Building on its reputation as a development success story, Korea uses its role as a leading middle-sized power to build bridges between rich and poor countries in a range of global fora, achieving influence beyond its size. Increasingly, Korea is also demonstrating commitment to addressing the global public “goods” and “bads” that are key to achieving the Sustainable Development Goals. However, there is a tension between its role on the global stage and implementation efforts at home.
OECD Development Co-operation Peer Reviews: Korea 2018
OECD Development Co-operation Peer Reviews
Chapter 1. Korea’s global efforts for sustainable development
Efforts to support global sustainable development
Korea leads by example, sharing knowledge and building bridges between rich and poor countries
Peer review indicator: The member plays an active role in contributing to global norms, frameworks and public goods that benefit developing countries
Korea leads by example. Its path from poverty to advanced industrialisation arguably provides the best evidence for developing countries that sound government policies combined with effective use of aid can drive growth and development (Lewis et al., 1987; Noland, 2011).1 Based on this experience, Korea is highly active on the global stage, sharing its development knowledge with developing countries,2 playing a key role with other middle-sized powers and linking with six major national economies – Brazil, Russia, India, Indonesia, China and South Africa (the BRIICS) – to help drive global agreements on sustainable development.
For Koreans, the election of former foreign minister Ban Ki-Moon to the top United Nations (UN) job from 2007-16 was symbolic of their country’s long-term commitment to multilateralism and global solutions for peace and development (Fifield, 2016). Since joining the Development Assistance Committee (DAC) in 2010, Korea’s priority issues for global engagement in sustainable development include regional economic integration and crisis prevention, development effectiveness and climate change. On each of these issues, Korea has played an effective role as broker between developed and developing countries. Korea also participates in UN-led peacekeeping missions with more than 600 military and civilian staff, mainly in Lebanon and South Sudan.3
Korea works to elevate development issues in a range of global fora
As part of efforts to promote global economic stability and ward off crises, Korea is a driving force behind the G20’s work on inclusive growth and efforts to increase outreach to developing countries.4 It hosted the G20 in 2010 and delivered the G20’s first development agenda. Through this engagement, Korea has continued to build on its comparative advantage in key economic and social sectors critical to its own development journey – infrastructure, innovation, rural development, health and education. The outcome document of the G20 summit chaired by Korea in 2010 (G20, 2010) reiterated a commitment to engage in dedicated knowledge‑sharing efforts with developing countries keen to learn from Korea’s experience. In 2017, in line with its comparative advantage in innovation, Korea is chairing the G20 Development Working Group on Human Resources Development, targeting literacy in information and communication technology for boys, girls and women. It is also continuing to support the G20’s role as a platform for catalysing political support for Agenda 2030. In addition, in 2015-16, Korea held the presidency of the Financial Action Task Force (FATF), focussing on counter-terrorism financing in response to a G20 call for action and resulting in the establishment of a new global training centre in Korea to build capacity for implementation of FATF standards. Since its mutual evaluation of 2009, FATF considers that Korea has taken sufficient measures to bring its anti-money laundering and countering the financing of terrorism into line with its 2003 Recommendations. Korea is due to be reassessed under FATF’s new standards (the 2012 FATF Recommendations) in 2020 (FATF, 2016).
Regionally, Korea has an important role as a broker of financial and economic policy dating back to the Asian financial crisis of 1997-98. Since then, Korea has worked to drive a range of collective intra-regional initiatives to mitigate the impacts of economic shocks and to increase growth, including by developing regional bond markets to promote more efficient recycling of Asian savings and investment in the region (Park, 2012). Korea works closely with its neighbours through regional fora, particularly the Asia‑Pacific Economic Cooperation (APEC) and the Association of Southeast Asian Nations (ASEAN) Plus Three partnership,5 where it has forged a role as an honest broker on economic co-operation and a range of global development issues. It complements this regional engagement with broader alliances, such as the informal partnership with Mexico, Indonesia, Turkey and Australia (known as MIKTA).
To strengthen and facilitate these global and regional partnerships, Korea has established a number of local research and policy offshoot organisations, including for ASEAN and OECD policy centres. Korea is active in hosting international meetings and on the governing boards of the Asian Development Bank, World Bank, and the Asian Infrastructure Investment Bank. In September 2015, Korea contributed to advancing health security issues by hosting a high‑level meeting of the Global Health Security Agenda in its role as rotating chair. More recently, in June 2017, Korea hosted the second annual board of governors’ meeting of the Asian Infrastructure Investment Bank (AIIB, 2017) and is preparing to host the African Development Bank’s 2018 annual meetings (AfDB, 2017).
