Success secrets of developed nations
May 26, 2011
LAHORE: Despite being haunted by the ghostly terrorism, Pakistan has still not lost everything if one compares it with South Korea that was totally demolished after its three-year-long war with North Korea between 1950 and 1953, or if one weighs it against countries like Japan, Germany and England that were utterly ravaged by the Second World War (1939-45).
When it was invaded by North Korea in June 1950, South Korea was in a ditch because it was vying hectically at that juncture to repair the damage already inflicted to its frail foundations by the Japanese occupation that had ended with Japan’s defeat in World War II in 1945.
Formally established on August 15, 1948, as annals of history reveal, it wasn’t an easy journey from plight to splendour for a country which had to witness numerous student uprisings, horrible media censorships, successive military coups and consequent martial laws—leading to grave political instability. But even the worst of South Korean dictators like General Park Chung-hee and General Chun Doo-hwan did not compromise on the goal of rapid export-led economic growth.
In his 2004 book “Korea: A rags to riches story,” a Bangkok-based Western writer John Walsh has observed, “In 1953, after the signing of the ceasefire that has so far prevented the further outbreak of the Korean Civil war, South Korea (also known as the Republic of Korea or ROK) was one of the world’s ten poorest countries. Fifty years later, the ROK is a member of the rich countries’ club the OECD (Organisation of Economic co-operation and Development) and has become a significant industrial power in the world. It has also broken into the world’s top ten sporting nations, as the recent Olympics medal count demonstrated and of course hosted one of the most successful ever Olympic Games festivals in 1988. How has the ROK managed this staggering transition?”
Welsh writes, “For many hundreds of years, Korea was a completely enclosed kingdom, permitting neither visitors nor emigrants and was known as the Hermit Kingdom. This was its response to having been invaded dozens of times by Chinese, Manchurian and Japanese invaders - Korea itself has never attempted to invade another country. In 1910, this period of self-sufficiency, which had led to a situation of remarkable ethnic and cultural homogeneity, was ended by the conquest and occupation of the peninsula by imperial Japanese forces. The subsequent treatment of the Korean people was very deplorable.”
He maintained, “Consequently, leaders of the newly-established ROK realized they would have to develop the country and its defence and industrial capability as rapidly as possible and on the basis that they might have to protect themselves alone.”
John Welsh further wrote in his afore-mentioned book that South Korean leaders had ensured that all South Koreans understood the dangers they faced and were determined to work as hard as possible and made sacrifices.
The South Korean leaders also made it sure “that business corporations such as Hyundai, Samsung and Lucky Gold Star (now LG) were provided significant advantages and support as long as their business plans followed various government priorities, particularly with respect to chemical and heavy industries and in promoting exports.”
But irrespective of turmoil and internal mayhem, South Korea continued to prosper and today this country of 50 million people has a GDP (Purchasing Power Parity) of $1.46 trillion and a per capita income of $29, 835.
In 2010, South Korea was the sixth largest exporter ($466.30 billion) and eighth largest importer ($417.90 billion) in the world. It has a market economy which ranks 14th in the world by nominal GDP and 12th by Purchasing Power Parity calculations.
Allocating 2.6 per cent of its GDP and 15 per cent of all government spending to its military due to persistent animosity with North Korea, South Korea has the world’s sixth largest number of active troops (3.7 million) and the 11th largest defence budget.
Pakistan, if it wishes, can also seek a lot of motivation by the Japanese post-world War II miracle. Though the United States had poured a lot of money into Japan, after having devastated its cities Hiroshima and Nagasaki in 1945, the Japanese manufacturers, suppliers, distributors, bureaucrats and banks developed an integrated union to take their country to new heights. Japan was basically ‘rewarded’ by the US for aligning with Washington and South Korea during the Korean War.
The World War II had literally crippled Japan along with steep inflation and unemployment, but sheer hard work and efficiency helped the war-torn country climb the ladder of lasting success, besides preventing the spread of militancy.
