South Korea

Politics:

• Analysis

  South Korea politics: Park Geun-hye makes an uncertain start

  More than a month after Park Geun-hye began her five-year term on February 25th as South Korea's first female president, she finally has a government. This delay could have been avoided, as several of her appointees have been forced to resign, mostly over ethical allegations that should have been caught at the vetting stage. As a result, Park Geun-hye has struggled to build any momentum at a time when tensions on the Korean peninsula are high and rising.

  The latest casualty, Han Man-soo, who was nominated to head the anti-trust Fair Trade Commission (FTC), withdrew on March 25th, after media reports alleged that he evaded tax by using offshore bank accounts. As a tax lawyer known for defending chaebol (conglomerates), he was, in any case, an odd choice for the job. Three days earlier, Kim Byung-kwan, the prospective defence minister, finally cancelled his candidacy after weeks of criticism. The last straw was a photograph of him in Myanmar as part of a delegation of investors in a gas company, an interest he had not disclosed. Instead, the incumbent minister, Kim Kwan-jin, is to stay on. With North Korea making ever fiercer threats, this has been an awkward time for the defence portfolio to be vacant.

  A chauvinist streak

  Other allegations made against prospective ministers have been more dubious. Kim Byung-kwan's lobbying for a German arms maker was no crime (unfortunately, some imported tank parts proved faulty), but many in Seoul's corridors of power deemed it unpatriotic. Park's best appointee, Kim Jeong-hoon, a Korean-American engineer-entrepreneur and head of Bell Labs (a US-based firm), quit in frustration on March 4th over the blocking by the opposition Democratic United Party (DUP) of Park's plan to create a new Ministry of Future Creation and Science (MFCS), which Kim was to head. The DUP jumped on criticism of his US citizenship, which he was about to give up.

  Other casualties include Kim Hak-ui, nominated to become vice-minister of justice, who resigned on March 21st amid allegations of sexual impropriety, which he denies. Park's first choice for prime minister-Kim Yong-joon, a former senior judge-withdrew on January 29th amid allegations over past real estate dealings and the fact that his sons had avoided unpopular military service.

  Secretive style

  The indiscretions, proven or alleged, of the potential ministers has been an embarrassment for the president, particularly given a previous pledge to end the corruption that felled many choices made by her predecessor, Lee Myung-bak. Park Geun-hye herself has been widely blamed for the debacle. Her decision making has been characterised as secretive, and her reluctance to delegate means that the failures of the vetting process have fallen on her. Her approval rating has declined from 67% after her election on December 19th, to 52% as of March 22nd.

  Park Geun-hye has also struggled with the DUP's hostility to her reorganisation of government, which finally came into law on March 22nd. In the past, she could have used her Saenuri party's majority in the National Assembly (parliament) to force through her changes. However, under a new law designed to end parliamentary fisticuffs, bills can only be put to a vote if both main parties consent.

  There were two focal issues that caused the delay. The DUP's objection that the MFCS would give the government too tight a control over broadcasting was specious, although the administration of Lee Myung-bak did meddle in media appointments. Moving trade diplomacy from the foreign ministry to a renamed Ministry of Trade, Industry and Energy may be more questionable, with negotiations on a free-trade agreement (FTA) with China set to accelerate soon. Elsewhere, the Ministry of Strategy and Finance has once more come within the purview of the deputy prime minister, and the Ministry of Maritime Affairs and Fisheries has been reinstated. Lee Myung-bak had abolished both.

  Policies unclear

  Given Park Geun-hye's stumbling start, it remains difficult to discern the likely direction of her administration's policies. For business, a major issue is how far the rhetoric of "economic democracy", which was prominent in the president's campaign, will drive her agenda. South Korea needs welfare and labour-market reforms, as the OECD has long noted. An FTC raid in February 2013 on the Korea Automobile Importers and Distributors Association, alleging price collusion, smacks of the bad old days, when buying a foreign car risked a tax audit.

  One area where policy is both clear and surprising is North Korea. In contrast to her hardline predecessor, Park Geun-hye's commitment to "trustpolitik" seems undiminished by Northern threats. The academic behind this approach, Ryoo Kihl-jae, is the new unification minister. On March 27th, even as the North told her to "watch her tongue" and cut a military hotline used for border crossings to the joint-venture Kaesong Industrial Zone, she reiterated her commitment to peace-building "brick by brick". Despite current tension, Ryoo Kihl-jae approved a non-governmental organisation's (NGO) sending medical aid; he hopes to resume long-suspended family reunions this year. A "green détente" plan to fight deforestation in the North is also mooted. Some Seoul media criticised this stance as untimely; however, keeping calm and thinking long-term may prove to be no bad thing.

