel laureate, consistently argued that the East was rising while the West was declining. However, when looking at the per capita income statistics of China and Southeast Asia, it starkly confirms that such claims were incorrect.

있다고 보도했습니다. 그도 그럴 것이, 이 매체가 공개한 표를 자세히 보면 1980년대 중소득 국가였던 한국이 1990년대 초반에 빠르게 고소득 국가로 진입한 것과 달리, 중국과 말레이시아를 비롯해 태국과 같은 다른 중소득 국가는 이를 달성하지 못한 것으로 나타나 있습니다. 그러면서 이 매체는 세계 대전 이후 세계에서 유일하게 최빈국에서 경제 선진국으로 발돋움한 한국이 어떻게 중진국 함정을 극복했는지, 중국과 동남아시아 국가들이 제대로 따라 배우지 않는다면 중진국 지위마저 제대로 유지할 수 없는 위기에 직면하게 될 것이라고 경고했습니다. 홍콩 매체는 현재 대부분의 나라들의 경우 한국이 경제 선진국으로 올라선 배경으로 수출 지향적인 산업화와 중공업을 촉진한 산업 정책, 그리고 기술 학습 및 연구 개발과 가계가 생산자를 보조하도록 한 금융 정책의 중요성을 손꼽지만, 

The report states that, indeed, if you take a closer look at the table released by this media, it shows that while South Korea, a middle-income country in the 1980s, rapidly transitioned to a high-income country in the early 1990s, other middle-income countries such as China

It has been reported that an important element has been overlooked: the land reform implemented in 1949, shortly after Korea was liberated from Japanese rule. This media outlet stated that the Agricultural Land Reform Act, enacted in 1949, involved the government purchasing land from landlords at forced prices and selling it to tenant farmers at prices below market value. The Hong Kong media praised the land reform carried out in Korea at that time, noting that it not only became a catalyst for strengthening Korea's national power but also acted as a driving force in reducing income inequality among the Korean people. Through this land reform, the farmers in Korea, who were mostly tenant farmers at the time, were given land at half the price, which provided them with a strong incentive to maximize rice production. Furthermore, this media outlet pointed out that as disposable income increased for Korean farmers due to the land reform, they were able to purchase capital goods afterward.

It was reported that transforming into consumers has become a cornerstone for the development of the Korean economy. In fact, the media reported that when Hyundai produced Korea's first indigenous model, the Pony, it also introduced the Pony pickup truck aimed at Korean farmers for this very reason. However, the media criticized that in China, the situation is quite the opposite. After the Chinese Civil War in 1949, the Chinese Communist Party took measures to nationalize all land, which shattered the motivation of Chinese farmers and drove the Chinese economy down a dark path for decades. Subsequently, the media reported that another key factor in Korea's rise to a developed country was the export-oriented manufacturing industry, which was built on the foundation of land reform. For instance, despite Korea's population being only one-seventh that of Southeast Asia, most of us are familiar with companies like Samsung and Hyundai Kia, as well as POSCO.

There are more globally successful South Korean manufacturers than those from Southeast Asian companies like Daewoo and Ssangyong. The media reported that South Korea's success in transitioning from a low-income to a high-income country in just two generations was due to these South Korean companies producing high-value-added products for export. It noted that during the rapid growth of the 1970s and 1980s, known as the Miracle on the Han River, the South Korean government, despite international criticism deeming it reckless, invested all of the nation’s resources and even external borrowings to enhance export competitiveness and develop heavy industries and the chemical sector. This approach was entirely different from China's, which poured massive funds into real estate development to quickly revive its economy, leading to high household debt due to suspiciously valued investments in real estate and infrastructure.

In contrast to corporate and local government debt, Korean banks provided almost unlimited discounted loans to exporters, but as long as borrowers continued their exports, loan repayment was possible. Monetary policy has been very loose for decades in Korea, which resulted in mostly double-digit inflation when there were developing countries. However, as long as the real income of Koreans increased, this was not a significant problem. Hong Kong media reported that the Korean government's desperate efforts to nurture heavy and chemical industries, which were aimed at addressing export abuse, not only improved the real income of Koreans but also significantly increased manufacturing jobs with high productivity. Through this, Korea's economic growth rate broke historical records year after year. In particular, the media noted that even during the 1997 IMF financial crisis that swept through Korea and Southeast Asia, Korea's advanced manufacturing industry thrived.

Thanks to the efforts, it was reported that the financial crisis could be overcome in one fell swoop. Korea's manufacturing capacity, during the 1997 Asian financial crisis that struck the economy and caused significant turmoil in the financial system, meant that the sharp depreciation of the won allowed Korean manufacturers to overcome the crisis through exports, leading to a rapid economic recovery. On the other hand, it was praised that the reason Southeast Asian economies, like Korea, could not dare to imitate and rise to become one of the world's leading economic and cultural powers was due to the diversification of export products beyond manufacturing. This is attributed to the fact that, over the past 20 years, Korea has focused on cultural exports such as K-pop and Korean dramas, which not only injected another economic vitality into Korea but also significantly enhanced Korea's international image. Furthermore, the media stated that the Korean economy...

If we summarize the process of advancing to a developed country, South Korea has uniquely succeeded in creating a global economy that is unmatched in Asia. This was achieved through agricultural development driven by land reform, the expansion of export-oriented manufacturing industries, and the subsequent flourishing of cultural industries with the wealth generated by the national finances. Consequently, Hong Kong media pointed out that currently, China and Southeast Asian countries are not learning from Korea's economic growth strategy. Instead, they are relying on cheap labor and focusing on primary industries and light manufacturing. This approach will lead to the hollow echo of advanced country status. Therefore, it is necessary to face this reality with a clear perspective. Ultimately, the report from Hong Kong media highlights our unwavering belief that, despite the grim situation, we can also become the best in the world, showcasing our remarkable economic development that no one could have imagined.

It clearly shows that it has resonated greatly with many countries. If you enjoyed the Guinness Book video, please make sure to subscribe and set up notifications.

"아시아에서 유일한 한국인을 안 따라 배운다고?!" 홍콩매체가 위험을 무릎쓰고 중국경제 비판하는 사상초유 특집보도 내놓자 궁지몰린 시진핑 주석

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