Moreover, effective regulations were put in place to check the flooding of Japan’s markets by overseas goods. By the late 1960s, Japan had risen from ruins to accomplish robust economic growth through massive industrialization by dishing out easy loans for industry, by keeping the taxes and bank interest rates low and through construction of an excellent infrastructure across the country. Excellent policies of protectionism vis-‡-vis the industrial sector also helped Japan to keep on giving birth to millionaires.
A report prepared by Messrs Barclays Wealth, a UK-based wealth manager providing international and private banking, advisory and fiduciary services, has estimated that by 2017, Japan will have 10.7 million millionaires (up from 3.6 million in 2007), behind the US (29.7 million) and ahead of the UK (5.3 million).
At present, the economy of Japan is the third largest in the world after the United States and China, but ahead of Germany at 4th. With a GDP (Purchasing Power Parity) of $4.309 trillion in 2010 and with a GDP per capita of $34,200, Japan has a labour force of 65.64 million.
With exports resting at $765.2 billion and imports touching the figure of $636.8 billion today, Japan stands tall as the world’s fourth largest exporter. The country also possesses Forex reserves of $1.024 trillion—-speaking volumes of its financial prowess and consistent achievements.
Looking at the United Kingdom’s losses after World War II, one finds that this country was factually tottering during its combat with Hitler’s Nazi Germany and had to sell its gold and dollar reserves to pay for weapons, raw materials and industrial equipment from US factories. Its gold and dollar reserves were hence near exhaustion and the country was on the verge of bankruptcy. Its exports were nose-diving. However, the US came to its rescue during the war with some financial incentives.
After World War II, the economy of the British Empire was weakened to a great extent, its industrial output had plunged, shortages of energy (coal) were posing an ominous threat and people were seen converting the British Pound Sterling for the US dollar every day.
Governments in Britain, however, embarked upon a plan to provide incentives for industry and went for extensive house building.
The construction of new commercial developments and public buildings in the next few decades after the World War II helped unemployment stay low and the Brits kept on winning bread amid strike calls by trade unions.
However, the industrial strife of 1978 coupled with soaring inflation and surging unemployment, led Britain to be nicknamed as the “sick man of Europe.”
But then came Premier Margaret Thatcher in 1979 and privatized the state-run enterprises like British Aerospace, British Telecom, British Leyland, Rolls Royce and the British Steel. She abolished exchange controls and the British offshore assets rose about nine times to rest at £110 billion by the end of 1986. All these moves triggered the ailing British economy and the country experienced an economic boom—-a miracle in fact.
Recession and inflation have continued to hound the UK economy at regular intervals since 1986, but the Bank of England’s control of interest rates has been good at providing the desired stability to the British pound vis-‡-vis the US dollar.
And today, the British economy is the seventh largest, if measured by Purchasing Power Parity, and the second largest in Europe after Germany.
With a GDP (Purchasing Power Parity) of $2.71 trillion, UK is the world’s 10th largest exports with exports of over $405.6 billion.
Its GDP per capita is $35,286, the labour force statistics read 31.45 million, the import figure stands at $546.5 billion and its Forex reserves are counted at $66.72 billion. The country also has gold reserves of 310.3 tonnes.
The reconstruction of Germany after World War II is also phenomenal and eyebrow raising.
During the World War II, Germany had also suffered heavy losses, its cities were completely damaged from the heavy bombings, its farm output had fallen drastically, the industrial production had received a severe jolt from the battle with Britain and over 10 per cent of the German population (over 7.5 million at that time) had perished during the combat. Under Hitler, the Nazi forces defeated France, invaded Norway, Poland, Yugoslavia, Greece and a good chunk of the European portion of the Soviet Union.
Germany formed wartime partnerships with Hungary, Romania, Bulgaria and Finland, but could not recover after the 1942 defeat at Stalingrad at the hands of the Stalin-led Soviet Red Army.
Hitler committed suicide after putting Germany on the road to destruction and the country was greeted by despair and despondency after the World War II. Between 1949 and 1952, under the US-led Marshall plan or the “European Recovery Programme,” West Germany received loans to the tune of $1.45 billion, only to spur its exports, enhance the once-depleted agricultural output and reduce unemployment.
