Economic Implications of a Korean Reunification
Remember the inter-Korean summit that took place on the 27th of April, 2018? Being the first inter-Korean summit in 11 years, it was a historical moment for the two Koreas, especially because it was the first time for a North Korean leader to enter the territory of the South since the end of the Korean War in 1953- it ended with a truce, however, not a total agreement for peace.
Even though some viewed the past three inter-Korean summits (April, May, September 2018) with eyes of skepticism, many people considered this the very first step toward reconciliation and possibly, reunification of the two Koreas, although it wasn’t on the table explicitly. In fact, it seems like reunification is no longer an impossible dream.
Unfortunately, the majority of the younger generation in South Korea is pessimistic toward the idea of Korean reunification- about 6 out of 10 do not feel the need for reunification. Why are so many people against the reunification? Jin-Gi Choi, a lecturer in liberal arts for ETOOS Academy Co., said the answer to this question is quite simple: “the younger generation sets a higher value on creating a fair society than establishing peace and unity.” In other words, since they do not see an immediate payoff for all the costs and efforts needed in reunification, they view reunification as a major setback to South Korea’s economic growth.
In fact, the cost of unification, which arises from narrowing the economic gap between South and North Korea, is estimated to be over 4.6 trillion dollars, and it would fall heavily on the people of South Korea. Yet, according to Choi, 26.5% of Koreans are unwilling to contribute to paying for the cost, and 33.7% are willing to pay up to 100 dollars per year. Is the cost of unification too heavy a burden for the two Koreas?
The answer is no. If there is the cost to unifying two countries, there is the cost to being split up, which is called the ‘cost of division’. The truth is, the cost of unification is substantially less than the cost of division. The cost of division comprises of all the cost that has arisen and will arise from ongoing division between the North and the South, which includes higher-than-average expenditures of national defense, diplomatic costs, and expenditures for unification policy and unification education, etc. The reported national defense budget for 2018 only is 43 billion dollars, and a significant portion of it is due to the division of the two Koreas.
Maybe, now is the time for the South Korean public to rethink about their stance on reunification if it is the high cost of of unification that mainly holds them back from being optimistic about it.
Sources:
0hmyschool. YouTube, YouTube, 7 May 2018, www.youtube.com/watch?v=E86vyxJwi2g.
채널 단꿈 공식 유튜브. YouTube, YouTube, 5 Jan. 2016, www.youtube.com/watch?v=BY8fIF6EROE.
