Pearls and Irritations

Korea has won plaudits globally for its response to COVID-19. Despite Korea being one of the first countries hit hard by the pandemic, its swift response is paying dividends as its population have been able to avoid large scale lockdown and high fatality rates. With a high reliance on exports, South Korea has also managed to keep its borders open, limiting the extent of economic devastation.

The timing of this worldwide praise has come at a good time for President Moon Jae-In and his Democratic Party. On April 15, South Koreans went to the polls to elect 300 lawmakers to serve in the National Assembly, and Presidents Moon’s Democratic Party claimed the biggest majority in the National Assembly since 1987 when Korea transitioned to democracy. Remarkably, the election saw the highest voter turnout in 28 years, an achievement it itself alone let alone during a pandemic. The dominance of COVID-19 in the news and widespread praise of how Korea has handled the pandemic has meant that other issues which have not been handled so well by the government, including unemployment, corruption scandals and failure to progress talks with North Korea have been pushed to the side. Winning by such a big margin will now allow President Moon to push through his agenda with ease in the remaining two years he has left in his single five-year term.

South Korea’s strong handling of the crisis is putting a spotlight on our bilateral relationship. Despite being a major trading partner of Australia, South Korea is usually pushed to the side by the media in favour of the threatening and more lucrative news stories involving North Korea. Now, South Korea is dominating global media channels, all eager to learn what lessons we can apply domestically to flatten the curve. This spotlight comes at an important time in the Australia-Korea bilateral relationship – this year marks our 60^th year of diplomatic relations with Korea. Prior to COVID-19 we were expecting a Presidential visit from Moon to Australia in July, however, it looks like this will now be a virtual summit.

The South Korean government publicly released a document that outlines its 3Ts approach (Technology, Testing and Tracing) to respond to the COVID-19 crisis. The question is, if we apply these three t’s to other countries, would the results be the same? To some degree yes, but Korean’s history has played a huge role in shaping the culture of the Korean people – and it is these cultural traits that have put them in a strong position to battle this pandemic.

First, the Koreans are extremely tech savvy and lead globally both on broadband penetration and also in internet speed; approximately 99.2% of Korean households have access to internet and an internet speed that is four times faster than the world average.  There is therefore no doubt that the first t, technology has played a key role in combating this virus. Due to the high number of Korean’s with smart phones, technology has enabled the facilitation of clear and consistent communication from the government to its citizens. Koreans were also quick to innovate with technology. For example, a mapping solution was created in response to the shortage of masks to show which pharmacies have masks in stock, and which didn’t’. (If only we had one for toilet paper.)

Large-scale monitoring of international visitors through Incheon airport is made possible via an app that all visitors are required to download – this app prompts users to respond to a series of questions and report if they have developed any medical symptoms. A solution like this for our cruise passengers returning on our shores could have saved lives. Citizens that live or work near a reported outbreak are also notified via their phones, with incredible detail such as whether the latest COVID-19 victim was wearing a mask or not and these notifications are updated on an hourly basis.

Further, with Koreans having a pre-existing heavily reliance on their phones and e-commerce platforms that offer almost everything from food delivery to laundry services, coupled with a dense population marked by high-rise apartment living allowing for delivering within just a few hours, it gives Koreans fewer reasons to have to travel and venture out of the home.

The second t is for testing. Korea’s widespread testing has gained global recognition, with Korean test kits now being requested by several leaders from other countries including our own. So why has Korea been able to develop these tests on a scale like no other country? Two key reasons – both are historic.

The first relates to Korea’s experience with MERS in 2015 – Korea reported the highest number of cases of MERS outside of the Middle East, with 186 cases and killing 38. One of the key lessons learned from this outbreak was the importance of diagnostic testing, and this lesson was quickly applied once the first outbreak was recorded in China – with government and biotech firms working hand in hand to produce diagnostic testing kits.

The second relates to Korea’s ‘balli balli’ culture, which dates a bit further back in Korea’s history – the Park Chung Hee era (1965-79). Following Japanese rule of Korea and the devastation of the Korean war, where Korean’s spirit and can-do attitude was quashed, Park Chung Hee led Korea to economic success – and did so with a sense of urgency, to catch up for lost time. With no resources, Koreans relied heavily on imitating Japanese and other technologies but beating its competitors in terms of time. This sense of ‘balli balli’ or quickly quickly, over time resulted in Koreans developing comparable technology but delivering it in much shorter timeframes and at a much cheaper cost – this was key to Korea’s economic miracle.

Further, Korea’s economic structure and the dominance of the chaebol (Samsung, LG, Hyundai etc), despite its many limitations in ordinary times, is a positive in a time of crisis. With full control over is vertically integrated manufacturing supply chains, Korean chaebols are able to respond quickly to demands, giving them a clear advantage over its competitors who rely on global supply chains.

There are many other factors of Park Chung Hee’s dictatorship that are pertinent in Korea’s culture today, including the third t – tracing. In Korea, in a time of crisis, officials have Big Brother type powers – access to security camera footage, credit card records and GPS data from cars and mobile phones – and this access has been instrumental in the tracking of citizens movements in a bid to curtail the spread of the virus. Koreans, with a very strong sense of nationalism and patriotism, are generally in favour of self-sacrifice for the benefit of the greater good.

This includes the sacrificing of privacy. During the Asian financial crisis in 1998, we saw a similar sacrificial act whereby many Koreans donated their gold jewellery to help repay its debt to the International Monetary Fund.  It is hard to imagine such self-sacrificing measures would garner a high uptake in countries like Australia or the US – we have enough trouble staying off Bondi on a day over 23 degrees.

Underpinning the three t’s is innovation; Korea has been quick to innovate its way out of this crisis. While Australia has been able to lean on our natural resources for our economic success, Korea’s government, with close to no natural resources has placed heavy emphasis on a knowledge-based economy – investing heavily in education, science and technology. Not only has this resulted in Korea obtaining the highest literacy rate in the OECD, but Koreans have been adept enough to translate this knowledge to success in business on a global scale.

According to the Global Innovation 1000 study which ranks the largest R&D spending among publicly listed companies worldwide, Korea has four companies in the top 100 (Samsung Electronics – 4^th, LG Electronics – 49^th, Hyundai Motor Company – 69^th and SK Hynix – 73^rd) and 33 companies listed in the top 1,000. By comparison, Australia has no companies in the top 100 and only four (Telstra, CSL, Aristocrat Leisure and Cochlear Limited) in the top 1,000.

Beyond the three t’s there are other factors that led to Korea’s ability to take control of the pandemic. The centralisation of the government allows the government’s messaging to be clear, consistent and transparent. Unlike Australia where States and Territories have different rules in place creating confusion. Why can you play golf in South Australia and Canberra but not in Victoria for example?

A lot remains uncertain and the no one knows what the future will hold. Every country has tackled this pandemic differently and despite it being difficult to draw a line of direct comparison, it is clear that Korea’s preparedness, Confucian underpinnings and hierarchical structures have allowed it to emerge as a leader in fighting this pandemic.

 Liz Griffin Executive Director of Australia Korea Business Council

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