  March 27, 2013

• Background

  South Korea: Key figures

  Lee Myung-bak

  A forceful former executive of Hyundai, once the country's leading chaebol (conglomerate), and ex-mayor of the capital, Seoul, Lee Myung-bak was elected president by a landslide in December 2007. His conservative Grand National Party (GNP) won a slim majority in the National Assembly (parliament) polls in April 2008. Despite this dual mandate, several unwise political appointments and other gaffes have made Lee Myung-bak unpopular with large segments of the population: He may become a lame duck during the last year of his term (South Korean presidents can hold office for just one five-year term), which concludes in early 2013.

  Park Geun-hye

  A daughter of Park Chung-hee, the dictator from 1961 to 1979 who laid the foundations for South Korea's industrial growth, Park Geun-hye led the GNP from 2004 until she stepped down in 2006 to run for president. Defeated for the nomination by Lee Myung-bak, Park Geun-hye remains a power in the GNP's heartland, the south-eastern Gyeongsang region, and controls a bloc of about 60 GNP and other party members of the National Assembly. Park Geun-hye and the president remain at odds over several policy issues, as well as Lee Myung-bak's failure to support her presidential ambitions: if Park Geun-hye does not win the party's presidential nomination, she could run independently, splitting the conservative vote.

  Chung Mong-joon

  One of South Korea's richest men as chief shareholder of a leading shipbuilder, Hyundai Heavy Industries, Chung Mong-joon ran for president as an independent in 2002, but withdrew in favour of Roh Moo-hyun of the Millennium Democratic Party (a forerunner of the Democratic Party, or DP) in order to block the GNP candidate, Lee Hoi-chang. A long-time independent member of parliament for the constituency of Ulsan, where Hyundai has its headquarters, in 2007 Chung Mong-joon joined the GNP and in 2009 became its chairman. Although he resigned from the post after the party's defeat in local elections in June 2010, he may still harbour presidential ambitions.

  Chung Dong-young

  After being defeated in the presidential race by Lee Myung-bak in 2007 as the centre-left candidate and losing his parliamentary seat in April 2008, Chung Dong-young returned to politics with a landslide by-election win as an independent in April 2009. Factionalism meant that the main opposition DP denied him entry at first, but the party has now embraced him. He could be a contender in the 2012 presidential election.

  Sohn Hak-kyu

  Chung Dong-young may run for president again, but if he does he will face competition from the DP's more moderate current leader, Sohn Hak-kyu, whose position has been boosted by his victory in a by-election in a hitherto conservative area in April 2011.

  Oh Se-hoon

  Not yet 50, a lawyer, Oh Se-hoon, succeeded Lee Myung-bak as mayor of Seoul in 2006. Narrowly re-elected in 2010 despite a strong swing towards the DP, his young and modern image renders him well placed to seek the GNP's presidential nomination in 2012.

  July 25, 2011

• Structure

  South Korea: Political structure

  Official name

  Republic of Korea

  Form of state

  Presidential system; the president and the National Assembly (parliament) are directly elected; members of parliament (MPs) are elected using a mixed system of first past the post and proportional representation

  The executive

  The president (elected for a single term of five years) appoints the State Council (cabinet), which comprises the president, the prime minister and 15-30 ministers. Cabinet ministers are not normally members of the National Assembly

  Head of state

  Elected president

  Legislature

  Unicameral Kuk Hoe (National Assembly) elected for a four-year term. The new assembly, which was elected in April 2012, has 300 seats. Most of the assembly's seats are filled by election from geographical constituencies, with the remainder distributed among the various parties in proportion to their shares of the national vote. The conservative Saenuri Party (formerly known as the Grand National Party) has 149 MPs, and the main opposition centre-left Democratic United Party (DUP) has 127

  National elections

  April 2012 (parliamentary), December 2012 (presidential). The next parliamentary election will take place in 2016, while the next presidential poll will be held in December 2017

  National government

  Park Geun-hye, of the ruling Saenuri Party, was inaugurated as president in February 2013

  Main political organisations

  Saenuri Party, DUP, Unified Progressive Party, Progressive Justice Party, Forward Unification Party (formerly the Liberty Forward Party)

  Main members of State Council

  President: Park Geun-hye

  Prime minister: Chung Hong-won

  Key ministers

  Defence: Kim Byung-kwan (not yet confirmed)