Currently, Germany has a GDP of $3.306 trillion, labour force of 43.51 million, exports of 1.146 trillion Euros, imports of 1.020 trillion Euros and Forex reserves of $184 billion—-and not many more numbers are required to substantiate the fact that Germany has been magnificent since the Second World War.
When it was invaded by North Korea in June 1950, South Korea was in a ditch because it was vying hectically at that juncture to repair the damage already inflicted to its frail foundations by the Japanese occupation that had ended with Japan’s defeat in World War II in 1945.
Formally established on August 15, 1948, as annals of history reveal, it wasn’t an easy journey from plight to splendour for a country which had to witness numerous student uprisings, horrible media censorships, successive military coups and consequent martial laws—leading to grave political instability. But even the worst of South Korean dictators like General Park Chung-hee and General Chun Doo-hwan did not compromise on the goal of rapid export-led economic growth.
In his 2004 book “Korea: A rags to riches story,” a Bangkok-based Western writer John Walsh has observed, “In 1953, after the signing of the ceasefire that has so far prevented the further outbreak of the Korean Civil war, South Korea (also known as the Republic of Korea or ROK) was one of the world’s ten poorest countries. Fifty years later, the ROK is a member of the rich countries’ club the OECD (Organisation of Economic co-operation and Development) and has become a significant industrial power in the world. It has also broken into the world’s top ten sporting nations, as the recent Olympics medal count demonstrated and of course hosted one of the most successful ever Olympic Games festivals in 1988. How has the ROK managed this staggering transition?”
Welsh writes, “For many hundreds of years, Korea was a completely enclosed kingdom, permitting neither visitors nor emigrants and was known as the Hermit Kingdom. This was its response to having been invaded dozens of times by Chinese, Manchurian and Japanese invaders - Korea itself has never attempted to invade another country. In 1910, this period of self-sufficiency, which had led to a situation of remarkable ethnic and cultural homogeneity, was ended by the conquest and occupation of the peninsula by imperial Japanese forces. The subsequent treatment of the Korean people was very deplorable.”
He maintained, “Consequently, leaders of the newly-established ROK realized they would have to develop the country and its defence and industrial capability as rapidly as possible and on the basis that they might have to protect themselves alone.”
John Welsh further wrote in his afore-mentioned book that South Korean leaders had ensured that all South Koreans understood the dangers they faced and were determined to work as hard as possible and made sacrifices.
The South Korean leaders also made it sure “that business corporations such as Hyundai, Samsung and Lucky Gold Star (now LG) were provided significant advantages and support as long as their business plans followed various government priorities, particularly with respect to chemical and heavy industries and in promoting exports.”
But irrespective of turmoil and internal mayhem, South Korea continued to prosper and today this country of 50 million people has a GDP (Purchasing Power Parity) of $1.46 trillion and a per capita income of $29, 835.
In 2010, South Korea was the sixth largest exporter ($466.30 billion) and eighth largest importer ($417.90 billion) in the world. It has a market economy which ranks 14th in the world by nominal GDP and 12th by Purchasing Power Parity calculations.
Allocating 2.6 per cent of its GDP and 15 per cent of all government spending to its military due to persistent animosity with North Korea, South Korea has the world’s sixth largest number of active troops (3.7 million) and the 11th largest defence budget.
Pakistan, if it wishes, can also seek a lot of motivation by the Japanese post-world War II miracle. Though the United States had poured a lot of money into Japan, after having devastated its cities Hiroshima and Nagasaki in 1945, the Japanese manufacturers, suppliers, distributors, bureaucrats and banks developed an integrated union to take their country to new heights. Japan was basically ‘rewarded’ by the US for aligning with Washington and South Korea during the Korean War.
The World War II had literally crippled Japan along with steep inflation and unemployment, but sheer hard work and efficiency helped the war-torn country climb the ladder of lasting success, besides preventing the spread of militancy.
Moreover, effective regulations were put in place to check the flooding of Japan’s markets by overseas goods. By the late 1960s, Japan had risen from ruins to accomplish robust economic growth through massive industrialization by dishing out easy loans for industry, by keeping the taxes and bank interest rates low and through construction of an excellent infrastructure across the country. Excellent policies of protectionism vis-‡-vis the industrial sector also helped Japan to keep on giving birth to millionaires.
