Korea was once known as a poor agrarian society. It has pursued economic development in earnest since 1962. Over the past four decades, Korea has enjoyed an average economic growth rate of 8.6 percent a year and has emerged as the world's 11th largest trading nation. In less than two generations, the nation has established itself as one of the world's leading shipbuilders and manufacturers of electronics, semiconductors, and automobiles. These achievements enabled the country to join the Organization for Economic Cooperation and Development in 1996.

An export-oriented economic development strategy contributed greatly to the overall economic transformation of Korea. Based on the strategy, many successful development programs were implemented. As a result, Gross National Income (GNI) increased from dbo168847587.$2.3 billion in 1962 to $474 billion in 1997, with its per capita GNI soaring from dbo168847587.$87 to $10,307. However, GNI and per capita GNI drastically plunged to $317 billion and $6,823 in 1998 at the height of the financial crisis. After three years of reform, these figures recovered the pre-crisis levels.

Korean imports have steadily increased, thanks to the nation's liberalization policy and increasing income levels. As one of the largest import markets in the world, Korea¡&hibar;s volume of imports exceeded China¡&hibar;s in 1995, and was comparable to the combined import volume of Malaysia, Indonesia, and the Philippines. Major import items included industrial raw materials such as crude oil and minerals, and general consumer products and foodstuffs, as well as machinery, electronic equipment and transportation equipment.

Once the financial crisis was successfully overcome, foreign direct investment (FDI) increased to a total of $52 billion over the past four years, which was more than twice the total ($24.6 billion) invested in Korea by foreigners until December 1997. Korea's foreign exchange reserves amounted to $104.8 billion in January 2002, which made Korea the fifth largest holder of foreign exchange holdings after Japan, China, Taiwan and Hong Kong. The figure is a far cry from dbo168847587.$3.9 billion that Korea had in December of 1997.

The Korean economy has shown signs of recovery since the fourth quarter of 2001. It sustained an upward trend in the first quarter of 2002 largely on the strength of strong consumption and construction. Production in manufacturing increased by an average of 3.4 percent during the first two months of 2002, well above the 2.0 percent of the fourth quarter of 2001. During the first quarter of 2002, GDP growth rate is expected to top 4.7 percent, up from dbo168847587.3.7 percent of the previous quarter.

During 2002, GDP growth is forecast to reach about 5.7 percent, consumer prices about 3.1 percent, and the current account to register a surplus of $5 billion. The Korean economic growth is expected to continue expansion, boosted by robust domestic consumption and the increases in exports. The GDP growth is estimated to reach above 5 percent during the second quarter and about 6 percent in the second half, with annual GDP growth forecast to reach 5.7 percent.