URBAN AND INFRASTRUCTURE POLICY: Lessons from
South Korea
Dr. Saumitra Mohan
In the rat race of development in an
increasingly globalised world, resort to a trade-off between improved quality
of life and systematic destruction of the natural habitat including land and
environment often become unavoidable. Rapid urbanization and economic growth
are visibly apparent everywhere today, but so are varied urban environmental
problems in overcrowded cities. The complexity of the issue is ever-growing
because slowing economic growth is not a favourable solution, but sustainable
urban development is still a viable possibility.
It is in this context that South Korea appears to be a shining example
of sustainable development despite initial compromises with the environment. Rapid
development has enabled South Korea to catch up just in time with the demands
of a globalised world, but at the cost of environment. However, specific initiatives have been taken as part of
a conscious effort to move towards a sustainable development where modern
technology has played a great role. And we were all witness to the magical
turn-around in the South Korean economy from a Third World authoritarian
country to a modern and prosperous liberal democratic state which has balanced
the demands of economic growth with the requirements of the environment.
The Republic of Korea experienced an
unprecedented increase in the rate of urbanization over the past 40 years since
the end of the Korean War. The level of urbanization rose drastically from 35.8
percent in 1960 to almost 90 percent today. A combination of socialist and
capitalist economic policies has spurred this industrialization. Since the
1960s, the government has been consciously pushing for an export-oriented
development paradigm. A well-planned and strongly executed developmental
framework has made South Korea what it is today i.e. a developed country with equitable
regional growth.
In its drive for fast economic development,
South Korea was helped by its cultural and ethnic homogeneity. The monolithic
and mono-chromatic social profile was further reinforced by the desperation and
helplessness of the South Korean citizens, buffeted and ravaged by a
debilitating war with North Korea during 1950-53. Against this background,
South Korea started out to focus on the human resource development of its
population as well as a revolutionary land reform which later turned out to
provide a solid foundation for its future economic growth. Its thrust on
inculcating the values of self-dependence and discipline among its citizens
through its innovative policies a la Saemaul Undong or the New Village Movement
and firm execution of the same also helped its aspiration.
South Korea’s New Village Movement was an
ingenuous effort to curb the widening rural-urban divide. This pioneering
policy by the South Korean government attempted to foster community empowerment
where performing villages were given incentives and support in terms of
expertise and resources to help themselves in building agrestic infrastructures
while non-performing villages were not encouraged. In the 1970s, the government
provided each of 33,000 villages with 335 bags of cement and other materials to
use the same for the good of community. The performers were encouraged while
the non-performers were told to pull up their socks to deserve governmental
support. Simultaneously, the government also attempted to curb the tendencies
for rent-seeking and corruption by resorting to strong measures which later
impacted its growth story positively.
The committed and visionary South Korean
leadership also laid foundation for its balanced industrial growth by focusing
on certain core industries namely heavy and chemical industries though one
would also hurry to add that as a country, South Korea also benefited from the
Cold War politics. South Korea carefully sided with the US camp after North
Korea was attached to the coattails of the then Soviet camp. Its loyalty to the
US even during the Vietnam War stood it in good stead by ensuring a steady flow
of capital, resources and technical expertise to build itself from the scratch.
The somewhat enlightened but autocratic leadership ensured that South Korea
make the best of available circumstances and resources to achieve a place in
the development sun for itself though its citizens did lose their basic
liberties and civil rights during the first thirty years of its developmental
odyssey.
South Korea, during this period, laid stress
on meritocracy and incentivized its citizens and industrial houses through a
policy of carrot and stick. However, in its urge for rapid growth and
development, many corners were cut thereby resulting in compromises with the
environmental desideratum. The urban landscape, even though filled with the
billowing smokes and roaring factories, became uglier making the cities
inhabitable. Hence, the South Korean government thoughtfully put in place
measures to control unplanned urban growth by way of earmarking a greenbelt,
built around the city of Seoul in the 1970s. Seoul's greenbelt now measures
about 1,566.8 km2, which accounts for about 13.3 percent of the Seoul
metropolitan area.
The greenbelt, as visualised, is essentially a
"belt" of greenery surrounding the city limits which was aimed to arrest
unplanned urban growth and create an infrastructure which would be in harmony
with nature. Through this initiative, a positive effort was made to ensure a
healthy quality of air and water for the local citizens. The complexities of
urban planning require the authorities to cover a wide range of concerns,
intertwining with social, economic, and environmental sectors of the city. And
the South Korean government has ensured the same quite successfully.
