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Business News Thu, 15 Jun 2006

Ghana can leapfrog her economic growth like Korea - Prof Kim

Accra, June 15, GNA - Ghana could leapfrog her economic growth and development strides like the Republic of Korea if the necessary conditions for export and investment led growth strategies were put in place, a Korean Economics Professor observed on Thursday.

Prof. Kim Euysung, Director of Centre for International Studies (CIS), Korea, said building a highly skilled labour force, an environment that would promote effective investment coordination and building of credibility in government policies were crucial for Ghana's economic transformation.

Speaking at a day's seminar in Accra on Korea's Economic Development Experience, Professor Kim said there existed a lot of similarities between Ghana and Korea in terms of growth agendas, investment drives and good political climate which had brought his country this far.

Trade is one of the fastest growing areas in relations between Ghana and Korea. The value of trade between the two countries grew by 77 per cent between January 1998 and November 2005. However, the balance of trade is skewed in favour of Korea. Elaborating on the drastic transformation of Korea's economy, Prof. Kim identified productivity growth; investment growth and capital accumulation and availability of skilled labour force as the main sources of that transformation.

He said based on these pillars, the country with a per capita income of 80 dollars in 1960, registered 100 dollars in a year later and in 1964 recorded 200 dollars. In 2005, the per capita income was 16,291 dollars.

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On investment, he said Korea was able to pull itself out of poverty by investing but added that the Korean Government initiated almost all the industries that sprang up in the early days.

He said, however, that the level of governmental intervention in investment-led growth strategy might differ from country to country depending on socio-economic and political factors.

Prof. Kim said the success of Korea's export-led growth programme was premised on the fact that exports by themselves did not lead to growth but only when they affected economic growth within the economy. Mr Lee Sang-Pal, the Korean Ambassador to Ghana, said for four decades his country lagged behind most developing countries in terms of development.

He said due to lack of natural resources and technology, Korea remained a poor agrarian country but "with the help and support of its people, the Korean Government had pursued a growth-oriented, export-led economic development strategy since the 1960's.

"As a result the Korean economy has recorded remarkable growth, with an annual growth rate of about seven per cent since 1961. "In just half a century, it rose from the ashes of war to become the 11th largest economy in the world. Per capita income jumped 199 times from a meagre 80 dollars in 1960 to 16,291 dollars in 2005." On ICT, he said the country ranked first in high speed Internet with 78 per cent of its citizens using broadband networks. Mr Kwadwo Baah-Wiredu, Finance and Economic Planning Minister, said the seminar, which was at the heels of the last April Ministerial Conference on Korea-Africa Economic Cooperation in Seoul, was to deepen the relations between the two nations.

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He said Ghana was one of four African countries chosen by the Government of Korea to benefit from the seminar. The other countries were Egypt, Senegal and South Africa.

Mr Baah-Wiredu urged the Korean Government consider expanding its import from Ghana so as to make the bilateral relations between the two countries a win-win situation.

He also urged Ghanaian producers to endeavour to produce goods that were of interest to Korea and to sustain the supply of such goods. Mr Baah-Wiredu told prospective Korean investors and companies that the Ghana Government would do everything possible to clear all legal and administrative hurdles.

He proposed to the Korean Government to expose Ghanaian students to information technology, business processing outsourcing and science and technology.

Source: GNA