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Development Overview

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Overview of Korea’s development experience

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Development Overview
Official Aid Production

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Production

Aid received for agriculture

Development Aid
 
1. Agriculture
 
Agriculture was the top-priority concern of development aid sources throughout the 1950s, the period of postwar reconstruction for Korea. As the Korean economy was heavily dependent on agriculture, with the majority of its working population deriving subsistence and income from that industry, the recovery and enhancement of agricultural productivity was the most pressing task in Korea as far as food supplies and basic needs were concerned.

Much of the early development aid for Korea was thus poured into the agriculture sector, with this pattern persisting until the start of the decades of development.

The government-source-based development aid provided for Korea until 1960 amounted to USD 2.94 billion, USD 1.23 billion (41.9 percent) of which went toward agricultural produce and commodities for the primary sector that Korea received from the United States under Public Law (PL) 480.
 
<Aid for Agriculture>
(Unit: USD 1,000)
 

Source Total aid (1945-1960) (A) Aid for agriculture (B) Proportion (B/A, %)
Bilateral (US) 2,356,285 989,118 42.0
GARIOA 502,097 129,576 25.8
ECA 109,164 37,307 34.2
ICA 1,587,302 664,513 41.9
PL480 157,722 157,722 100.0
Multilateral (UN) 579,462 239,654 41.4
CRIK 457,378 214,297 46.9
UNKRA 122,084 25,357 20.8
Total 2,935,747 1,228,772 41.9
 

Source: The Agricultural Yearbooks, National Agricultural Cooperative Federation, 1960 and 1961.
 
The proportion of development aid for agriculture, which reached its peak at 64 percent in 1953, gradually decreased over time, but still hovered well above 40 percent as late as 1960. Agriculture was the largest recipient of development aid throughout the 1950s because the International Cooperation Agency (ICA) of the United States, by far the biggest source of assistance for Korea, had provided aid that consisted in large part of fertilizers, raw cotton, and other primary agricultural goods, and because Korea had begun to import surplus agricultural produce from the United States under PL480.

Aid from the United Nations Korean Reconstruction Agency (UNKRA) focused more on postwar rebuilding than agriculture by comparison. Agriculture, nonetheless, was the top-priority concern of the ICA after Washington decided to provide project and non-project assistance alike for Korea.

Once the decades of development dawned in Korea in 1960, the country began to receive diverse types of technological aid for agriculture and fisheries under the UN Development Program (UNDP). Agriculture, in particular, claimed 60 percent of all aid provided by the UNDP in the 1960s. Of the USD 27.3 million that the UNDP provided for 36 programs between 1962 and 1971, USD 16.2 million (12 programs) went to agriculture. The UNDP’s agricultural support continued well into the 1990s, amounting to USD 23.7 million (30 programs) of the USD 95.4 million provided in total to be divided among 249 programs. The UNDP provided these forms of assistance to transfer various farming techniques to Korea and also to support the development of relevant education and policies in the country.

The Japanese Reparation Fund for Korea was another major source of agricultural aid from the mid-1960s onward. While the Korean government did spend some of the JRF set aside for agriculture, forestry, and fisheries on major national projects, such as the construction of Pohang Steel Mill, much of the appropriated fund did go to developing waterworks for farms and other agriculture-related programs.

The United States provided not only surplus agricultural produce under PL480, but also grains via the Food and Agriculture Organization (FAO) and the World Food Program (WFP). WFP aid programs, which began on a small scale in 1973, saw their scope gradually expand to 76,344 tons (worth USD 24.2 million at the time) of wheat flour provided for Korea between 1976 and 1979. The proceeds from selling this wheat flour helped to build 3,983 public taps and 55,200 hygienic wells in remote, rural areas.[1]
 

 
[1] The 29th World Health Assembly Collection, Ministry of Health and Society, 1976, p. 41.

Source: Korea International Cooperation Agency. 2004. Study on Development Aid and Cooperation for South Korea: Size, Scope and Exemplary Effects. Seoul.