International Symposium on Information and Communication Technologies and the Information Society, 9-11 December 2002, Algeria

- Koreas

ICT Policy & Key Success Factors -

Ch a n g , K w a n g -So o Director of International Policy Division

Ministry of Information and Communication Republic of Korea

(www.mic.go.kr)

CONTENTS
? Korean Economy Briefs . ?. Worlds Recognition ? . Koreas ICT Policy ? . Key Success Factors in ICT Sector ? . Bilateral Cooperation for ICT Development

Korean Economy Briefs: Statistics and Facts

Size of Korean Economy(2001) Population: 47.3 Million GDP : US$ 422.2 Billion Per Capita GDP : US$ 8,919 Korean Economy and Trade(2001) Korean Economy is Driven by International Trade - Export : US$ 150.4 Billion ? 2002(US$ 162.0 Billion) - Import : US$ 141.1 Billion ? 2002(US$ 151.0 Billion) - Trade Surplus : US$ 9.34 Billion ? 2002(US$ 11.0 Billion)
2

Korea in the World Economy

Population

26

GDP

12 13 12
5 10 15 20 25 30

Import

Export 0

Rank in the World

* Comparisons are based on 2001 statistics (Source: Korea National Statistical Office)

Economic Growth in Korea

High Economic Growth in four decades.

Five-year Economic Development Plans since 1960s led to solid growth in four decades 1960(per capita GDP 79US$ ? 2001(8,919 US$)(113 times) * Financial crisis(1997) ? Rapidly Recovered in 2000 Critical success factors in rapid economic growth Diligent nationality, presidential leadership, Government-led economy The establishment of Economic Planning Board & Korea Development Institute Fostering the heavy and chemicals industry(iron, automobile) 4

Koreans are the worlds most active and sophisticated Internet users
- May 3, 2001, Wall Street Journal

there are no proven models for Korea to follow

- Alvin Toffler, Over the Crisis : A Vision for Korea in the 21st Century

As one of the most wired countries in todays world, South Korea is surpassing the United States in broadband penetration.
- June 7, 2001, CNN

Korea is a testing area for digital technology and most advanced broadband internet market
- May, 2002, Financial Times5

Koreas ICT Policy

Building a world-class Information Infrastructure (155Mbps-5Gbps) by the end of 2000. 10 Million, 70% of the total households are connected to the broadband internet(1st in the world) < Broadband internet user(% of 100 persons, 2001.12, OECD) > Korea Canada Sweden U.S.A Japan OECD
17.2 8.4 5.0 4.5 2.2 2.9

Koreas ICT Policy

Realizing the most computer literate nation in the world. Free broadband internet service to all the primary, middle and high schools(10,400) Broadband internet service to all the rural Areas (universal service) Satellite internet service to island and hinterland at affordable price Internet education for all the people(14 million) ? 52 personal computers(PCs) per 100 persons
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Koreas ICT Policy

Constructing a world leading nation in mobile Communication Commercialized CDMA technology for the first time in the world(1996) ? 32.3 million(70% of total population) use mobile phones. Commercialized 3G mobile communication service (cdma 2000-1x : 144Kbps) for the first time in the world. ? Number of Subscribers : 15 million Volume of mobile phone export(2001) : 10 billion US$
9

Koreas ICT Policy

Realizing 11 Key e-government systems(2002.10.30) About 400 civil petition services at Home ? 4000 civil petition services at Home by the end of 2006 Proportion of e-approvals in the government : 94.6% Proportion of e-procurement of the government : 87.5% Proportion of e-trade : 66.6% Proportion of e-stock trading : 70.0%
* 11 Key projects : Government service portal(G4C), Integrated social insurance information system, Home tax service(HTS), E-procurement system, Financial information system, Administrative information system for local govt, Government personnel management information system etc.
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Koreas ICT Policy

ICT industry as Engine of Economic Growth ICT industry is driving force of Koreas economic growth - Annual growth rate of ICT sector since 1998 : 22.7% - Share of ICT Industry in GDP(2001) : 12.9% - Contribution rate of ICT to GDP growth(2000) : 50.5% - 26% of total export come from ICT sector. - Trade surplus from ICT sector makes up for deficits in other sectors.
* 2001 total trade surplus : 9.3 billion $, ICT : 10.6 billion $ 11

Koreas ICT Policy

4th in ICT hardware production - 1st in DRAM production World market share: 38%(2000) - 2nd in TFT-LCD production World market share: 42%(2001, 6) 41.5%(2001. 6 ) 37%(2002, 3)

- 4th in mobile phone production(GSM & CDMA) World market share: 14%(2001) 20%(2002) Samsung(3rd in the world), LG(6th in the world) * CDMA mobile phone world market share : 70 %(2001)

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Koreas ICT Policy

Closing domestic & International Digital Divide Enactment of Digital Divide Law(2000.11) Establishment of Committee for Bridging the Digital Divide Establishment of 5-year plan to bridge the digital divide Invitation of ICT Trainees from developing Countries (1,200 persons since 1998), dispatch of Internet youth volunteers(500 persons since 2001), dispatch of ICT policy advisory team, establishment of internet acces centers in developing countries.
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Korean ICT indicators (1)

