Industrial Policy and Territorial Development

Lessons from Korea

image of Industrial Policy and Territorial Development

This report reviews the Korean catching up and it analyzes the recent reforms which have been put in place to address the territorial dimension in the design and implementation of industrial policies, with a view to share knowledge and policy experience with emerging and developing economies. Korea is a well known success case, but less is known about the efforts and reforms introduced to factor in the territorial dimension in its national development strategy.  

The report identifies the advances and challenges of the Korean approach to regional development. Results show that beside the specificities of the Korean experience it conveys several lessons for developing countries: i) Planning actions on a multi-annual basis is essential to achieve policy goals in fields such as industrial and regional development where policy outcomes depend on structural changes that will require long term horizons to be materialised and where coordination across several ministries (such as education, infrastructure and access to finance) is needed. ii) It is important to establish mechanisms that ensure a high level political support to regional development as well as to target resources to regions. iii) Supporting industrial development in regions requires designing specific programs beyond administrative boundaries. iv) The space for bottom up initiatives and regional empowerment has to be matched by a gradual approach to build the necessary capabilities at the regional level.



Country profile: Korea

Territorial and institutional framework

OECD Development Centre

Korea is a unitary country, with elected regional authorities since 1994. The capital of Korea is Seoul. Administratively, Korea is divided into seven metropolitan cities (Seoul, Incheon, Daejeon, Gwangju, Daegu, Busan, Ulsan) and nine provinces (Gyeonggi, Chungbuk, Chungnam, Jeonbuk, Jeonnam, Gyeongbuk, Gyeongnam, Gangwon, Jeju). In the document, provinces and metropolitan areas are referred to as provinces. Adjacent provinces and metropolitan areas are referred to as “regions” because they share a common culture and history. These regions are not administrative. The lower administrative level includes 232 bodies including Cities, Counties and Autonomous Districts.


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