The growth trend of South Korea’s per capita gross national income has reversed, and the gap with other G7 countries except Japan is getting wider and wider. Korean media even pointed out that South Korea’s economy still has a highly destructive time bomb buried in it.
South Korea’s per capita gross national income is far behind that of other G7 countries except Japan. AP pictures
The latest report released by South Korea’s central bank, the Bank of Korea, on the 30th shows that according to World Bank statistics, South Korea’s per capita gross national income (GNI) in 2022 will be US$35,990, which is US$1,710 lower than Italy, the lowest country in the G7.
In 2020, South Korea’s per capita GNI was US$33,040, higher than Italy’s US$32,430 at the time. This was the first time that South Korea’s per capita GNI exceeded a country in the G7. Later, South Korea’s growth reversed. Affected by the epidemic, South Korea’s per capita GNI fell back to Italy in 2021, falling by US$1,020.
Yonhap News Agency lamented that South Korea’s dream of becoming a “G7-level economic power” is getting further and further away. Why has the former “model student of the world’s economy” seen economic growth slow down in recent years?
Multiple internal and external factors have led to the reversal of South Korea’s economic growth. AP pictures
South Korea’s central bank believes that the depreciation of the Korean won and the economic downturn have led to the widening of the gap. In 2022, the annual average exchange rate of South Korean won against the US dollar will be approximately 1,292 won, a depreciation of 12.89% from 2021. The euro used in Italy also depreciated against the US dollar, but the depreciation was 10.97%.
In addition, Italy’s economic growth also exceeded that of South Korea last year. Italy’s real GDP grew by 3.7% year-on-year, while South Korea’s year-on-year growth was about 2.6%. This year, the euro has appreciated and the won has further depreciated. When South Korea’s price increase is lower than Italy’s, South Korea’s nominal GDP will be much lower than Italy’s. Only when South Korea’s economic growth is sufficient to offset the impact of exchange rate and price changes will it be possible to narrow the gap with G7 countries.
South Korea’s “Chosun Ilbo” stated that South Korea, which has been hailed as the “world economic model student” since its economic development plan in the 1960s, has seen its economic growth rate fall below the average level of developed countries in recent years and may degenerate into an “inferior student”. “The sense of crisis is intensifying. The newspaper analyzed that in addition to being affected by external factors such as the restructuring of the global supply chain, successive South Korean governments have been obsessed with populism and failed to carry out structural reforms in the economy, which has also exacerbated the low-growth crisis.
The Organization for Economic Cooperation and Development (OECD) previously predicted that South Korea’s potential economic growth rate this year and next year will be 1.9% and 1.7% respectively. This is the 12th consecutive year that the OECD has lowered South Korea’s potential economic growth rate, and it is also the first time that this value has fallen below 2%. South Korea’s “Seoul Economy” analyzed that lowering South Korea’s potential growth rate is like a warning to South Korea.
South Korea also faces declining birth rates and an aging population. AP pictures
Lee Chang-yong, governor of South Korea’s central bank, said that declining birth rates and an aging population have led to a reduction in South Korea’s labor force, causing South Korea’s economic potential growth rate to continue to decline. South Korea needs to carry out structural reforms to make full use of female manpower and overseas workers.
He said that South Korea’s economy is in recession and the next step will be to focus on how to solve the problem of surging household debt. South Korea’s “Central Daily News” stated that 1,853 trillion won in non-performing household loans is a time bomb for the South Korean economy. Once it breaks out, its destructive power will be dozens of times that of the foreign exchange crisis.
South Korea’s “Chosun Ilbo” questioned, “Will South Korea’s manufacturing industry, which has “competitiveness in all fields,” still be like this in ten years?” The article pointed out that last year, the competitiveness of 9 of the top 10 products exported by South Korea to China declined. , the trade surplus that South Korea and China have maintained since the establishment of diplomatic relations may turn into a deficit. The newspaper commented that if innovation is not continued, once the original leading position is overtaken, it will be difficult to recover.