  Employment & labour: Phang Ha-nam

  Foreign affairs: Yun Byung-se

  Health & welfare: Chin Young

  Knowledge economy: Yoon Sang-jick

  Land, transport & maritime affairs: Suh Seoung-hwan

  Strategy & finance: Hyun Oh-seok

  Unification: Ryoo Kihl-jae

  Central bank governor

  Kim Choong-soo

  March 18, 2013

• Outlook

  South Korea: Key developments

  Outlook for 2013-17

  • Park Geun-hye became president on February 25th, but some members of her cabinet have yet to be approved by parliament and there is continuing opposition to her plans to reorganise several government departments.
  • The election of the conservative Park Geun-hye broadly represents continuity rather than change. She will maintain her predecessor's pro-business approach, although she will take steps to rein in the chaebol (conglomerates).
  • The president has pledged greater engagement with North Korea, but recent provocative acts and aggressive statements by the North will make this much harder for her.
  • The Economist Intelligence Unit forecasts that real GDP will grow by 2.8% in 2013, underpinned primarily by private consumption growth. The economy will then expand by an average of 3.9% a year in 2014-17.
  • In 2013 consumer price inflation is expected to be just below the 2.5-3.5% target range for 2o13-15 set by the Bank of Korea (South Korea's central bank), at 2.3% on average. In 2014-17 price rises will average 3% a year.
  • The current-account surplus will rise slightly in 2013, to the equivalent of 4.4% of GDP, owing mainly to a modest recovery in export growth. It will then average 3.6% of GDP in 2014-17.

  Review

  • On March 10th Park Geun-hye held her first cabinet meeting, fully two weeks after her inauguration. The delay was owing to disputes over her ministerial nominations and a bill to reorganise a number of government departments.
  • In March North Korea threatened "pre-emptive" action against its enemies and abrogated its non-aggression pacts with the South. Park Geun-hye has pledged strong action in response, but her options are limited in practice.
  • The president has set out plans for a "paradigm shift" in the country's economic management, with social welfare, and growth with equity, to be the defining concepts.
  • The central bank has reported a current-account surplus of US$2.3bn in January, with a US$930m deficit on services. The January outturn extended South Korea's streak of monthly current-account surpluses to 12 months.
  • Consumer price inflation averaged 1.4% year on year in February, down marginally from 1.5% in January. An interest rate cut is nevertheless unlikely.
  • Merchandise exports fell by 8.6% year on year in February. In the first two months of 2013 the value of exports amounted to US$88bn, up by just 0.6% year on year.

  March 18, 2013

Economy:

• Background

  South Korea: Country fact sheet

  Fact sheet

  Annual data	2012a	Historical averages (%)	2008-12
  Population (m)	50.0	Population growth	0.6
  GDP (US$ bn; market exchange rate)	1,130.1	Real GDP growth	2.9
  GDP (US$ bn; purchasing power parity)	1,562	Real domestic demand growth	1.6
  GDP per head (US$; market exchange rate)	22,604	Inflation	3.3
  GDP per head (US$; purchasing power parity)	31,246	Current-account balance (% of GDP)	2.8
  Exchange rate (av) W:US$	1,126b	FDI inflows (% of GDP)	0.3
  a The Economist Intelligence Unit estimates. b Actual.

  Download the numbers in Excel

  Background: Korea was subjected to colonial rule by Japan from 1910 to 1945, and then to partition by the US and the Soviet Union in 1945. The subsequent war between the two Koreas in 1950-53 cost 4m lives, but neither side won. The first summit between the Republic of Korea (South Korea) and the Democratic People's Republic of Korea (North Korea) was held in 2000. Regular contact subsequently led to a cautious thaw in bilateral relations, despite the North's nuclear programme. But since 2008 political relations have deteriorated again, and a new nadir was reached following the shelling by North Korea of a Southern island in 2010. South Korea joined the OECD in 1996.

  Political structure: Following two military coups and several decades of authoritarian rule, since the 1990s South Korea has been a democracy. The constitution provides for a directly elected president who appoints the prime minister and the cabinet. Presidents serve a single five-year term. There is a unicameral National Assembly (parliament), elected at four-yearly intervals. Park Geun-hye of the conservative Saenuri Party won the December 2012 presidential election and replaced Lee Myung-bak in the post in February 2013. The Saenuri Party also won the April 2012 parliamentary election.

