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Logical estimation of 2nd trigger point and business case modeling of Gwangyang port phase 3-2

1. Container Terminal Development History of South Korea

a. Introduction on South Korea economy
During the South Korea War (June 1950 - July 1953) most of the industrial facilities and infrastructures were devastated. South Korea became one of the poorest countries in the world and most of the necessaries supplies were depended on aids from overseas. After the South Korean War, South Korea changed into capitalistic republic country and the South Korean government adopted export drive policies. South Korea did not have many natural resources and only thing abundant in South Korea was hungry human resources. Basically most of raw materials had to be imported from overseas and half-finished and finished goods were exported to other country. South Koreas economic transformation was a huge success and South Korean economy quickly entered into emerging market group. At the same time, the demand for seaborne transportation had increased surprisingly.

Figure 1.1 Economic growth rate of South Korea (1971 - 2010, %) [Source: Economic Statistics System, Bank of South Korea, http://econs.bok.or.kr 16 June 2011, data converted into the graph by author]

Figure 1-2 Export and import growth rate of South Korea (1991 - 2010, %) [Source: Economic Statistics System, Bank of South Korea, http://econs.bok.or.kr 16 June 2011, data converted into the graph by author]

South Korea became an OECD (Organization Economic for Cooperation and Development) in 1995 and joined the trillion dollar club in 2004. South Korea is a high-tech economy with leading electronics and IT, automotives, heavy industry companies. According to CIA the World Factbook, GDP-purchasing power parity of South Korea in 2010 was estimated USD 1,459 trillion which is 13th in the world. Estimated GDP-per capita (PPP) in 2010 was USD30.000 which is 45th in the world. [Source: CIA, the World Factbook, East & Southeast Asia, Korea, South,

https://www.cia.gov/library/publications/the-world-factbook/geos/ks.html 16 June 2011]

b. Port development history of South Korea

South Korea (Chosun Dynasty, 1932-1910) opened Busan, Wonsan and Incheon port to foreign trade for the first time in 1876 by unequal treaty with Japan. For colonization and war against China and Western powers, Japan developed several ports in Korea such as Incheon, Busan, Mokpo, Yeosu, Pohang and Mukho. South Korea was liberated from Japanese colonial rule in 1945 but poor economy and trade volume deterred not only the utilization but also maintenance of the ports. To make thing worse, most of the port facilities were damaged during the Korean War Until 1960s, virtually there was no demand for international ports. In 1961, Korea Army general Park Chung-hee seized power by military coup and industrialization
was initiated.