A report prepared by Messrs Barclays Wealth, a UK-based wealth manager providing international and private banking, advisory and fiduciary services, has estimated that by 2017, Japan will have 10.7 million millionaires (up from 3.6 million in 2007), behind the US (29.7 million) and ahead of the UK (5.3 million).
At present, the economy of Japan is the third largest in the world after the United States and China, but ahead of Germany at 4th. With a GDP (Purchasing Power Parity) of $4.309 trillion in 2010 and with a GDP per capita of $34,200, Japan has a labour force of 65.64 million.
With exports resting at $765.2 billion and imports touching the figure of $636.8 billion today, Japan stands tall as the world’s fourth largest exporter. The country also possesses Forex reserves of $1.024 trillion—-speaking volumes of its financial prowess and consistent achievements.
Looking at the United Kingdom’s losses after World War II, one finds that this country was factually tottering during its combat with Hitler’s Nazi Germany and had to sell its gold and dollar reserves to pay for weapons, raw materials and industrial equipment from US factories. Its gold and dollar reserves were hence near exhaustion and the country was on the verge of bankruptcy. Its exports were nose-diving. However, the US came to its rescue during the war with some financial incentives.
After World War II, the economy of the British Empire was weakened to a great extent, its industrial output had plunged, shortages of energy (coal) were posing an ominous threat and people were seen converting the British Pound Sterling for the US dollar every day.
Governments in Britain, however, embarked upon a plan to provide incentives for industry and went for extensive house building.
The construction of new commercial developments and public buildings in the next few decades after the World War II helped unemployment stay low and the Brits kept on winning bread amid strike calls by trade unions.
However, the industrial strife of 1978 coupled with soaring inflation and surging unemployment, led Britain to be nicknamed as the “sick man of Europe.”
But then came Premier Margaret Thatcher in 1979 and privatized the state-run enterprises like British Aerospace, British Telecom, British Leyland, Rolls Royce and the British Steel. She abolished exchange controls and the British offshore assets rose about nine times to rest at £110 billion by the end of 1986. All these moves triggered the ailing British economy and the country experienced an economic boom—-a miracle in fact.
Recession and inflation have continued to hound the UK economy at regular intervals since 1986, but the Bank of England’s control of interest rates has been good at providing the desired stability to the British pound vis-‡-vis the US dollar.
And today, the British economy is the seventh largest, if measured by Purchasing Power Parity, and the second largest in Europe after Germany.
With a GDP (Purchasing Power Parity) of $2.71 trillion, UK is the world’s 10th largest exports with exports of over $405.6 billion.
Its GDP per capita is $35,286, the labour force statistics read 31.45 million, the import figure stands at $546.5 billion and its Forex reserves are counted at $66.72 billion. The country also has gold reserves of 310.3 tonnes.
The reconstruction of Germany after World War II is also phenomenal and eyebrow raising.
During the World War II, Germany had also suffered heavy losses, its cities were completely damaged from the heavy bombings, its farm output had fallen drastically, the industrial production had received a severe jolt from the battle with Britain and over 10 per cent of the German population (over 7.5 million at that time) had perished during the combat. Under Hitler, the Nazi forces defeated France, invaded Norway, Poland, Yugoslavia, Greece and a good chunk of the European portion of the Soviet Union.
Germany formed wartime partnerships with Hungary, Romania, Bulgaria and Finland, but could not recover after the 1942 defeat at Stalingrad at the hands of the Stalin-led Soviet Red Army.
Hitler committed suicide after putting Germany on the road to destruction and the country was greeted by despair and despondency after the World War II. Between 1949 and 1952, under the US-led Marshall plan or the “European Recovery Programme,” West Germany received loans to the tune of $1.45 billion, only to spur its exports, enhance the once-depleted agricultural output and reduce unemployment.
Currently, Germany has a GDP of $3.306 trillion, labour force of 43.51 million, exports of 1.146 trillion Euros, imports of 1.020 trillion Euros and Forex reserves of $184 billion—-and not many more numbers are required to substantiate the fact that Germany has been magnificent since the Second World War.