  Policy issues: The Saenuri Party-led government will continue to pursue a business-friendly and economic growth-oriented agenda. Policy is currently focused on fiscal stimulus and the maintenance of an accommodative monetary stance in order to support the economy and fend off risks stemming from economic weakness on the part of the US and the EU. The Bank of Korea (South Korea's central bank) will need to strike a balance between stimulating the economy and maintaining price stability. High levels of household indebtedness are a concern.

  Taxation: Corporate income tax rates range from 10% to 22%. Companies are also subject to a residency surtax applied at a rate of 10% of corporate tax liability. Personal income tax rates range from 8% to 38%. In addition, a residency surcharge of 10% of income tax liability is applied. The value-added tax (VAT) rate is 10%.

  Foreign trade: In 2011 merchandise export revenue grew by nearly 20%, to US$553bn, while the value of merchandise imports rose by nearly 24%, to US$522bn.

  Main exports 2011	% of total	Main imports 2011	% of total
  Information & communication products	13.1	Petroleum & petroleum products	17.6
  Semiconductors	9.6	Electrical machinery, apparatus & appliances	11.5
  Chemicals	9.5	Gas	8.5
  Machinery & equipment	9.3	Iron & steel	8.3
  Leading markets 2011	% of total	Leading suppliers 2011	% of total
  China	24.2	China	16.5
  US	10.1	Japan	13.0
  Japan	7.1	US	8.5
  Hong Kong	5.6	Germany	3.2

  Download the numbers in Excel

  Download text file (csv format)

  March 18, 2013

• Structure

  South Korea: Economic structure

  Data and charts: Annual trends charts

  
  

  

  March 18, 2013

• Outlook

  South Korea: Country outlook

  South Korea: Country outlook

  FROM THE ECONOMIST INTELLIGENCE UNIT

  POLITICAL STABILITY: Park Geun-hye of the Saenuri Party became South Korea's first female president in late February. Her victory in the December 2012 presidential election represents continuity rather than change. In a close race against her main opponent, Moon Jae-in of the main opposition Democratic United Party (DUP), Park Geun-hye secured 52% of the vote. She leads an administration that will maintain the broadly pro-business approach of her predecessor as president and Saenuri Party colleague, Lee Myung-bak. Following the April 2012 election to the National Assembly (parliament), the conservative Saenuri Party has 149 seats out of 300 in the legislature, compared with a total of 140 for the liberal DUP and two smaller opposition parties, the Unified Progressive Party, which has six seats, and the Progressive Justice Party, which has seven. The Saenuri Party's tally of seats, in combination with support from minor parties and independents, in theory gives the new president the ability to push legislation through parliament.

  ELECTION WATCH: The Saenuri Party dominates the legislature and has retained control the presidency following Park Geun-hye's December 2012 election victory, but it will need to beware of complacency. The presidential race was very close, and exit polls suggest that Park Geun-hye had only limited success in winning over younger voters. Her filial connection with Park Chung-hee (South Korea's president between 1961 and 1979, who oversaw major economic reforms) worked in her favour with voters of her own generation, but younger people are put off by her family link with a president who also curtailed political freedoms. In the April 2012 parliamentary election, against all expectations, the Saenuri Party won the most seats, but there was a significant leftward shift in the vote. The manner in which Park Geun-hye and her party manage the economy, in particular, will be crucial in determining how the Saenuri Party performs at the next parliamentary poll in 2016 and in any by-elections held before then.

  INTERNATIONAL RELATIONS: In the short term, the president's main foreign policy priority will be relations with North Korea. Prior to her election, Park Geun-hye pledged greater engagement with the North. However, North Korea's launch of a satellite late last year (in practice a missile test) and its nuclear-weapon test in February will make this more difficult. The international community responded to the North's provocative behaviour by imposing new UN sanctions, but this has provoked a predictably fierce response the North Korean government, which in early March threatened "pre-emptive" action, abrogated its non-aggression pacts with South Korea and closed communications channels. Park Geun-hye's government has promised "strong action" against any future aggressive moves by the North, and in the early part of her term the new president will focus on security and will act in concert with South Korea's allies, leaving scant scope for creative diplomacy with the North. The risk of major conflict remains small, but North Korea may carry out further attacks resembling those in 2010, when it sank a Southern naval vessel and shelled a nearby island.

