This study reviews the current conditions of the electronics industry, one of the major exporting industries of Korea, and identifies its obstacles, suggesting policy measures that can help sustain the industry’s growth.
The electronics industry, one of the newly emerging export-oriented industries in Korea after the radio and black-and-white TV industries, is expected to become the next leader of Korea’s export-based economic growth. Nevertheless, there are many issues facing this industry today, including the increasing competition from the electronics industries of Malaysia, Taiwan, the Philippines, Hong Kong, and elsewhere, as well as the increasingly aggressive policies that the United States and Japan are adopting to address this rising competition from the developing world.
The Korean electronics industry is heavily biased in favor of assembly kits and parts that require significant labor, but offer little added value. As the prices of raw materials and basic parts for electronic goods have been on rise over the last several years, it is no longer possible for the Korean electronics industry to profit from the international market by exporting assembled and finished goods only. Lacking infrastructure, the current assembly-oriented electronics industry in Korea is incapable of the adoption of advanced technology.
Fortunately, the domestic demand for durable goods, such as home appliances, is on rise thanks to the rising level of national income. The Korean electronics industry should therefore focus on developing and improving the 47 goods from 11 categories in which it has specialized so far, including black-and-white and color televisions, amps, condensers, television Braun tubes, speakers, interchangers, transistors, high-frequency coils, polyvaricons, printed circuit boards, tuners, tape decks, and film condensers. Through selective focus and specialization the industry can achieve the desired level of technological advancement as well as structural reforms, becoming more capable of satisfying demand both in and outside Korea.
The Korean electronics industry has been growing steadily over the last decade. The years from 1959 to 1965 marked the peak of radio manufacturing, which was succeeded by the popularity of black-and-white televisions from 1966 to 1973, and by color television from 1974. Growing at 10 percent a year between 1959 and 1973, the electronics industry has made significant contributions to the success of the three successive five-year economic development plans. Nevertheless, the rising protectionist barriers in the United States and Europe, the increasing competition from other developing countries, the growing shortage of labor and the rising wage level are critical issues that must be overcome in order for the Korean electronics industry to continue its growth.
- 한국전자공업의 현황과 문제점(Current status and Issues of the Korean electronics industry)
한국전자공업의 현황과 문제점(Current status and Issues of the Korean electronics industry)
|Series Title; No||정책연구시리즈 / 79-01|
|Subject||Industry and Technology < IT|