An early implementer of the sustainable development goals, Korea is working to translate its commitments into action
Increasingly, Korea is using its global and regional clout to heighten awareness of the need to address a range of global public “goods” and “bads” that are critical for achieving the Sustainable Development Goals (UN, 2015). Furthermore, after volunteering to be an “early implementer” of the Sustainable Development Goals (SDGs), Korea has integrated the SDGs into its national development co-operation strategies and plans (GoK, 2015a; Chapter 2) and is framing its efforts through the lens of green growth. Building on its existing domestic legislation for sustainable development (National Assembly, 2015), Korea is now considering how to embed the goals into its legislative framework for domestic policies, including how to increase emphasis on the social pillar of sustainable development. Nevertheless, as explained below, there is an ongoing tension between Korea’s expanding role on the global stage and its capacity to uphold its own commitments to sustainable development through national implementation.
Policy coherence for development
Peer review indicator: Domestic policies support or do not harm developing countries
Korea strives to address the concerns of developing countries on the negative spillover effects of its domestic policies. However, it has yet to put in place a plan for identifying, monitoring and addressing key priorities for action across government, including on climate and trade.
Korea reacts to developing country concerns on policy coherence issues as they arise
Korea is adopting a pragmatic approach to policy coherence for sustainable development and global public goods in areas such as green growth, trade and remittances, playing close attention to the concerns of developing countries raised in international fora and in bilateral discussions on a case-by-case basis. For example, Korea has prioritised close collaboration with several Asian countries through its rapidly expanding investment in manufacturing, tourism and agriculture and increasing trade following the 2010 ASEAN‑Korea Free Trade Agreement. As observed in this review’s field mission, over the past decade, Korea's exports to Cambodia have tripled, while Cambodian exports to Korea have risen 40-fold (Annex C). This – along with high remittance flows and demand-driven knowledge-sharing efforts – is helping to catalyse and broaden economic and political co-operation between the two countries.
There is no systematic approach to address policy coherence for development
Korea has yet to fully address the 2012 peer review recommendations to create a government-wide agenda to achieve development-friendly policies and strengthen existing analysis of, and reporting on, how Korea’s foreign and domestic policies affect developing countries (OECD, 2012). In its latest memorandum to the DAC, Korea notes that it has attempted to improve coherence by holding biannual government-wide official development assistance (ODA) workshops to share information across government on development co‑operation (GoK, 2017a). In 2016, Korea’s Committee for International Development Cooperation (CIDC) conducted a study of the policy and practices of other DAC members on policy coherence for development. It is not clear how this study has informed Korea’s approach to policy coherence. While development co‑operation is well integrated into Korea’s foreign policy6 (Office of the President, 2009), it has yet to establish a process of systematic diagnosis and planning that would enable deeper analysis of how its domestic policies are affecting developing countries.
More systematic attention to policy coherence would give Korea the tools to manage the impact of its policies on developing countries. It would also help Korea’s international reputation. For example, while Korea has improved its work on policy coherence and the availability of information for analysis, it is currently ranked in last place out of 27 countries for the 2017 Commitment to Development Index (CGD, 2017), a drop in ranking from 2015, largely due to its performance in climate and security7. On the other hand, Korea is the top performer in the technology component of the index, due to its policies that promote knowledge sharing and with research and development funding at over 1% of its gross domestic product.
Korea can extend its policy coherence efforts further, drawing on the drivers of its own development
Korea has an opportunity to make a stronger, more strategic contribution to global efforts on policy coherence by looking to the drivers of its own development beyond ODA. On trade, for example, despite progress in recent years and ongoing efforts to reduce tariffs (particularly on non-agricultural products), Korea’s tariffs and quotas on agricultural imports from developing countries remain high on average, with many restrictions on trade in services. This approach is at odds with Korea’s own development experience during which it benefitted from external policy settings allowing trade to flourish.8
In addition, Korea is recognised globally for its leadership in hosting the Green Climate Fund and the Global Green Growth Institute (GGGI), with significant development finance contributions in this area (see Chapter 3) and a commitment to greening its ODA. However, like many other countries, Korea still has a long way to go in achieving its climate goal and other official flows to developing countries have contributed to polluting activities. For example, in the energy sector, other official finance (non-ODA) for coal‑ and gas-fired power plants was more than triple that for geothermal and hydroelectric plants over the past five years (OECD, 2017b). In international analysis of negative spillover effects that hinder the ability of developing countries to achieve the SDGs, Korea is listed in the bottom third of OECD country rankings, with priority areas for policy action listed as climate (Sachs et al, 2017). The ranking also reflects Korea’s low levels of ambition in its commitments at the 2015 United Nations Climate Change Conference (GoK, 2015b).9 As Figure 1.1 shows, Korea is well below the OECD average on international climate action. With an energy mix dominated by fossil fuels, Korea’s greenhouse gas emissions rose by 38% from 2000‑14, the third highest growth rate among OECD countries (OECD, 2017a10 and OECD 2017b).
