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Topic: Geography
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If you look at a satellite image of the Korean peninsula, taken at night, will be able to see the great contrasts between the northern and the southern part of the island. The southern part, called for the Korean Republic, South Korea, is filled to the brim with points of light causing the land mass to resemble a small island broke away from mainland Europe. Darkness reigns in the northern part of the peninsula, in the Democratic People's Republic of Korea, North Korea.

The difference between communism and capitalism is obvious, of 50 years, the former Japanese colony of Korea, divided into an east and a west and created a contrast one can not ignore.
It was June 25, 1950 that North Korean troops marched into South Korea in an attempt to put the entire peninsula under an administrative power. US-led UN forces strewn quickly to Korea and established a strong defense of the country. During this time, the Soviet Union boycotted the Security Council, which made them unable to put a veto on the UN military maneuvers. Instead stood Communist China on the North Korean side. China and Russia were never "officially" in the war. To avoid a war with the United States determined that the Chinese troops would run over North Korean flag, such as freedom of troops. Russia never sent combat forces to Korea, but recently it has been shown that Russian pilots participated in air battles. The Korean War was, in other words, the first war where American troops fought against their Chinese and Russian counterparts.

The open battles were fought in the three years before the parties could agree on a ceasefire.
The conflict was based on the political differences between East and West that permeated the entire post-war period until the Berlin Wall 89 '. Before Japan's surrender at the end of World War II, the Korean Peninsula was a Japanese colony. However, stripped of Japan government in August 1945, and instead awarded the area in a Soviet occupied and an American-occupied zone. The border was drawn in line with the 38th parallel north. Soon, elections were held in the two areas and the two nations, the Democratic People's Republic of Korea (DPRK) and the Republic of Korea (South Korea) was established. Countries newly elected leaders, however, wanted both to reintroduce the whole Korean peninsula under the same flag, so why fighting broke out when the Soviet Union and the United States took home its forces.
After the armistice, North Korea's leader, Kim Il Sung, and the current Supreme Commander Kim Jong Il, has been the country's leader. The China-influenced Communist Party governing the country with a planned economy cerebral own, which has made North Korea into the world's most closed nations. South Korea was up to the war a military dictatorship but with America's help, just like Japan, has become a democracy in the Western auspices.
In this work, I have chosen to analyze the result of the political division of Korea. What are the factors that have made South Korea a growing industrial country and a powerful technological empire, while the sister state North Korea worked his way back to the Middle Ages?

Purpose and problem

The goal of this work is to demonstrate the huge differences between a communist and a capitalist state and to find out what could be done and could be done to make the communist society effectively, if it's even possible?

I will compare major industries with each other to be able to see the difference between the two political ideologies and thus be able to analyze what impact a nation's political leadership has on enterprises, and to what extent these companies can develop under present political circumstances. South Korea is a pure market economy while North Korea seems even more communist than China itself. I will also analyze the neighboring countries' activities and the impact they have had, and will have, on the Korean peninsula. How much is the capitalist Japan contributed to South Korea? What was the Soviet Union and the current role of Russia in the peninsula's political development and Thailand, together with the former SEATO countries contributed with democracy in any way?
What events have shaped the political and industrial development in South Asia and what is the future? Are there factors that suggest the unification of Korea, or North Korea dug his own grave in the nuclear test? What are the advantages and disadvantages of the two States against each other and how can these benefits be turned into a disadvantage, and vice versa?
The questions are endless, as is the material that describes the events after the Armistice. Because out of the infinite amount of information available on the Internet, I decided to limit myself to only a handful of questions. In order to make such an information rich ascribed as possible, while I myself should take lessons from Korea, I will develop the few questions I ask and squeeze in as much facts as possible, provided that I consider it necessary and relevant.
● What are the biggest differences between a kommunisk planned economy and a capitalist market economy and how these differences affected the two US industrial and economic development?
● What is North Korea's economy look like? How has the planned economy and the military regime affected the country's industrial development?
● How does South Korea's economy look like? How has the market economy and democracy affected the country's industrial development?
● When did North Korea's case? What could be done to prevent it and can save the country's economy and industry, without military means?
● When South Korea started to grow? The country will always be a major economic power, or represents its dictatorial neighbors, a threat?


