Back

Country Reports

South Korea Country Report

Content provided by
IHS Markit Logo

Risk Level

Low
Moderate
Elevated
High
Very High
Severe
Extreme

Overview

Executive Summary

President Moon Jae-in remains relatively popular despite minimal action on promises to constrain the "chaebeol" conglomerates' dominance. He has delivered a supplemental budget for job creation, a tax increase for the largest corporations, and a minimum-wage increase, and will probably continue prioritising similar Korean liberal-party policies. Slow progress or unpopular policies are likely to trigger large-scale protests organised by civil groups, or labour unions (which are more likely to fight with security forces). His Democratic Party only holds 118 of 300 seats in the National Assembly, necessitating co-operation with centrists or the conservative opposition. Real GDP will resume a near-normal growth rate of 2.6% for 2018 and 2019, although this will be marginally slower given China-US trade friction. Strong productivity growth and relatively low unemployment favour continued expansion (especially in combination with prior stimulus from the Moon administration), healthy domestic spending reflecting continued confidence in the household and business sectors, and dovish monetary policy from the Bank of Korea. Inflation will see a small uptick during the next few months because of healthy growth, negligible slack in the supply side of the economy, and gradually rising oil prices. The labour market will continue to perform well during the near term, with the unemployment rate relatively steady just under 4%. However, this is expected to trend upwards to OECD levels of about 5% by the mid-2020s. North Korea and South Korea are technically still at war. Moon's continuing popularity in large part is due to diplomacy with North Korea, but in 2019 his administration's efforts are likely to be constrained unless the United States changes its position – this would most probably follow a second summit with US President Donald Trump, but remains unlikely. Rather IHS Markit assesses that the most probable scenario is a return to an exchange of military threats, and open weapons testing by North Korea. © 2018, IHS Markit Inc. All rights reserved. Reproduction in whole or in part without permission is prohibited.
Last update: December 8, 2018

Operational Outlook

South Korea's operational environment is generally benign, with a high standard of transport and communication infrastructure. However, each year, union-led protests attract thousands of participants, disrupting transport in Seoul and other major cities such as Busan. Furthermore, although the government officially welcomes foreign investment, companies will probably encounter resistance at lower levels of administration. Corruption is more of a problem in South Korea than in other OECD countries. Multiple high-profile cases each year involve the "chaebeol" conglomerates that dominate the economy, resulting in then-president Park Geun-hye's impeachment in March 2017.

Last update: October 9, 2018

Terrorism

Moderate

There are no organised militant groups in South Korea. Most radical and occasionally violent elements are probable in student and labour movements acting in pursuit of political and economic objectives. However, security forces closely monitor known groups to mitigate the risks of attack. The substantial US military presence in South Korea makes US assets a potential target for militant attacks. North Korea conducted terrorism-style attacks on South Korea before the turn of the millennium, but the risk of further such attacks is low in the one-year outlook. Nonetheless, cyber attacks, probably perpetrated by North Korea, are growing in incidence, if not severity.

Last update: October 9, 2018

War Risks

North Korea and South Korea are technically still at war. Their stable, if uneasy, truce is punctuated by periods of heightened risk of escalation towards unintended conflict, following North Korean provocations or during US-South Korea joint military exercises. However, full-scale conflict remains unlikely, mainly because of ongoing diplomatic efforts and because neither North Korea nor the United States will probably cross the other's redlines. In the unlikely event of war, North Korea would probably target Incheon and Seoul, among other cities, with artillery and missile fire, resulting in severe loss of life and extensive property damage.

Last update: October 9, 2018

Social Stability

Elevated

Strikes occur regularly each year in South Korea's automotive sector. Occasionally, truckers and railway workers hold sympathy strikes, disrupting cargo transport. Strikes at manufacturing plants can turn violent, with workers occupying facilities and fighting with the police, but the risk of property damage is low. Protests are common in Seoul but are unlikely to involve more violence than isolated fighting with the police. In November 2015, the police used tear gas-laced water cannons to contain unions' violent demonstrations. Issues triggering protests include the government's push for free trade agreements, public companies' debt reduction, and nuclear-energy usage expansion.

Last update: October 9, 2018

Health Risk

Elevated

Vaccinations required to enter the country

No vaccinations are required to enter the country.

Routine Vaccinations

Hepatitis A: A vaccine is available for anyone over one year of age. The vaccine may not be effective for certain people, e.g. those born before 1945 and who lived as a child in a developing country and/or have a past history of jaundice (icterus). These people can instead get a shot of immune globulin (IG) to boost their immunity against the disease.

Hepatitis B: A vaccine is available for children at least two months old.

Diphtheria-Tetanus-Polio: A booster shot should be administered if necessary (once every ten years).

Other Vaccinations

Typhoid Fever: If your travels take you to regions with poor sanitary conditions (for children two years old and up).

Japanese Encephalitis: For stays of longer than one month in a rural zone during the rainy season (for children over the age of one). The vaccine is administered in a local medical facility.

Malaria Recommended preventive medication for travel to the Demilitarized Zone (DMZ) or to rural areas in the north of the country (Gyeonggi and Gangwon provinces) - chloroquine (sometimes marketed as Nivaquine).

For Children: All standard childhood immunizations should be up-to-date. In the case of a long stay, the BCG vaccine is recommended for children over one month and the MMR (measles-mumps-rubella) vaccine for children over nine months.

Last update: November 27, 2013

Natural Risks

Severe

Monsoon season (July-September) brings regular flooding and typhoons; the southern regions are particularly vulnerable. Typhoon Maemi killed 100 people in September 2003. Typhoon Kompasu, the strongest storm to hit the region in 15 years, struck South Korea in early September 2010, leaving three dead and significant material damage in its wake. In October 2016, Typhoon Chaba struck the cities of Busan and Ulsan, resulting in dozens of casualties.

In the event of flooding, travelers are advised to refrain from driving in affected regions, to avoid underground areas (basements, subways), and visiting flood-prone and coastal zones (either on foot or by car).

It should also be noted that air pollution levels usually reach their peak in July and August.

Last update: February 13, 2018

Practical Information

Climate

Spring and fall are sunny and dry. Summer, monsoon season, is hot (30°C to 35°C) and very rainy. Winter, which begins in late November and lasts until early March, can be harsh (with temperatures falling to -10°C).

Useful Numbers

Country Code: +82
Police: 112
Fire Dept.: 119
Ambulance: 119

Electricity

Voltage: 220 V ~ 60 Hz

Outlets:

Last update: January 27, 2014