Koreans optimistic about nation’s ‘pivotal state’ vision

[Photo by Kim Ho-young]

Most South Koreans believe that the country has the potential to grow into a “pivotal state” despite internal challenges including a low birth rate and aging population as well as external challenges within the global trend of nationalism.

According to a survey conducted by Maeil Business Newspaper in collaboration with the research agency Mono Research on Monday, 45.8 percent responded that they expect Korea to leap to the level of a pivotal state with a per capita income of $50,000 within the next 10 years. A significant 38.3 percent were optimistic that Korea could become a pivotal state within 6 to 10 years, making it the most common response among respondents, and 7.5 percent of respondents said it could happen within the next 5 years.

But the optimism is accompanied by a crucial condition: the nation must strengthen its growth potential while maintaining a population of over 50 million. Maeil Business Newspaper proposes the “Triple 5” action plans to propel the nation to pivotal statehood, in which attaining G5 status, achieving a per capita income of $50,000, and maintaining a population of 50 million are the core goals.

There was a sense of crisis among respondents that Korea could plunge into an economic crisis unless it comes up with measures to mitigate the population shock. A significant number of respondents predicted that Korea could face an economic crisis within the next 10 years if the total fertility rate, or the expected number of births per woman during her lifetime, stays at the current level of 0.7, with 51.7 percent predicting this scenario. Responses indicating an economic crisis within 15 years if the population shock is not managed were higher at 78.1 percent.

Many believed that a prerequisite for restoring the growth engine was a rebound in birth rates. When asked about the chronic causes of Korea’s low growth, 27.7 percent pointed to low birth rates and an aging population, followed by the absence of new growth drivers at 25.3 percent, labor market rigidity at 20.2 percent, tax burdens on households and businesses at 11 percent, business regulations at 8.9 percent, and an education system that fails to foster creative talents at 6.9 percent.

“The younger generation is not accepting the policies based on the high-growth model led by the previous generation,” Hanyang University professor Jeon Young-soo said, suggesting social reforms “by changing the growth model from the past high-growth model to sustainable growth and incorporating young people’s voices into policies.”

Former Korea University president Lee Pil-sang stated the $50,000 income per capita threshold would be reliant on effective changes following reforms sought by the government. “The government has set the right direction for structural reforms in labor, pensions, and education, which have not made any substantial progress so far. Whether structural reforms can lead to effective changes will be the key to whether Korea becomes a $50,000-income country.”

The 1,027 respondents to the survey submitted a structured questionnaire via phone calls, faxes, and emails between December 14 and 18, 2023. The margin of error is ±3.05 points at a 95 percent confidence level.