Since the Korean War, South Korea has become one of the world’s leading economies- a far cry from the impoverished nation it once was. This is despite the nation suffering a major economic crisis towards the end of the twentieth century remedied amongst other things by an IMF agreement and a governmental commitment to reform.
Forward-thinking governmental restructuring has resulted in the country scoring incredibly high on the World Bank’s scale measuring how easy it is to do business in different countries. Indeed, regulatory efficiency, market openness and the South Korean government’s willingness to embrace foreign investment make doing business in South Korea a wise choice.
There has never been a better time to consider doing business in South Korea as post-registration procedures that previously needed to be adhered to when setting up a business have now been abolished. South Korea is described as ‘mostly free’ by the Index of Economic Freedom and businesses old and new will face little hindrance from government interference.
However, bribery and corruption are still commonplace – with even the country’s President being impeached on corruption grounds – and start-ups can still struggle to secure subsidies. Low levels of worker productivity, an aging population and a strained relationship with neighbouring North Korea all present large-scale obstacles to doing business in South Korea.
On a more day-to-day basis, the fact that South Korea is extremely influenced by Confucian values and ethics (almost more so than any other business culture) can lead to misinterpretations especially by differing Western countries. Confucian values include admiring those that appear ‘honourable’, a virtue earned through loyalty, hard work, respect for authority, consensus decision-making and time and effort spent on relationship-building. Hence why “Make a friend first and client second” is a well-known illustrative Korean saying.
The extensive bank of knowledge and tips available on the World Business Culture website will help anyone looking to do business in South Korea become well-versed in the country’s business and economic systems. The website also offers advice to equip business professionals with the skills needed to maintain inwha (harmony among people of equal rank) and successfully navigate the South Korean communication paradox of being non-confrontational yet emotional, stemming from the concept hahn.