Number of PCs
The number of PCs: 6.3 million (1996) to 24 million (2002.10) The number of PCs per 100 capita reached 52.0%(2002.10)
18,000 PCs (1,000 unit) 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0 PCs per 100 capita 1997 6,931 15.1 1998 8,269 17.8 1999 11,530 24.7 2000 18,615 39.6 2001 21,490 45.7 2002.10. 24,370 52.0 60 50 40 30 20 10 0 pe r 100 ca pita

14

Korean ICT indicators (2)

Number of Internet Users The number of Internet users has shown explosive growth, recording 25.6 million (54.6% penetration rate) at the end of June 2002.
I n te r n e t u se r s (1 , 0 0 0 u n i t) 25,000 20,000 15,000 10,000 5,000 0
1997 1,634 3.6 1998 3,103 6.7 1999 10,860 23.3 2000 19,040 40.5 2001 24,380 51.9 2002. 6 25,650 54.6

60 50 40 30 20 10 0 p e r 1 0 0 c a p i ta

Internet users per 100 capita

15

Korean ICT indicators (3)

Subscribers of Broadband Internet Services
The number of subscribers of broadband Internet service reached 10 million, including 5.3 million subscribers to ADSL-based Internet and 3.4 million subscribers to cable modem as of Oct 2002 Mainly due to intense competition among service providers & low prices, urban geography and killer applications like VoIP.
15,000 10,000 5,000 0 ADSL CATV others Total 1,000 household

Dec 2000 2,074 1,386 557 4,017

Mar 2001 2,806 1,757 532 5,095

Jun 2001 3,505 1,953 793 6,251

Sep 2001 3,946 2,252 841 7,039

Nov 2001 4,186 2,472 866 7,524

Oct-02 5,384 3,449 1,169 10,002

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ICT Industry and Trade(1)

ICT Production
Unit: billion($) Unit: billion won 120

ICT Sectors Production

116.4
7% 22.
80,000

80

63.0
40

60,000

f nu a

g rin tu ac

40,000

ces Servi IT

20,000

S/W & CRS

98 99 00 01
0

97

98

99

00

01

17

ICT Industry and Trade(2)

Share of ICT Industry in GDP ICT industrys share in GDP continues to grow, from 9.3% in 1998 to 12.9% in 2001 The growing share suggests that ICT industry is the driver of Koreas future economic growth
80.0 70.0 60.0 50.0 Value Added 40.0 30.0 20.0 10.0 '98 '99 2000 2001 6.0% 4.0% 2.0% 0.0% 9.3% 11.2% 13.1% 12.9% 14.0% 12.0% 10.0% Share of IT in GDP 8.0%

18

ICT Industry and Trade(3)

Contribution of ICT to GDP growth ICT industrys contribution to GDP growth rose from a mere 4.5% in 1990 to an astonishing 50.5% in 2000 Falling prices and rising production in ICT industry are main factors for growing importance of ICT sector
60 50 40
% 30
50. 5 38. 3 14. 1

20 10 0
4. 5 5. 9 12. 1

1990

92

94

96

99

2000

19

20

Key Success Factors

(1) Public Consensus & Presidential leadership
Late in industrialization, but ahead in Digitalization * Fixed-line peretration increased from 7.2% in the early 1980s to 50% in 2002.

(2) Establishment of a long-term Strategy & ICT infrastructure

Korea Information Infrastructure initiative(KII), (Mid 90s), CYBER KOREA 21 & e-Government Initiative(late 90s), e-Korea vision 2006(2002) * These strategies and vision for digitalization win public faith and support.
21

Key Success Factors

(3) Comprehensive & Systematic Implementation Mechanism

Ministry of Information & Communication(1994. 12) Basic Law on Informatization Promotion(1995) Informatization promotion Committee(1996) Informatization strategy council(1998)

(4) Public Information Training to create ICT demand

One million House wives Internet class ICT Learning class for the disabled Silver Internet class for the elderly ICT class for prisoners & soldiers
22

Key Success Factors

(5) Establishment of Market Principle through Competition
Deregulation, privatization allows multiple players in the telecom market since mid, 1990s.
(June 2002) category Facility based service provider Special service provider Value added service provider total
* Number of ICT venture : 4,335

No. of service providers 33 338 2,922 3,293

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Key Success Factors

(6) Government measures for the creation of ICT Certificate for Computer Proficiency given to student. Certification of Cyber Apartment Financial Support(loan) for rural areas ICT Infrastructure Development (7) Unique Korean Internet Culture 25,000 Internet Cafes(PC Bang) On-line games
24

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Bilateral Cooperation for ICT Development

Conclusion of MOU on ICT between Korea & Algeria. Establishment of ICT cooperation committee between Korea & Algeria Finding out the ways to cooperate in the ICT sector Broadband Network, Internet, e-Government, mobile Communication, etc. Exchange of ICT human resources Dispatch of Internet youth volunteers & ICT consulting team to Algeria Invitation of Alegrian ICT experts to Korea Transfer of technology in ICT sector Holdings of annual Symposium & Seminar
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