Globalization and liberalization gained momentum during the 1980s. The Korean government actively sought ways to encourage Koreans to go abroad. In January 1983, overseas tours were allowed for the first time, albeit with some restrictions.
Full liberalization of overseas tours occurred in 1989, after Korea had maintained a positive balance of payments for several years and living standards had risen. Following liberalization, the number of tourists from Korea increased to 448,727 in 1990, arise of 235 percent. The numbers continued to increase despite a temporary fall in 1998 due to the financial crisis. The share of tourists among those traveling abroad from Korea was more than 50 percent. The balance of travel payment showed a surplus in 1988, but then fell into deficits after 1991.
Table 4-16. The change in travel expenses (1988-1992)
Liberalizing overseas travel enjoyed widespread public support. Therefore, the government took more steps to eliminate restrictions on overseas travel in 1995. The limit on overseas travel expenses was increased from 5,000 dollars per month to 10,000 dollars per month and regulations on overseas remittances were lifted. In 2001, foreign exchange transactions were liberalized. The purchase of foreign real estate was allowed in 1995, with an initial ceiling of 300,000 dollars. In 2008, the limit was increased to 1 million dollars and the transaction only required notification to, but not the permission of, the government.
Source : SaKong, Il and Koh, Youngsun, 2010. The Korean Economy Six Decades of Growth and Development. Seoul: Korea Development Institute.