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Narayana Murthy, Xin Weicheng’s grandfather and India’s top business leader, recently said that if young Indians want to see their country realize its economic potential, they need to work 70 hours a week.
Narayana Murthy.
“Young people in India should voluntarily work 70 hours a week.” The words of NR. Narayana Murthy, founder and former CEO of Infosys Technology Co., Ltd., have recently caused a stir on the Internet. A storm of public opinion. Murthy’s wealth is estimated to be more than $4 billion, according to Forbes magazine. He is also the father-in-law of British Prime Minister Simon Sinn.
According to a report by The Hindu on the 29th, although some entrepreneurs such as Bhavesh Agarwal, co-founder of the Indian online ride-hailing service platform “Ola Travel” agree with Murthy’s views, many Indians Launch a lashing out.
“Somehow, our youth have learned bad habits from the West and are not helping the country to develop. India is one of the least efficient countries in the world and unless we improve our efficiency, unless we reduce government corruption to some extent and improve The decision-making efficiency of the bureaucracy, otherwise we cannot compete with other countries.” On the 26th, Murthy said in a YouTube video that India must improve work productivity and young people must assume the responsibility of promoting national progress, “So I ask young people to People have to say, ‘This is my country and I want to work 70 hours a week.'”
According to the International Labor Organization (ILO), about 66% of India’s population is under the age of 35. Murthy believes that if young people want to see India become a global economic power, they must spend more time working.
In the video, Murthy told former Infosys chief financial officer Mohandas Pai that India needs young people who are “strong-willed, disciplined and extremely hard-working” and “now is the time for us to consolidate and accelerate our development.” time”. He also said that India is expected to become “the second largest economy in the world” by 2075 and that in order to compete with countries such as China, Indian young people will have to work overtime – just like Japan and Germany did after World War II.
CNN stated that Murthy’s remarks came at a time when Western countries’ work concepts have undergone tremendous changes. Quiet quitting has become a new trend in the American workplace over the past year, as people decide not to work beyond the scope of their employment.
According to ILO data, India is already one of the countries with the longest working hours in the world, with the average working hours per “worker” being 47.7 hours per week. But for Murthy, who “creates a generation”, this is still not enough. He once said: “Entrepreneurship is a marathon, not a 100-meter sprint.”
Murthy, who was born in 1946, was admitted to the Indian Institute of Technology, the most famous university in India, but because he could not afford the tuition, he could only choose electrical engineering at the slightly inferior University of Mysore. However, he saved enough money to get a master’s degree from the Indian Institute of Technology two years later.
Murthy started a computer company in the late 1970s, but it failed after a year and a half. In 1981, he founded Infosys with six young colleagues. The entrepreneurial capital came from 10,000 rupees (approximately HK$940) of “private money” provided by his wife.
It is reported that Infosys specializes in providing Internet and e-commerce software services and is now a leading company in the Indian IT industry. Murthy was therefore called the “Father of the Indian IT Industry” by the American media.
Although Murthy’s “70-hour work system” has been recognized by some entrepreneurs, it has still been criticized by many parties in India. A software engineer in Bangalore told The Hindu that this system is equivalent to working six days a week and working an average of nearly 12 hours a day. Such a crazy work system does not leave any space for individuals and families. The US “Business Insider” website reported on the 28th that Indian technology entrepreneur Gondal wrote on social platforms: “While hard work is important, working 70 hours a week can be exhausting and stifle creativity.”
“The Hindu” reported that the “70-hour work system” actually already exists in some industries in the country. Human resources experts say that in industries such as IT, finance, insurance and pharmaceuticals, overtime is a daily norm. In the gig industry, many workers are forced to work more than 12 hours a day.
In addition, the “70-hour work system” will also bring career difficulties to women. A 2019 survey found that Indian women spent nearly 300 minutes a day on housework and 134 minutes on caring for others, compared with only 97 minutes and 76 minutes for men. Some female netizens said that Murthy was actually “driving women out of the workplace” because “men will never share the burden of housework and caring for and raising children.”
2023-10-31 03:11:35
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