Confucian Economics at work in Korean Unification
A preview of a lecture to be presented this month at SAIS
By Dr. Patrick Mendis

As I was leaving Seoul in the spring of 2000 after my teaching tour with U.S. service members in the Yongsan Military Base and the Demilitarized Zone (DMZ), South Koreans were overjoyed about the prospect of unification of North and South Korea. 

The volatile situation still continues as the six-party negotiators for the denuclearization of North Korea are still forging ahead, even with the alleged revelation that North Korea is involved in the Syrian nuclear program. 
While the global community engaged in political reconciliation and diplomacy, the power of Confucian economics seems to be increasingly at work.

What Confucian economics?

Long before the Korean peninsula became a battle ground for proxy ideological war between major powers, Korean people cherished a unified heritage bound by cultural values and Confucian work ethic. South Korean leaders used and misused such Confucian teachings – order, authority, and the respect for elders – for greater economic prosperity while North Korea bogged down with Communism.
 
Connected by Train
In and outside classroom, I felt South Korea’s economic dynamism and enthusiasm – my Korean students are eager to learn and appreciate innovation and modernity, especially the Western life-style. 

Their newly built high-speed Gyeongbu rail, which connects Busan and Seoul in less than two hours, was inaugurated in 2005.  It is Korea’s national pride and a testament to their technological advancement, which is in parallel with the super-speed French TGV and the Japanese Shinkansen bullet trains.  

With the Gyeongbu railway system, the Korean peoples’ explicit ambition is to make Busan similar to that of Singapore and to create a gateway to the global marketplace.

Most importantly, however, the implicit motive is to link up North and South Koreas as a “unified” peninsula with common aspirations, which are driven by economic necessity and trading ambition.

The railway ends at the heavily-guarded Kaesong Industrial Park in North Korea, just 40 miles north of Seoul and six miles from the DMZ.

Economic Strategy
This special economic zone in Kaesong covers 25 square miles and is run by Hyundai Asan, a division of Hyundai.  It is home to 500 South Korean managers and 16,000 North Korean Communist Party workers in Kaesong, the ancient capital of Korea.  In addition, South Korea already has projects in 27 of 206 cities and counties in North Korea.

The South Korean Ministry of Unification plans to complete the project by 2012, accommodating 2,000 companies and employing 700,000 North Koreans. This grand strategy is already a de facto “unification” of the two Koreas that South Korean President Kim Dae-jung and North Korean leader Kim Jong-il agreed to establish in 2002 during their first summit meeting in Pyongyang.

The economic strategy for a possible “unification” is gaining momentum through direct road and rail access to Seoul, Busan, and Kaesong.  The insulated North Korea now has the capacity and transportation network to export and import products through South Korea. 

This comparative advantage is a win-win situation for both countries: North Korean Communist Party workers receive hard currency while South Korean investors gain greater labor cost advantage than competitive China, Vietnam, and other Asian countries.

It is most likely that America is already connected to North Korea commercially despite U.S. economic sanctions and political isolation.

Future Prospects
Former South Korean President Kim Dae-jung maintains vigorously that the Confucian culture is one of the most enduring, if not the only, explanatory factors in their economic growth and rapid industrial development.  Most Koreans believe that cultural heritage should be the driving force that would unite them.

The Kaesong Industrial Park is more than a symbolic economic driver.  It is how China – another Confucian neighbor – gained its economic power before political freedom reigns. When North Koreans have fed more and seen the greater dynamism of the South, the rest seems to take its own course, with Confucian characteristics.

Confucian order and authority are more like to keep them in unity than democratic freedom and diplomacy would.  The six-party negotiators understand the complexity of globalization and the local response from Confucian culture – a new “glocalization” process is indeed at work as it should be.  

 A “unified” and “glocalized” Korea may have the best of all worlds and may eventually find a peaceful solution through Confucian economics.

Dr. Patrick Mendis is vice president of academic affairs at the Osgood Center for International Studies.  He will be speaking about the Korean economic cooperation model based on his recent book, Glocalization: The Human Side of Globalization as If the Washington Consensus Mattered, at 6:45 p.m. on October 18 in the Rome Auditorium.  The book signing and public speaking program is sponsored by the Sejong Society, with the U.S.-Korea Institute