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Social Infrastructure

World Bank Support for educational development

World Bank Support for Educational Development
 
Between 1969 and 1999, Korea continued to take out public loans for educational development purposes. In fact, not a single educational development project took place in Korea during this period without it being attached to some kind of public loan (Attachment 1). Though a single loan project typically required five to seven years to complete, the Korean government continued to take out one loan after another, with the cumulative number of educational loans multiplying explosively in the early 1980s and the early 1990s, and several educational loan projects taking place simultaneously each year.

Such loans, though they were many, were appropriated by the Korean government in a rather selective manner, particularly with respect to the objectives, sources, and target beneficiaries of the loans.
 
<Figure 3> Number of Loan Projects and Amounts of Loans Executed and Spent Each Year
 
First, Korea took out educational loans for a specified range of purposes and objectives. The 12 educational loans that Korea secured from the World Bank can be divided into two groups according to their purposes. The first group includes the four loans, provided from 1969 to 1977, for vocational education and training in secondary schools, aimed at producing skilled workforces. The second group concerns the eight loans, secured between 1980 and 1994, for providing advanced science and technology education to foster future generations of science and technology experts (Attachment 1). The first group constitutes the first phase of Korea’s educational loan history, and the second group, the second phase. Such educational projects were executed without much interruption, given the simplicity of the objectives involved. Further, they were rather single-handedly overseen by either the Ministry of Education or the Ministry of Labor, thereby avoiding the complications and delays that commonly arise in developing countries when multiple organizations and departments attempt to handle projects in an atmosphere lacking efficient administrative institutions or systems. These loan projects, moreover, were neither subject to much political or social controversy nor did they require the creation of additional institutions for their execution. The projects could be completed successfully within specific time periods because they simply involved the purchase of necessary equipment and the training of teachers.

Second, though Korea did secure some educational loans from multiple sources, especially from 1979 to 1982, and from 1986 to 1988, throughout the three decades from 1969 to 1999, the dominant source of such loans was the World Bank. This policy of sticking with one source of development aid enabled that source to accumulate knowledge on the details and history of educational projects in Korea; helped to minimize trial and error costs; and ensured more effective project monitoring.

Third, over 90 percent of all Korea’s educational loans went toward purchasing equipment and materials from abroad—since most were unavailable in Korea at the time—with less than 10 percent earmarked for teacher training and inviting foreign experts. These educational loans therefore helped to alleviate the burden of foreign reserve shortages, a common problem plaguing developing countries. Moreover, insofar as the efficiency of the purchase procedure was ensured, these loan projects could be executed and completed efficiently as well.

In sum, the Korean government continued to borrow relatively small sums of money, for simple objectives, from the same single source, repeatedly. This helped to minimize the risks of failure and to maximize the learning effect for both the donor and the recipient.
 
 
Attachment 1. Education Loans for Korea (1969 to 1999)
 