I basically only used the Internet when I worked with the paper. By Wikipedia, I have found links to websites with historical and economic facts of the Korean peninsula. I have also used the Internet to look up books on the subject. I have worked with many websites, and especially during the portion, if the industry in the south, I have visited a plethora of different sides. To compile all the facts to a single work, I have written while I read, in other words, I have not gathered all the facts on paper and then build on them. New facts found during the time I have written and I have put in there, I think it suit best. I have not used the copy-paste method at all, because writing an essay by rewriting various sentences should not be counted as a regular essay to me.
In the work I also use some words and concepts for the uninitiated can seem quite difficult, because out of this, I have chosen to below list some of them for the reader to gain a greater understanding of what the work is about.
Corporation is the name of an association recognized as a legal person, then a company, association or the like which receive the same rights as a natural person. A corporation continues to exist even if the people in it went out.

Conglomerate is a group of companies, under the same name, but with different activities. As such, we take the American Boeing engaged in aerospace and military defense systems to the USAF. Danish Maersk is also a conglomerate that work with different kinds of transportation.

Tiger Economy is a term used for a State during a period feel of strong economic growth. The "East Asian Tigers" consisted of Korea, Singapore, Hong Kong and Thailand but only the first three managed to work his way back to a somewhat positive economic condition after the Asian crisis of 1997.

Planned economy is an economic system that was used in the former Soviet Union and its satellite states. The idea is that the state should regulate prices and control the market supply to thereby smooth out the class differences but also avoid sudden market fluctuations.

The market economy is an economic system that is used in today's Western World. In contrast to the planned economy controlled production of demand and market competition.


If communism and capitalism

Communism and capitalism are two very different ideologies, with two completely different economic systems. Communist countries use a monetary system called planned economy. Planned economy is a system where you are planning a country's production by administrative and political guidelines. The government, or the people, decide what goods and services should be available and what price to put on the goods sold. Issues such as schools, agriculture and healthcare are also determined by the central governing and not along the demand and supply. CPE has been the leading economic system of the world's current and former Communist states. Full communist ideology was based on the planned economic system. The state has full control over the production and consumption in the country and can thus smooth out the gaps between the classes.

The market economy can be said to be planned economy opposed. In a market determined the availability of goods and services, and its price, demand and market controlled by private parties rather than for a government as is the case in a planned economy. In a market economy is competition, which contributes to lower prices.
After World War II divided the world into two blocks. The western-based capitalist bloc and the Soviet-based Communist bloc. When the Korean War was over shared also in the Korean Peninsula in a west and an east, or in this case - a North and a South. North Korea became a communist state under the Soviet Union and South Korea became a capitalist city in NATO.

Initially developed communist North Korea faster than its southern neighbor. The planned economy in the impoverished country were quickly on their feet by the state regulated prices and thus could avoid, at this time, malicious competition. However, it has been shown that a market economy would have worked better in the long run. In the early 1970s, the Korean economy has grown stronger than the North Korean. The reasons for North Korea's economy plummeted in the late 60th century was partly because out of lack of financial support from other communist states, while South Korea had the whole Western world behind. Today, North Korea is the world's most isolated countries, while South Korea, like Israel and Thailand, has developed into a Western World Government in Asia.

North Korea's leader, Kim Il Sung has been dead since 1994, so the country is controlled by the Supreme Commander Kim Jong Il, who has tightened the reins around the communist North Korea, and among other things has built nuclear weapons. Kim is seen in his homeland as a god and people worship him. Since he was added as a de-facto leader in 1994, the Workers' Party of Korea built a personality cult around him, a cult in the West can be considered merely ridiculous. Rumors say for example that it ignited a new star when Kim was born and that he managed to beat the 11 hole-in-one during his first round of golf. South Korea is governed by the democratically elected Lee Myung-bak and his Grand National Party. Lee has previously been head of carmaker Hyundai.