South Korea’s ‘Ubiquitous
City or U-City’ model intended at sustainable urban development was an epochal
initiative involving cutting-edge technology to improve the quality of city
life. Technology including high-speed internet was harnessed to ensure better
access to the urban amenities which would not compromise the environment. The
same also ensured a well functioning water supply system, transportation and a
city surveillance system which would become the foundation of a safe and secure
urban life for the South Korean citizens. The entire gamut of technological
innovations provide a facile and high-speed access to smart services and
information from anywhere in the urban conglomeration. We were witness to an
operational state-of-the-art drinking water supply system and a very modernized
transportation system. The micro-planning of each and every nuance of a public
facility was really awesome and worth emulation in our country though the same
was also very capital-intensive.
The futuristic
‘ubiquitous infrastructure’ provides everyone with an opportunity to access
urban infrastructure and services regardless of time and location by using
information technology devices as was very much visible during our visit to
South Korea with its citizens interfacing with the technology on almost
real-time basis. Similarly, another initiative namely U-infrastructure also has
a significant implication for the emergence of a new paradigm for urban
infrastructure planning which is ecologically sustainable and democratic in
nature though one does feel that too much of dependence on technology may
sometime prove prejudicial to the larger interests of a thriving society. South
Korean cities like Seoul have become the world leaders today in the use of ICTs
(information and communication technologies) in urban infrastructure planning
and management.
The most encompassing
of these technologies include the broadband convergence network. The
interactive technologies hooked to the high-speed internet allow any device the
ability to access information from the embedded devices within the specially
designed system. The Personal Travel Assistant System (PTA) is another
people-friendly initiative which delivers real-time information about public
transportation including routes, arrival-departure timings and other eco-friendly
options. This emission-free transportation system has greatly reduced the urban
congestion in major urban cities of South Korea including Seoul.
The U-City model
aptly addresses the sustainable development issue by focusing on a
nature-friendly lifestyle. The urban residents in South Korea today have access
to high-speed services and amenities through World Wide Web. It embodies the attribute
of the ideal futuristic city in which public life is secured by way of a safe
and secure environment through state-of-the-art technologies.
MUNICIPAL WASTE
MANAGEMENT
High-income countries
in East Asia, such as Japan, Hong Kong, and South Korea, with GDP per capita
ranging from 23,331 to 37,385 USD, produce more wastes than countries with
lower GDP such as India and Vietnam. As a part of the green infrastructure, eco-friendly
municipal waste management is now possible using cutting-edge technology and
practices. Municipal solid waste, or MSW, is a by-product of daily human life
that is now being addressed by individual municipalities in South Korea. The
composition of MSW varies greatly, but much of it is combustible into ash,
while non-combustible materials such as glass and metals are shredded and
recycled.
Most of the South
Korean cities including Seoul metropolitan city exemplify the futuristic
municipal body which utilizes high-end technology to improve the lives of its
citizens and reduces municipal solid wastes in a way that improves the
environment and benefits the local government. The ‘waste-to-energy’
incinerators generate sufficient electrical power, converting large volumes of
trash into useable electricity. However, the whole combustion system still
produces nefarious carbon emissions. In order to alleviate the amount of
greenhouse gases emitted from the facilities, modern technologies have been
harnessed to control the high level of emissions being released into the environment.
Besides, South Korea has also successfully turned around most of its polluting
dumping grounds into eco-friendly Nature Parks as showcased to us during our
site visits in Seoul city.
INFRASTRUCTURE:
The 1950-1953 Korean War destroyed much
industrial infrastructure, and Korea had to start re-building itself from the
scratch. As is well-known, the Korean economy was heavily dependent on foreign
aid till 1961, with an unemployment rate of 25 percent and a per capita income
of less than $100. However, just half a century later, Korea has become the
world’s 12th largest economy, transforming from beneficiary to
benefactor of development aid. Today, South Korea is also ranked 11th
out of 148 countries in terms of excellence in infrastructures. At the forefront of this dramatic
change has been the government’s investment in infrastructure and urban
projects. The country’s infrastructure development was propped by an effective
policy support. A very close coordination between its economic development
plan, sectoral plans and budget ensured that the country does not lose focus.
Its focus on following rigorous protocols for selection and evaluation of projects
is very well reflected in the quality of the completed projects.