  POLICY TRENDS: Park Geun-hye's administration is expected to maintain a broadly pro-business approach in 2013-17. The government's main challenges will include addressing the problems posed by South Korea's falling fertility rate and ageing population. To this end, the president aims, via her concept of a "creative economy", to focus on enhancing innovation in order to boost growth, create new markets and generate jobs. Particular emphasis will be placed on boosting information technology and other technological fields, in the hope of transforming South Korea's services sector. The president also plans to enhance support for small and medium-sized enterprises by improving access to finance. None of this is particularly new, although Park Geun-hye will do more than her predecessor to restrain the powerful chaebol, for example by banning new cross-shareholding arrangements between chaebol (existing such investments will not be affected). On the whole, however, she will remain favourably disposed towards to the conglomerates, which play a major role in the economy. Potentially more controversial are the president's plans to expand welfare spending, which her opponents say have not been properly costed.

  ECONOMIC GROWTH: We expect real GDP growth to accelerate to 2.8% in 2013, from 2.1% in 2012. Private consumption will be the main driver of economic expansion this year. Expansion in private consumption will be facilitated by low interest rates, welfare initiatives by the government that will increase incomes, and more readily available credit. Fixed investment growth will remain sluggish in 2013, at 1.2%, owing to the still subdued state of the housing sector. A modest acceleration in global economic growth will result in a slight improvement in the performance of South Korea's external sector this year, with exports of goods and services forecast to expand by 3.9%. However, overseas trade will continue to play only a minor role in driving GDP growth, as expansion in imports of goods and services will also accelerate in 2013, to 3%, as a result of growth in private consumption and exports.

  INFLATION: We have revised down our forecast of average consumer price inflation in 2013, to 2.3%, from 2.6% previously, to reflect recent data releases. Although inflation will accelerate marginally this year from 2.2% in 2012 as the domestic economy strengthens slightly, it will be below the range of 2.5-3.5% targeted by the Bank of Korea (South Korea, the central bank) for the next three years. In 2014­17 we expect annual inflation to average 3%. The rate of inflation in South Korea will be affected by international petroleum prices (dated Brent Blend); South Korea is the world's fourth-largest importer of oil. The Economist Intelligence Unit expects average oil prices to decline by around 6.7% this year, from US$112/barrel to US$104.5/b. The country is also a large importer of food, and is therefore affected by world food prices, which we also expect to decline in 2013, by 4.2%. In addition, price rises will be kept in check during the forecast period by the strengthening of the won against the US dollar, which will help to limit imported inflation. There could be significant deviations from our inflation forecast, however, primarily owing to the volatile outlook for global commodity prices. For example, such prices could fall steeply if China's economy experiences a sharp slowdown.

  EXCHANGE RATES: Owing to the openness of the South Korean economy and the attractiveness of the country's financial markets, the won will remain vulnerable to sudden changes in value in 2013-17. The currency has appreciated steadily since May 2012, and in November financial regulators moved to try to curb the won's rise by tightening regulations on currency forward positions at domestic and foreign banks. The rule changes, along with an interest rate cut in October 2012 and the likelihood that the BOK will keep monetary policy accommodative in the coming period, point to a likely weakening of the won in early 2013, but we expect the currency to appreciate in 2013 as a whole, to W1,093:US$1 on average. The Japanese authorities' expanded asset-purchase scheme, announced in January, is causing the yen to depreciate against the won. This has implications for the external sector, since the cheaper yen will make Japan's exporters more competitive relative to their South Korean counterparts, which trade many similar types of goods. As the government begins to raise interest rates from late 2013 the won will start to appreciate, and will average W1,035:US$1 in 2016. The currency's rise will also reflect the economy's steady productivity gains and the strength of South Korea's current-account position as macroeconomic fundamentals improve. The country's financial markets will remain among the most open in Asia, meaning that exchange-rate volatility could be high, especially if international foreign-exchange markets remain unstable. Notably, elevated tensions with North Korea could put downward pressure on the won's value.

  EXTERNAL SECTOR: The current-account surplus rose strongly, to an estimated 4.3% of GDP, in 2012. We forecast that the surplus will continue to grow in 2013-14, if at a slower pace, as export growth recovers. In the latter part of the forecast period the current-account surplus will fall, as the merchandise import bill grows more strongly owing to expanding domestic demand and South Korea's reliance on imports to meet the bulk of its energy needs. On the services account, spending by outbound tourists from South Korea will exceed the country's tourism earnings. However, South Korea will be a significant exporter of transport services, and this will help to keep the services account in surplus during the forecast period. The income account will remain in surplus in 2013-17, as outflows of profits on foreign investments in South Korea will be offset by inflows from the substantial stock of assets held abroad by local firms. The country imports a large amount of oil. It is therefore vulnerable to instability in producer countries (especially in the Middle East), as this would be likely to cause global oil prices to rise, in turn adversely affecting South Korea's current-account position.

