Korea TimesKnowledge-Based Society e-Korea Project Launched
With more than 30 percent of population online, Korea is fast becoming one of the most Internet-savvy countries in the world. More than 60 percent of people are engaged in online stock trading and broadband Internet infrastructure is also rapidly deployed across the country.
In addition, Korea is the first country in Asia for mobile phone subscribers to outnumber fixed-line customers. The recent award of third-generation (3G) telecommunication licenses will also accelerate the roll-out of wireless application protocol (WAP) and all this will create an extraordinary business opportunities for the nation's wealth.
In line with this astonishing growth rate in information and technology (IT) sector, the Ministry of Information and Communication proposed this year's major policy that it would establish the knowledge-based e-Korea, in an annual briefing to President Kim Dae-jung, last week.
Minister Ahn Byong-yub outlined four core projects, saying that the ministry will redouble its efforts to reinforce the social foundation fitting for a knowledge-based society.
``In the promising 21st Century, knowledge-based society will surface to substitute the existing old industrial society,'' said Minister Ahn. ``The knowledge-based society is a society where all social systems including life styles and business methods of all economic subjects such as government, companies and individuals are reorganized through all-all embracing application of IT-related technologies.''
Through a five-year investment plan, the government will expand the high- speed Internet network on a gradual basis. By the end of this year, nearly six million households will connect into broadband Internet such as asymmetric digital subscribers line (ADSL), fiber optic cable and satellite Internet.
The ``Framework Plan on Informatization Promotion'' consists of six sections and focuses on setting a framework, which is essential to promote informatization undertaken by the government selection and promotion of major informatization goals with the focus on the public sectors; early construction of information superhighway; formation of the basis for information and telecommunication industry; legal and institutional arrangement; information protection; and information standardization.
In addition, the government established the ``Cyber Korea 21'' project that supplemented and developed the existing informatization promotion plans with regards to the changed informatization situations under the guidance of Informatization Promotion Committee.
``Cyber Korea 21'' will present the vision and practice of the national informatization policy.
The first one is a step to improve the quality of people's lives, which includes provision of 158,000 PC units to elementary and middle schools, construction of local area network (LAN) for 2,500 high schools, and training of 85,000 teachers on informatization.
The second is to secure the competitiveness in the overall industries, supporting for the construction of e-commerce systems in steel, shipbuilding and other industries so the they can strengthen their competitiveness via the Internet. Finally, the ministry has planned to set pilot business for electronic document distribution to activate electronic document distribution among administrative organizations in order to enhance the productivity of the government as well as to keep expanding electronic procurement system.
Providing high-speed Internet facilities for 475 counties across the nation, the project will be expanded its scope of application to smaller-sized communities in the rural areas or remote regions.
Minister Ahn also said the ministry would find ways to fill the manpower shortage in the information and technology (IT) sector. A shortage of about 210,000 highly trained personnel is expected by the end of the year 2004. According to the ministry, the IT will post $58 billion in exports and a trade surplus of $16 billion this year.
In addition, the ministry will complete the establishment of an information network connecting Asia and Europe, which was propose by President Kim Dae-jung's official visit in three European nations last year. Under the planned timetable, the government will form a ``Trans-Eurasia Network'' by linking the two continents with high-speed telecommunications networks by the end of 2003.
With the robust growth of the IT industry in the recent years, naturally, the demand for talents in this sector has been unprecedented. The demand for IT experts is forecasted to reach
1.5 million by the year 2005 recording an increase from 1.07 million as of the end of 1999. Financial support will be allocated to IT-related graduate schools and private institutes so that they may be equipped with the state-of-the-art computer facilities in the course of training students.
To cope with the increasing Internet fraud and virus attacks, the ministry plans to train 4,000 information security personnel annually. Moreover, Information security research institute will be set at universities by the end of this year.
In a similar move, the government will introduce an electronic certificate system for information security agencies that analyze and resolve vulnerabilities of specific networks.