Figure 1.1. How Korea compares with the OECD average on the Sustainable Development Goals
Note: This figure shows Korea’s distance to travel towards each of the 17 goals of the 2030 Agenda. Bars show Korea’s performance, while diamonds show the OECD average. White bars indicate missing data. The y-axis indicates the distance from reaching the target in standardised units. 0 indicates that the level for 2030 has already been attained, and the axis starts at 3 as most OECD countries have already attained this level. Distances to target are aggregated at the goal level (all targets weighted equally). To make the level of achievement within the country more distinct, in this figure, data on Official Development Assistance (ODA) are excluded in Goals 1 to 16. Nonetheless, total ODA, ODA focusing on capacity building and national planning as well as ODA commitments to statistical capacity building are included in Goal 17 “implementation” and under Partnership.
Source: OECD (2017b), “Measuring distance to the SDG targets: an assessment of where OECD countries stand”, www.oecd.org/std/OECD-Measuring-Distance-to-SDG-Targets.pdf.
Legislation on sustainable development does not yet refer to the SDGs
Korea has made progress in incorporating sustainable development into its legislative framework. As it stands, Korea’s 2015 Sustainable Development Act (National Assembly, 2016) covers domestic policy actions, while the Framework Act on International Development Cooperation (National Assembly, 2010) governs international development commitments. As it moves forward in implementing this framework, Korea would benefit by clarifying how these pieces of legislation might fit together or complement each other, as well as how they relate to the SDGs as a framework for action.11 In addition, Korea’s memorandum (GoK, 2017a) states that Korea’s mid-term strategy (GoK, 2015a) provides guidance on policy coherence issues. However, while the memorandum also states that its policy coherence efforts will be implemented through Korea’s Third Basic Plan for Sustainable Development (adopted in January 2016), overseen by a Commission on Sustainable Development, it was unclear how policy priorities will be identified and whether the impacts on developing countries will be considered within this. These gaps and inconsistencies all need to be addressed as Korea begins to implement its national and international commitments to policy coherence for sustainable development in line with the 2030 Agenda for Sustainable Development.
Global awareness
Peer review indicator: The member promotes whole-of-society contributions to sustainable development
Despite some recent corruption scandals involving the aid programme, the Korean public is supportive of development co-operation, backed by comprehensive public education campaigns on international development and integration of global citizenship programmes into the school curriculum. The implementation of the 2030 Agenda is an opportunity to extend this work further, including through whole‑of‑society contributions to global public goods and sustainable development.
Korea prioritises spending on global development awareness
The Korean government places a high priority on developing and maintaining global citizenship values throughout the country, estimating that it spent 1.7% of total ODA in 2016 on raising and expanding public awareness of the aid programme and Korea’s broader contributions to inclusive development, peace and security, well above the DAC average allocation12. In addition, Korea sees its large volunteer programme (World Friends Korea) as a key tool for public engagement in development co‑operation (Chapter 5). As Figure 1.2 shows, when asked why Korea should provide aid, respondents most commonly cited Korea’s own relatively recent transition from being an aid recipient country and its corresponding responsibility to help other countries in need.
Figure 1.2. Public views on why Korea should provide aid
Source: OPM (2016), 2016 Public Opinion Survey on ODA, Office of the President, Seoul.
To deliver its key development communications messages on the rationale for giving aid and supporting the 2030 Agenda for Sustainable Development, Korea has developed a high-quality and innovative global citizenship programme to raise awareness of development assistance and the SDGs, and to remind domestic audiences of their duty to extend assistance to other countries, just as Korea itself was supported. These efforts include (but are not limited to):
integrating global citizenship education into the national school curriculum
hosting an interactive global citizenship exhibition facility at the headquarters of the Korean International Cooperation Agency
developing the ODA Korea website as a one-stop shop for aid programme information
releasing a short film13 on Korea’s journey from aid recipient to aid donor, with celebrity interviews on the lessons of Korea’s development success
disseminating lessons on evaluation through on-line learning forums and “card” news – a summary of aid evaluations (see Chapter 6)
displaying short films on the aid programme in public transportation
using television programmes and series showcasing development activities, inviting celebrities to visit programmes and communicating the results of selected loans
releasing a recent publication with general information on how Korea’s ODA works and how it is allocated, to further increase public and political awareness of planned reforms of the aid programme under the newly elected government (OPM, 2017).