  March 25, 2013

• Forecast

  South Korea: Country forecast summary

  Country forecast overview: Highlights

  • In February Park Geun-hye became South Korea's new president, succeeding her Saenuri Party colleague, Lee Myung-bak. Her rule broadly promises continuity rather than change: she will maintain a pro-business approach, but will take steps to rein in the power of the chaebol (industrial conglomerates).
  • The Saenuri Party holds the largest number of seats in the National Assembly (parliament), with 149 out of 300, compared with 140 seats for the three main opposition parties combined. This should ensure that Park Geun-hye can implement her legislative agenda. In practice, however, it is not certain that she will be able to command the full support of her party, owing to internal policy disagreements.
  • The new president has pledged greater engagement with North Korea than under her predecessor, but the North's satellite launch in late 2012 and its nuclear-weapon test in February this year will make this more difficult. In early March North Korea abrogated its non-aggression pacts with the South and threatened pre-emptive military action against "aggressors" (primarily meaning the US). However, it has made similar threats before, and it is unlikely that it has the ability to strike the US with its missiles. Aggressive action closer to home, against South Korea, is a more likely-if still slim-possibility.
  • The Economist Intelligence Unit expects the Bank of Korea (BOK, South Korea's central bank) to keep monetary policy accommodative until late 2013. Policy will then be tightened only gradually, as higher interest rates raise the cost of investment (so hurting South Korea's highly leveraged household sector), and attracting hot money (causing the won to strengthen and thus hitting exporters).
  • Domestic demand will expand steadily in the forecast period, although initially it will be constrained by a subdued housing market and high household debt levels. The subdued economic outlook for a number of South Korea's major export markets, including Europe, will limit the contribution of net exports to economic expansion. Real GDP is forecast to grow by 2.8% in 2013.
  • The won will appreciate against the US dollar in 2013 and will remain on a strengthening trend during the remainder of the forecast period, in line with South Korea's strong economic fundamentals. Tighter rules on currency forward positions at domestic and foreign banks were implemented by the authorities at the start of 2013 in an effort to curb the won's rise. Annual consumer price inflation will average 2.8% in 2013-17.

  Country forecast overview: Key indicators

  Key indicators	2012	2013	2014	2015	2016	2017
  Real GDP growth (%)	2.1	2.8	3.8	3.9	4.0	4.0
  Consumer price inflation (av; %)	2.2	2.3	2.8	2.9	3.1	3.1
  Budget balance (% of GDP)	1.7	2.6	2.9	2.7	2.5	1.9
  Current-account balance (% of GDP)	4.3	4.4	4.3	3.7	3.5	3.2
  Commercial banks' prime rate (av; %)	5.6	6.0	6.5	7.4	7.5	7.5
  Exchange rate W:US$ (av)	1,126.5	1,092.6	1,076.9	1,041.0	1,035.0	1,040.0
  Exchange rate W:¥100 (av)	1,407.8	1,178.0	1,139.5	1,081.6	1,061.5	1,077.7

  Download the numbers in Excel

  Download text file (csv format)

  March 18, 2013

View detailed map

Country Briefing

Land area

99,678 sq km

Population

49.8m (2011; National Statistical Office)

Main towns

Population in '000 (2010):

 Seoul (capital): 9,895

 Busan: 3,663

 Daegu: 2,481

 Incheon: 2,475

 Daejeon: 1,368

 Gwangju: 1,414

Climate

Continental, with extremes of temperature

Weather in Seoul (altitude 87 metres)

Hottest month, August, 26.5°C; coldest month, January, minus 0.4°C; driest month, January, 10.8 mm average rainfall; wettest month, July, 274.1 mm average rainfall

Language

Korean

Measures

Metric system. Some local measures are:

 1 pyong = 3.3058 sq metre

 1 chungbo = 0.992 ha

 1 suk = 100 dai = 180.39 litres

 1 kwan = 1,000 don = 3.75 kg

Currency

Won (W). Average exchange rate in 2012: W1,127:US$1

Time

9 hours ahead of GMT

Public holidays

January 1st (New Year's Day); February 9th-11th (Lunar New Year); March 1st (Independence Movement Day); May 5th (Children's Day); May 17th (Buddha's Birthday); June 6th (Memorial Day); August 15th (Liberation Day); September 18th-20th (Chuseok holidays); October 3rd (National Foundation Day); October 9th (Hangeul Day); December 25th (Christmas Day)

January 10, 2013