Meanwhile, to promote inter-Korean exchange and cooperation, the ministry will implement the remote meeting of separated families via videoconferencing system, the deployment of telecommunication infrastructure in North Korea's Kaesung region and standardization of inter-Korean computer software and hardware.
Recently, Institute for International Economics (IIE) senior fellow Marcus Noland said the advent of IT industry is changing the structure of the nation's economy, signaling a positive sign in the national development.
``According to a survey jointly conducted by the London Business School and Babson College, 9 percent of adults in Korea were owning or managing new firms, by far the highest in the world. (The United States was second at less than 5 percent.)'' he said.
Most of these new firms spend more than 20 percent of their revenues on research and development, and innovative Korean information technology firms such as Commerce21 Corp., Serome Technology Inc., and Internet Auction Co. (acquired by eBay in January 2001) are cracking the Japanese market, proving that Korean information technology firms are leaders, not followers, in the IT revolution.
``These new firms are changing South Korean corporate culture as well,'' he siad. ``For example, in contrast to the secrecy that has characterized the chaebol,the management of Humax, a maker of digital set-up boxes for satellite broadcasting, holds regular meetings with institutional investors.''
In contrast to the strict seniority-based formulas, which characterize chaebol renumeration practices, firms such as Locus, a supplier of communications and internet services, have introduced incentive-based pay and stock option schemes.
Paradoxically, he said, this strong move into high technology, especially IT, is both a source of long-run strength and short-run vulnerability, the latter due to Korea's deepening integration with the United States through both trade and financial market channels.
Ahn also said that the government, military and the private sector would invest 77.5 billion won through the year 2005 to develop domestic satellites. According to the ministry report, the cyber age will also be brought to postal services with the ministry offering comprehensive services connecting the postal service, post office banking and the Internet.
The Internet population of Korea also exceeded 10 million as the end of 1999 and is expected to reach 20 million this year. As a result, the digital economy represented by electronic commerce and information technology (IT) will take up a greater part in the world economy, and the rapid spread of the Internet users will bring innovative changes in various national operating methods including politics, society, culture and welfare Amid such surge in the use of Internet, one challenge we encounter is the issue of the digital divide, the gap between the information haves and have-nots. The government believes that the economic disparity from the Industrial Age should not be passed on and widened in this information society, and therefore deems important support provided for the less privileged people who often can not reap the benefits information offers.
Another top priority of the ministry's policies this year will be placed on the deadlocked privatization of Korean Telecom. The recent auction to sell 14.7 percent of the company's stake to local investors resulted in the sale of just 1.1 percent. However, the timetable to completely privatize the nation's largest fixed-line provider by June 2002 would not be changed, Minister Ahn said.
For the planned privatization, the government will sell off 49 percent of stake to foreign investors by the first half of this year. After that, the remaining government's share will also be sold for domestic investors by the end of this year.
Seeking to speed up the privatization process, the ministry will issue depository receipts (DRs) from the company by mid-April at the earliest. The ministry and state-run telecoms giant have a plan to closely examine market conditions and are considering to make stake sales through strategic alliance and the issuance of DRs as soon as possible.
Concurrently, the ministry reaffirmed its stance on third-generation (3G) telecommunication service or IMT-2000 bid in mid-March, saying it will select an IMT-2000 operator to use synchronous-mode technology as planned. The ministry will also support the commercialization of cdma2000 1X technology as soon as possible. The technology is considered the 2.5 generation in mobile communications, and the ministry wants it to be used to contribute to the development of third generation cdma-2000 1 Xev technology.
Meanwhile, IT industry contribution to gross domestic products (GDP) increased from 9.7 percent in 1997 to 10.7 percent in 1999, and the exports of the industry reached $3.99 million taking 58 percent of the trade surplus. This year, it will post $45 billion in exports and a trade surplus of $14 billion.
The ministry's objective is to achieve the vision of becoming one of the world top ten IT powerhouse by expanding such results to the whole nation.