Since
the early 1960s, South Korea has demonstrated an impressive record of economic
performance. Much of its success stems from a commitment to infrastructural
development. In the period between the early 1960s and the late 1990s, several
factors enabled Korea to realize sizable economic benefits from infrastructure
investments. Strong leadership and efficient coordination for installing the
infrastructure necessary to spur economic performance, a well-defined focus and
priorities on infrastructure for development, and willingness and flexibility
were the critical factors. The South Korean planning and investment in its
human resources and their capacity building also reinforced its infrastructural
initiatives by providing the necessary trained manpower as was needed to
support and sustain these initiatives. Its thrust on vocational training and
quality of its pedagogy was another hallmark of its human resource development
policy.
South
Korea's first Five-Year Development Plan (1962-66) focused on developing the
light industries and an import substitution. Infrastructure to support these
activities included the construction of critical railways and several small
highway projects. The second Five-Year Development Plan (1967-71) sought to
stimulate exports, which grew by nearly 50 per cent per year during this
period. Investment in railways continued, and highway construction also
accelerated. Korea's first major highway project was to connect the country’s
two largest cities, Seoul in the north-west and Busan in the south-east. This
project was particularly momentous because not only did it establish a vital
industrial corridor in Korea, it also served as a symbol of Korea's emerging
self-confidence.
Nevertheless, South Korea’s investment in
infrastructure during the 1960s was certainly not enough. Finding it
increasingly difficult to remain competitive in labour-intensive light
industries, South Korea shifted its focus to heavy and chemical. Starting with
the third Five-Year Development Plan (1972-76), the South Korean government
identified new priorities, policies, and infrastructures needed for giving a
solid foundation to the overall economic development of the country. These
inter alia included petrochemicals, steel and ship-building. Comprehensive
infrastructure development programmes were planned to develop the country's
airports, seaports, highways, railways and telecommunication systems to support
these industries.
Through
the 1980s, South Korea visualised policies that laid stress on economic
stabilization, private sector liberalization and deregulation. The government put
less stress on the heavy and chemical industries and paid more attention to
high quality consumer goods while downscaling government spending.
Infrastructure investment, however, remained fairly high to reach eight per cent
of the Gross National Product in the first half of 1980s. In 1985, the
government started taking several measures to stimulate the economy. The
authorities also established a supplementary budget to stimulate demand and
increase infrastructural investment. All these measures spurred the economic
growth to unprecedented levels.
The 1993-1997 Five-Year Economic
Development Plan visualised a grand programme with emphasis on improved
living standards with upgraded housing, environment and urban traffic. It
also aimed at expanding public transportation as well as development of
communication standards with a view to resolve society's infrastructural deficits.
Securing adequate power was one of the government’s emergent priorities. During
the 1960s, the power generation facilities were unevenly distributed
regionally, resulting in unstable supplies. Many electric power facilities
were destroyed during the Korean War, resulting in regular power shortages.
The Korean government merged three existing electric companies (Chosun,
Kyungsung, and Namsun) on July 1, 1961 to establish the Korea Electric
Company (KECO) to improve the supply of electric power before executing the
economic development plan. As a result, the level of power generation reached
285,223.8 gwph in 2001 from 9167.4 gwph in 1970. Emphasis was also laid on
developing the green nuclear power which today provides a considerable amount
of nation’s power supply. However, it is notable that even with exceptional
growth, South Korea still imports more energy than it produces.
While new information technology
such as mobile phones and the Internet is showing unprecedented growth, South
Korea’s progress in telecommunication sector is still far from satisfactory.
Telecommunication has been the backbone of South Korea’s economic
development. Infrastructures in the social service area, such as medical
facilities and water supply though have had relatively low priority in South
Korea to begin with. However, the development of such infrastructures improved
immensely after the 1980s when the economy started performing well
economically. Much of the momentum for infrastructural investments came
early because of strong political leaders who had huge authority and
autonomy in framing and implementing policies.
The main sources of funding for South
Korea's infrastructural development included taxation, designated funds,
public pension funds, and private funds not to speak of the foreign grants
and loans. Given that most of the needed infrastructural projects are
deemed to be potentially profitable, private financing has been considered
to be one of the better ways to fund them. Better choices for private
funding include industrial estates, freight depots, waste-water and
municipal waste treatment facilities, and local toll roads. Incentives for
attracting private funding include allowing public agencies to acquire
land, pairing marginal projects with profitable projects, arranging long-term
financing from public funds and allowing tax exemptions.
