Bilateral economic cooperation with China has accelerated since the establishment of diplomatic relations in 1992. China is of paramount importance in terms of trade and investment flows. Korea-China economic relations have mirrored the dynamic development of China. But the model of using Chinese low-wage labor as part of a wider East Asian production network has reached a critical junction. Companies engaged in simple manufacturing processing are being forced to relocate or shut down. Large investments tend to be made in “high value-added” industries in China, from manufacturing to services in finance, logistics and real estate. This structural change in China requires the need for prompt and consistent actions in response.
Source : SaKong, Il and Koh, Youngsun, 2010. The Korean Economy Six Decades of Growth and Development. Seoul: Korea Development Institute.
