Pestel analysis of south korea

1. PRESENTED BY:- GROUP NO. 7
SURAJ KUMAR MEHER
GANESH KUMAR PANIGRAHY
DIBYA DARSHI HARAPRASAD JENA
NANDINI BID
JAYASHREE GAN
AMRITA SAHU

2. INTRODUCTION
 South Korea, officially the Republic of Korea, is a
country in Eastern Asia occupying the southern
half of the Korean Peninsula
 The government system is a republic.
 South Korea is one of the most densely populated
countries both in Asia and in the world.
 The Korean people are one of the world's most
ethnically homogeneous nationalities.
 About 15 percent of South Korea's labor force are
employed in agriculture, forestry, and fishing, and
25 percent in manufacturing. Various types of
government employment supply most of the
nation's remaining jobs.

3. POLITICAL FACTORS
 South Korea had a turbulent political past,
characterized by frequent changes in government,
little political freedom and military coups.
 There is a high-degree of political violence in the
country and relations with North Korea continue to
be tense. This is costing South Korea both
economically and politically.
 Korean democracy is successfully consolidated.
 The politics of south Korea takes place in the
framework of a presidential representative
democratic republic.

4. CONT…
 South Korea elects on national level a head of state –
the president – and a legislature.
 The main political parties in South Korea are the
liberal Democratic Party of Korea (lit. "Together
Democratic Party", DPK), the conservative Liberty
Korea Party (LKP), the centrist People's Party (PP), and
the left-wing Justice Party (JP).
 Party realignment is a regular fixture on the Korean
political landscape.
 South Korea has a multi-party system

5. SOCIO-CULTURAL
FACTOR
 South Korea has one of the highest wage levels in Asia
 After the Korean War, rapid industrialization takes
place where a massive population shift from rural to
urban areas
 South Korea has one of the lowest fertility rates in
world. The total fertility rate was as low as 1.28
children per woman compared to 1.75 in China and
2.81 in India
 The unemployment rate in South Korea is one of the
lowest in the world
 increased awareness of human rights

6. CONT…
 South Korea supports religious freedom
 ‘Kimchi’ is the national dish and is eaten with most
meals
 The national drink of Korea is ‘Soju’, a clear vodka-like
drink that is generally 18-25% alcohol
 48% of all exports are electronic
 31% of exports are transport related (cars, boats, etc)
 Women are considered more independent than their
male

7. Current strengths
• Robust telecom sector
• Presence of large global and domestic players
Current challenges
• Scarce natural resources
• Rising R&D costs
Conceptual Frameworks of Technology and Business Systems:
International market/technology environment:-
 A technology trajectory made up of three stages: fluid, transition, and specific
 Acquisition of “packaged” foreign technology, assimilation of foreign technologies ,
improvement of process and product technologies
National technology system:- Policies linking demand and supply
Firm-level organization and management:-
 Two organizational subsystems are of critical importance in the development of
technology: the production site (the factory or plant), and the R&D laboratory
 Crucial role played by chaebols

8. Technology and Business System in Action in the Electronics Industry
The Beginnings :- First electronics producer -GoldStar , assimilating the product design and assembly operations
was simple.
Televisions :- LG Electronics- the first and largest producer.
The role of the government:- Created an electronics industrial park.
Color televisions:- The color TV became the next target for development.
Microwave ovens:- By 1994 Samsung was the world’s second largest producer, manufacturing four million
ovens in Korea and 0.8 million more abroad each year and accounting for 17% of the global market.
Semiconductors:- Korea’s semiconductor industry, now one of the country’s most dynamic industries, had its
beginnings in the mid-1960s, when several multinational semiconductor firms -- began assembling discrete
devices in Korea to take advantage of its low labor costs.
TFT-LCD Development:- development of TFT-LCD or flat panel display illustrates how Korean firms have
strengthened their technology capabilities to emerge as innovators in world markets.
Medison Company:-
 A rapidly growing high-technology firm
 The government played three important roles in Medison’s success: R&D supporter, venture business
financier, and market creator

9. The Asian Crisis and Korea’s Business System in Transition
The role of the government:- Two factors made it difficult for the government to play an
effective developmental role- corruption and the economic power of the chaebols
The restructuring of the financial sector:- A tool of collusion between the government
and chaebols, resulting in a major resource misallocation and huge non-performing
loans which leads to introduction of modern market-oriented banking techniques and
transparency in operations.
SMEs in transition:- SMEs face real problems in the Korean business system-- barriers to
the growth of entrepreneurial, enormous transaction costs
Foreign Alliances on rise:- Developed extensive global networks with firms that have
provided capital goods, technology licensing, and OEM orders and become major
source of technological learning for Korean firms.

10. South Korea
environment:-
 The environment of South Korea is the natural
environment of the South Korean nation.
 Large mammals such as tigers, bears, and lynx
were once abundant throughout the Korean
peninsula. However, they have virtually
disappeared due to human settlement, loss of
forest habitat, and over-hunting.
 The national flower of South Korea is the
Hibiscus syriacus, a species of hibiscus that
blooms continually from July through October.

11. Environmental
issues:-
 Global climate change (South Korea is the ninth
largest emitter of carbon dioxide)
 Air pollution (South Korea ranked 173rd out of 180
countries in terms of air quality.)
 Forests and erosion
 Animal welfare and rights
 Water pollution
 Acid rain
 Drift net fishing
 Wasteful packaging of consumer goods

12. LEGAL ANALYSIS
Current strengths
 Regulatory incentives
 Favorable tax policies
 An exclusive constitutional court
Current challenges
 Absence of juries
 Inefficient customs operations

13. CONT…
Future prospects
 Judicial system similar to USA and Germany
 Advantage of tax abatements and tax treaties for FDIs
Future risks
 Judges quitting for private practice
 Low rate of students clearing the law examination

14. JUDICIAL SYSTEM
 The government of south Korea is divided into 3 branches.
 Judicial branch operates at both the national and local
levels.
 It is a constitutional democracy.
 All judicial training is provided through the judicial
research and training institute.
 Judicial branch is headed by the constitutional court.