Public support for the aid programme in Korea is high, at 86% (OPM, 2016). However, the Korean government is anticipating a slight drop in these high levels of support in its next survey, following an official enquiry and extensive media coverage of corruption allegations involving the aid programme in 2016. Further work will be required to re‑build public trust (see Chapters 4 and 6).
Korea could improve its transparency and involve civil society in public communication efforts
While acknowledging the high quality of Korea’s development communications efforts, the 2012 DAC peer review of Korea’s development co-operation (OECD, 2012) recommended that Korea disclose more comprehensive information on all aspects of its development co-operation in a way that is easy for key stakeholders – including parliamentarians, civil society, developing country partners and the general public – to access and understand. Since then, Korea has made commendable efforts in developing a useful “one-stop shop” ODA website and has joined the International Aid Transparency Initiative (IATI) (Chapter 4). However, while Korea provides good overall information on the objectives and scope of its programming, it can do more to improve the transparency of project-level financing and results. This is also an area where Korea’s civil society remains critical of the level of public information on Korea’s aid programme (KCOC, 2017). Korea recognises the need to extend its efforts in this area, noting that as it continues to work to fulfil its IATI commitments, information on aid quality for external stakeholders should improve (see Chapter 6). The 2030 Agenda for Sustainable Development presents a further opportunity to expand this communications work, in partnership with civil society and other key stakeholders, to raise awareness of new challenges and opportunities in a fast-moving development landscape (OECD 2016a, 2016b).
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Notes
← 1. The key elements behind Korea’s successful development performance have been extensively debated. The degree to which this performance should be credited to state-led development strategy and aid, and to what extent lessons from that experience might be relevant or applied elsewhere, are controversial. For a review of the literature see Noland (2011).
← 2. Korea has shared its development experience with developing countries since 1963, initially with funding from the United States Agency for International Development, but with its own resources since 1965.
← 3. Despite strong support for peacekeeping in South Sudan and Lebanon, these countries are not listed among Korea’s priority partners, with Korea choosing to delink its development co‑operation activities from its engagement in peacebuilding. See Chapter 7.
← 4. The G20 (or G-20 or Group of Twenty) is an international forum for the governments and central bank governors from 20 major economies.
← 5. ASEAN Plus Three (APT) is a forum that co-ordinates co-operation between the Association of Southeast Asian Nations and China, Japan and South Korea.
← 6. Since 2009, Korea’s foreign policy has focused on: “contributing to global peace and development under a broader vision and a more proactive approach to interacting with the international community” (Office of the President, 2009). This policy has been translated into four key diplomatic tasks as follows: (1) security diplomacy, particularly on the Korean peninsula; (2) diplomacy that contributes to global co-prosperity; (3) diplomacy that secures engines for future growth, particularly through trade and co-operation in the fields of energy and resources; and (4) diplomacy that serves the public, particularly the needs of Koreans abroad.
← 7. Korea is not party to the Convention on Cluster Munitions and Mine Ban Treaty.
← 8. While Korea’s agricultural subsidies and rigorous trade barriers remain a stumbling block for exporters in developing countries, Korea has made some progress in this area since the mid-1990s. As measured by OECD’s Producer Support Estimates, the share of transfers to agricultural producers from consumers and taxpayers in gross farm revenues declined from 66.9% in 1995-97 to 49.2% in 2016, but still it is 2.5 times higher than the OECD average (OECD, 2017c).
← 9. For more information see UNFCCC, Submission by Republic of Korea on 30 June 2015: Intended Nationally Determined Contribution (www4.unfccc.int/ndcregistry/, accessed 02/08/2017).
← 10. Korea, one of the UN’s early adopter countries of the SDGs, volunteered to participate as a pilot country in the OECD’s first SDG study, released in 2017. Note that only performance on SDG indicators with an impact on developing countries is discussed in this chapter.
← 11. Korea’s 2017 memorandum states that “[w]hile the implementation of SDGs in Korea is carried out by all relevant ministries, under the Sustainable Development Act, the country’s support for the international community’s sustainable development efforts is based on the Framework Act.” (GoK, 2017a). However, Korea’s 2016-20 mid-term strategy for development co-operation is aligned with the SDGs (Chapter 2).
← 12. In 2015, the DAC average for spending on raising development awareness was 0.2%.