Last month South Korea unveiled a $40 billion economic stimulus package designed to boost a lagging growth rate. In an email interview, Dwight Perkins, professor emeritus of political economy at the Harvard Kennedy School of Government, discussed the state of South Korea’s economy.
WPR: What are the main factors behind South Korea's recent economic slowdown?
Dwight Perkins: South Korea’s growth averaged 3 percent between 2011-2013. That rate of growth is slightly below South Korea’s average growth rate over the past nine years, but that is hardly surprising given the weaknesses in European and North American economic performance. We do not have a reliable estimate of the potential maximum sustained growth rate of the South Korean economy, but the days of 6 to 7 percent growth and higher are long past. South Korea has reached a mature stage of development where all countries slow down, usually to no more than 3 or 4 percent per year.