Park Chung-hee and the Export Drive

How South Korea's government under Park Chung-hee pushed firms to export, using targets, cheap loans and discipline, and the authoritarian side of this model.

Park Chung-hee seized power in 1961 and ruled until 1979. His government made exports the centre of economic strategy.

How it worked

Export targets: firms were given targets, and monthly meetings reviewed progress.
Cheap credit: the government controlled banks and directed loans to exporters.
Rewards for firms that met targets; penalties for those that didn’t.
Five-year plans guided investment.
A weaker currency made exports competitive.

Discipline

Unlike import substitution in some countries, Korean firms had to compete in world markets. Failure to export meant losing support. This export discipline pushed firms to improve quality and productivity.

The dark side

Park’s rule was authoritarian, with suppression of labour unions and political opponents.
Workers faced long hours and low wages in early decades.

Democratisation

South Korea became a democracy in 1987 after mass protests, and continued growing.

The monthly meeting

At monthly export promotion meetings, government officials and business leaders reviewed export figures, and firms that met targets received more loans and recognition.

Thinking Korea's growth came from free markets alone

The government actively directed credit and set export targets.

Key takeaways

Park Chung-hee ruled from 1961 to 1979 and pushed exports.
The government used targets, cheap credit and rewards.
Export discipline forced firms to compete globally.
The model was authoritarian; democracy came in 1987.