If the industry in the north

The North Korean industry is mainly owned by the state, only 10% are privatized and it then moves on large companies that formed corporations with companies abroad, such as the automobile company Pyonghwa Autoworks (pyeonghwa motors), which has a monopoly in North Korea but competes in South Korea . It is the state that determines what should be produced and in what quantity. As the country's military dictatorship has been the most money on the military, industrial development, and consumer production thereof suffered. The North Korean economy is very protectionist, and the country has had to learn to cope on their own, 5% of the goods produced locally. You try so far as possible to refine their own, domestic products and avoids the import of foreign goods. The largest industry in North Korea's agriculture. But just as in most other industrial sectors in the country, agriculture is very inefficient. There is a shortage of fertilizer and machinery. The country also suffers from recurrent natural disasters and the local conditions in some regions is extremely unsuitable for cultivation, but they must still be used because out of the small area that is really fertile in the country. In the mid-1990s, North Korea was hit by severe erosion. Erosion is a movement or degradation of soil and rock caused by water, ice and gravity movements, much like an extensive weathering. In North Korea's case, this has meant that the country lost much of its arable land. The erosion in North Korea is usually due to flood or drought. Another reason for the low production is the major energy shortage in the country. During the Cold War subsidized Soviet Union North Korea with cheap oil, but after major power event, the country's industries had to go at half speed because you never invested in imports, and that there are many countries who want to trade with the Korean military regime.
The military regime is the country's biggest economic problems. The economic problem in North Korea may be one of the most extensive in the world. Starving people as a result of the ongoing, military build. Because the government refuses to release official figures regarding economic activity in the country it is difficult to determine how the situation really looks like, but the estimated budget, the North Korean government about 5 trillion USD of approximately 20 trillion USD of the state, military industry every year. In other words, an estimated 25% of the North Korean budget to renovate the army. That compares with the South Korean budget where budget 24 trillion USD of 1.196 trillion US each year.
However, it has recently opened up the industry a little and Chinese and South Korean companies have begun to export products and build factories. Especially Korea has been released into the country in recent years. In order to increase employment and reduce unemployment in North Korea, South Korean companies have built factories in the country where they hired North Korean labor. In North Korea, there is a company for every major industry. An aircraft manufacturer, a car manufacturer, and so on.
If the industry in the south

Unlike the North Korean planned economy as it uses the market economy system in South Korea, with some government influence on the market, as in Sweden. Free and healthy competition in the market and people can buy what they want and the amount of products and their prices are determined by demand. All this has made Korea the world's twelfth strongest economy. After the Japanese colonization and the Korean War, South Korea was one of the world's poorest countries. The free market economy led only to create cool cyclical holding back the economic development of the country. North Korea received much financial assistance from the Red Eastern bloc and China and the country's economy grew from South Korea, which was ravaged by including major corruption skeins at government level. In 1962, however, took General Park Chung-hee power through a military coup. He took out an economic line in the country that most resembled a five-year plan of the Soviet Union, but rather to nationalize the domestic enterprises, funded to them that they would be able to compete in the foreign market. The companies that are now able to ride on this wave of success was mostly conglomerates Kingdom and called chaebol firms. This economic "boom" was renamed the "Miracle on the Han River", named after the river that runs through the capital Seoul. In the mid-70s had Korea has adapted to the market economy and stabilized the oscillations, this created a rapidly growing economy and in interaction with democracy and human rights, increasing influence developed South Korea to South Asia's third strongest economic power.
Then came the Asian crisis. On July 2, 1997 devalued the economic superpower Thailand's currency, with the result that other Asian nations, including Tiger economy South Korea also was drawn into the case. Just like in the rest of South Asia, this led to high debt and large foreign loans. However, managed to Korea, unlike Thailand, to work his way back into a financially strong position, but it did not last long. In 1999, collapsed mammoth industry Daewoo, which had about 20 divisions below him. When the company went under, they had offices in over one hundred countries and debt went up to 84.3 million USD. The reason for the bankruptcy was due to the company, during the Asian crisis, acted as if nothing had happened. While other conglomerates based businesses such as Hyundai, Samsung and LG pulled down on their investments in order to cope with cyclical oscillation but Daewoo's CEO, Kim Woo-jung, started 14 new companies in the conglomerate. After the crisis fled Kim Woo-jung to France where he remained until June 2005.

The country is very poor in natural resources, so they have had to rely on imports. With the help of the huge amount of labor in the country has imported raw materials and then transform them into finished products that it exports. The textile industry is one of the industries that are purely national, there is no need to import raw materials from other countries. It also exports silk, cotton and tobacco, but in smaller amounts. South Korea is one of the world's largest steel producers, but the biggest source of income lies in the technology; electronics, machinery, cars and boats. The country's largest companies are Hynduai Group, which among other things engaged in car manufacturing and shipbuilding.