The main thrust of South Korea’s
infrastructure policy has been to judiciously and cautiously encourage more
and more private participation in all infrastructure sectors namely power,
gas, transportation, airports, ports, telecommunications, water and sewage
facilities, by providing tax and other incentives to private investors, and
also by improving the investment selection processes. This includes new
incentives for foreign investors including exemption of 10 percent
value-added tax upon completion of target facilities, government guarantee
of up to 90 percent of operating revenue, bonus for early completion and
permission for excess profit resulting from lower than expected
construction costs, compensation for losses due to exchange rates movements,
acceptance of diversified development modes, increase of the profit level
approved by the government from 10 percent to 18 percent, buy-out option in
the event of franchiser bankruptcy and carefully-planned debt relief
measures.
Transportation services in South
Korea are operated mostly by the private or quasi-private sectors, excepting
railways and subways. The transportation services run by the private sector
function in a fairly competitive atmosphere, and are considered to be
efficient. However, these services are greatly limited in their capacity to
improve their service because of restrictive price controls. Though government
has long been contemplating private sector participation in ports, the same
has been put on hold owing to national security concerns.
High Speed Rail projects are
administered by the Ministry of Construction and Transportation, while all
other railways are run by the Korea National Railroad. South Korea's High
Speed Railway project has been one of the most problematic projects and
suffers from a serious shortage of finances. South Korea's subway system is
managed and operated by the local city governments. The most troublesome
case is the Seoul Metropolitan Subway Corporation (SMSC) where tariffs do
not cover construction costs, and attempts to adjust tariffs have not been
very successful in the past though sustained efforts are being made to make
it profitable.
Thus, for developed and
developing countries alike, the ability to build a knowledge-based
economy depends on their capacity to use the global system of the
generation and transmission of knowledge. To develop such a capacity, the
following elements are required:
1.
Dynamic information
infrastructure to facilitate the effective communication and processing
of information;
2.
Educated population that
can create and use knowledge;
3.
System of research centres,
universities, think tanks, firms and other organizations that can tap
into the stock of global knowledge, adapt it to local needs, and create
new knowledge;
4.
An economic and
institutional regime that provides incentives for the efficient use of
existing knowledge, and
5.
The creation of new
knowledge and entrepreneurship.
Developing a powerful
information infrastructure, therefore, requires the support of the many
stakeholders involved in its use such as government, business, individual
users, telecommunication and information service providers. They must work
together on establishing an information infrastructure strategy that
involves identifying the opportunities and needs for a better information
and communication system in the economy.
As it appears, South Korea’s
emphasis on a balanced regional development with spatio-temporal planning
has provided it a rock-solid foundation for its economic growth which has
made it join the league of the developed countries. South Korea’s
infrastructural development was closely linked to the economic growth
plan where the government identified the specific infrastructural needs
of various regions and executed the same with greater and better
efficiency. The steadfast commitment to high quality infrastructure and
to bridge the rural-urban chasm was also based on a sustainable long-term
vision. Such a policy was also rooted in a vision to maintain the
competiveness in export markets and to support a more balanced
developmental framework.
However, one does feel that
apart from the meticulous planning, implementation of the national policy
and a committed leadership, South Korea does appear to have benefited
greatly from the Cold War politics of the post-World War II developments
by aligning with the camp led by the United States of America. It not
only gained in terms of financial and technological help, but also got to
get away with the democratic deficits of its governance system in its
formative days. Also, the monolithic character of its society ensured
that it did not have much socio-cultural problems to deal with. All this
provided South Korea with a head-start which India could not have thought
of simply because of the complex and diversified nature of its society
and politics and hence, in some respects the two countries do appear
incomparable.
Having said this, one does feel
that all the developmental strides that South Korea has made in the last
few decades and its sterling performance in resolving the existential
problems of its people through an imaginative mix of vision and execution
are worth emulation. South Korea’s performance in such sectors as mass
rapid transport system, solid waste management, ship-building, heavy and
chemical industries, information technology, telecommunication, city
surveillance system and infrastructure is really commendable and many of
these models could be very well replicated in India though the same do
have huge financial involvement. One only hopes that India shall learn
its lessons from South Korea to ensure a better future for its citizens.
*The views expressed here
are personal and don’t reflect those of the Government.
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