Serial no. Year approved Final year Source (loan no.) Objectives Description Loan amount (USD 1 million) Total project cost (USD 1 million)
1 1969 1976 IDA Education Loan I (151) Creating and improving vocational high schools, colleges, and universities to increase technically skilled workforce Providing equipment as well as teacher training for 4 universities, 5 vocational colleges, and 27 vocational high schools 14.8 26.8
2 1973 1979 IDA/IBRD
Education Loan II (394/906)
Creating and improving vocational high schools and colleges to increase technically skilled workforce Providing equipment, facilities, and teacher training for 33 vocational high schools, 10 vocational colleges, and 43 universities (for engineering, marine and fishery, and nursing departments) according to the Reformed Healthcare and Management Education Plan 43.0 70.2
3 1975 1980 IBRD
Education Loan III (11096)
Creating and improving vocational high schools, colleges, and training centers to increase technically skilled workforce Providing equipment as well as teacher training for 6 vocational high schools, 3 agricultural colleges, 1 marine college, and 7 vocational training centers 22.5 39.1
4 1977 1984 IBRD
Education Loan IV (1474)
Creating and improving vocational training centers to increase technically skilled workforce Providing equipment for 8 vocational training centers and 1 teacher training center 23.0 56.2
5 1979 1983 USEXIM Creating and improving educational and medical facilities to increase skilled workforce and medical professionals Providing medical and lab equipment for 95 industrial high schools, industrial colleges, 16 surgical colleges, 5 dentistry colleges, and 5 university hospitals 98.7 98.7
6 1979 1984 ADB Education Loan I Creating facilities and ships to increase workforce skilled in marine and fishery technologies Supporting the construction of 1 harbor, as well as the building of 12 large ships, 2 fishing ships with nets, 2 transport ships, 25 diesel engines, and 8 practice ships, and providing equipment for 3 marine and fishery colleges, and 5 vocational high schools 4.5 4.5*
7 1980 1984 OECD
Education Loan I
Creating and improving educational and medical facilities to increase skilled workforce and medical professionals Supporting education, experiments, practical training, and laboratories at 12 private medical colleges and 1 engineering college 47.6 47.6*
8 1980 1985 IBRD
Education Loan V (1880)
University Technology Education Sector Program
Providing increased teacher training to produce professional and skilled workforce, and decreasing gap of investment between public and private schools in terms of advanced technical education Expanding and providing lab facilities and equipment as well as teacher training for 27 universities and 27 vocational colleges 100.0 100.0
9 1981 1985 OECD Education Loan II Increasing and improving advanced science education to augment workforce specializing in basic science research Providing lab and practice equipment and materials for basic science research at 25 private universities 28.0 28*
10 1982 1985 UKECGD Increasing and improving advanced technical education to increase professional and skilled workforce Providing lab and practice equipment and materials, as well as faculty training, for 10 agricultural colleges, 6 pharmaceutical colleges, and 3 marine and fishery colleges 35.0 35*
11 1984 1988 IBRD
Education Loan VI (2427)
Science and Technology Education Program
Increasing and improving science and engineering education, as well as graduate education and secondary (lab-oriented) science education, to produce science and technology researchers Creating 13 student science centers via Education Commission for 18 national and public universities, 20 private universities (natural science and teaching departments), engineering and science graduate schools, and 13 other student science centers for 4 science high schools, 9 high schools affiliated with teachers’ colleges, and 123 public and private high schools 100.0 695
12 1986 1989 OECD Education Loan III Increasing and improving education and research facilities to produce science and technology experts and medical professionals Providing equipment and materials for medical, engineering, dentistry, and the affiliated hospitals of 32 national, public, and private universities, as well as 1 vocational high school 49.3 49.3*
13 1987 1995 ADB
Education Loan II
Creating educational and research facilities to increase workforce skilled in marine and fishery technologies Providing research and training equipment and materials, including 2 marine training ships, 5 fishery training ships, and 1 marine explorer, as well as teacher training for 6 universities and 1 vocational high school 53 53*
14 1988 1991 OECD Education Loan IV Increasing and improving education and research facilities to produce science and technology experts Providing equipment and materials for engineering, medical, dental, agricultural, pharmaceutical, and special education and astronomical observation at 28 national and public universities, 15 offices of education, and 23 private universities 72.8 72.8*
15 1988 1992 OECD Education Loan V Increasing and improving education and research facilities to produce science and technology experts Purchasing research equipment and materials for graduate schools and departments for science and education (at 30 national/public universities and 6 private universities), 3 private colleges, 1 open university, 1 home education-based university, KEDI, and KNOU 38.9 38.9*
16 1988 1995 OECD* Education Loan VII Increasing and improving education and research facilities to produce science and technology experts Providing 5 practice ships and 2 transport training ships for 1 marine-fishery high school and 6 universities 15.0 15*
17 1991 1995 IBRD
Education Loan VII (3203)
University Technology Research
Reinforcing science teacher training to produce researchers specializing in basic sciences and to enhance both research capacity and secondary science education Expanding and improving facilities at 37 public and private universities (focusing on engineering, science, teaching colleges and research centers) 45.0 60
18 1992 1996 IBRD
Education Loan VIII (3314)
Vocational High School Education
Reinforcing education at vocational high schools to increase skilled workforce Improving lab and training facilities at 3 vocational high schools and 15 municipal and provincial offices of education (supporting 347 engineering, agricultural, business, and marine and fishery high schools) 30.0 43.3
19 1992 1997 IBRD
Education Loan IX (3468)
Science Education and Library Computer Network
Improving quality of science education at secondary schools and enhancing university capacity to gather academic information Providing equipment and materials for inter-university library network encompassing 45 universities and 15 offices of education (supporting 61 schools) 50.0 81.7
20 1992   IBRD
Education Loan X (3469)
Vocational High School Development
Reinforcing education at vocational high schools to increase skilled workforce Providing lab and training equipment and materials, as well as a reform plan 30 48.4
21 1993 1998 IBRD
Education Loan XI (3612)
Environmental Research and Education
Improving and enhancing environmental education at universities Providing lab and training equipment and materials for 14 agricultural, marine and fishery, and medical colleges 60 97.3
22 1994 1999 IBRD
Education Loan XII (3693)
Science and Technology Education
Improving and enhancing science and technology education as well as research capacity to help improve the devising and implementation of policies on science and technology education Providing lab and research equipment and materials for 124 organizations (49 universities, 8 open universities, 8 vocational colleges, 19 vocational high schools, and other training centers) to boost basic science and technology education and research 190 324.8
Total 1969 1999  Education and training loans total (from World Bank)
(Proportion of World Bank loans)
    1,151.1
708.3
62%
2,242.8
2064
92%


Source: Lee, Kye Woo and  Min, Yujuana. 2010. The Korean aid policy for the educational sector: Future direction. International and regioonal research 19(1). Seoul National University.