The fishing industry has also been a strong sector of the Korean economy, but after years of over-fishing as the country's position as one of the world's foremost fishing nations threatened. There is much that is "threatened" in South Korea because of the rapid development. The major industries emit quantities of greenhouse gases, although about 40% of the country's energy comes from nuclear power increases the emissions from coal-fired plants.
A private company in Korea has much better conditions than in North Korea. The market economy allows free competition and there are no restrictions on how much they can produce and what it may employ.

Discussions and conclusions

The red economy

North Korea is today the world's most isolated nation. The military regime of Kim Jong Il at the head prioritize a heavy military industry particularly efficient agriculture. The economic situation in the country has been poor ever since the Communist bloc case but the government does nothing to reverse the negative trend. However, there is light in the tunnel, in that Korean companies received permission to build factories in North Korea, the South Korean commodities and North Korean labor.

The results of this study showed only what you expected, - a strong contrast between the two sister nations. In only a little more than 50 years, the two states developed in such a different way that the uninitiated might think that the story is fictional. It is not very surprised by the results that emerge when one examines the country's budget. But then one wonders; why?

Protectionism reigns in Kim Jong Il's kingdom and there is nothing to suggest that the country should open up its borders further. Most likely, you use the economic and political system to maintain authoritarian rule over the peninsula as long as possible. A proof of this is also the cult of personality that the regime built up over the years. In South Korea have recently begun with an economic policy which includes trying to control the neighboring country to economic stability. It could be done is to continue with the building of foreign enterprises in North Korea that in any case increase employment. But to get a total end to communist rule think in any case I needed direct military action by NATO economic sanctions from the UN will help only in the short term, but because the regime in the country has free access to all luxury goods, import and export as they never quite feel the pressure as abroad creates. It is the people who suffer and Kim Jong Il government has never done anything about it, and will not do either. With North Korea's nuclear test in 2006, they have taken a further step towards the total isolation from the outside world.
The blue economy
South Korea has rapidly grown from one of the world's poorest countries to one of the world's richest. The reason for the rapid economic growth is the only democracy, and the opportunities that it brings. Human free will is not regulated by laws and economic system and therefore people are free to think and come up with creative solutions, such as in the case of the "Miracle on the Han River". South Korea, like Japan, have distinguished themselves for an extremely efficient labor, and this, together with the lack of raw materials, meant that the country has had to rely on imports of foreign materials and export of finished products. But just like any other market economies, Korea is dependent on their companies. As Daewoo bankruptcy showed, small, economic missteps lead to catastrophic crises, both nationally and internationally. Because the country is a full-fledged democracy, there is nothing the government can do to prevent future slips in the economic sector.

The different economic conditions that occurred in the two countries since the 50s has contributed to a devastating division of the former, united people. In just 50 years, the land of the north evolved backward, while in the south developed country forward at a furious pace. This demonstrates the enormous difference between communism and capitalism, dictatorship and democracy.


After the Korean War divided the Korean peninsula between the capitalist West and the communist East. Over the years, this sharing demonstrated the differences between a "red" and "blue" state.
In the beginning was the North Korean economy is good because of the assistance they received from other communist states. Neighboring South Korea was rated as one of the world's poorest. But when the Eastern bloc later fell was North Korea alone, without allies, and only some twenty years before Korea had undergone an economic boom. The roles were reversed. While South Korea took advantage of its large labor supply focus was almost exclusively on the military industry in North Korea, which, in conjunction with the harsh dictatorship and its planned economy, led to the people starved. In the mid-90s, North Korea, the world's most isolated country while South Korea was one of the world's richest.
When the Asian crisis was a fact belonged to South Korea Asia's economic elite and could quickly work his way back to the economic golden age they lived in during the past decades. But as that Korean companies grew, shrank the small industry which still worked in North Korea. Erosion tore away and destroyed large areas of arable land in the country, which also contributed to the worsening economic situation, because North Korea has always been self-sufficient, and the main industry is bright agriculture. The military regime under Kim Jong Il in the country has always pursued a large-scale isolation policy and has refused to cooperate with the West. South Korea on the other hand has been forced to cooperate with other countries as the lack of raw materials in the country is enormous. Therefore, feeding it in importing its then export them as finished products.
Today, Korea is the world's twelfth most powerful economy, the neighboring country is the world's most isolated nation. South Korea is expanding as an economic power all the time, while North Korea builds nuclear weapons to "defend themselves against the West."

Christoffer Jonsson

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