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Critical roles of creative economy and innovation in South Korea

Staff writer ▼ | January 6, 2016
In recent years, South Korea’s economy has slowed and the country stands to lose a significant part of its working force due to a rapidly aging population.
Forum South Korea
Forum   Innovation and creativity will be essential
China, South Korea’s biggest trading partner and a far larger economy, also faces its slowest economic growth in decades.

Innovation and creativity will be essential for Korea and China to overcome such challenges. A forum recently held in Seoul, Korea, focused on the actions businesses and governments can take to achieve it.

Organized by the World Bank Group’s Leadership, Learning, and Innovation (LLI) unit, the KDI School of Public Policy and Management, and the Chinese Academy of Governance (CAG), the forum featured internationally acclaimed professionals in the field who discussed the evolution and growing significance of the creative sector in both countries.

More importantly, it demonstrated that the 21st century increasingly depends on knowledge generation through innovation.

In many countries, the creative economy is defined by a convergence of science and technology with industry as well as the fusion of culture with industry. Dong Soo Kang from KDI noted that in Korea, the creative economy agenda is related to macroeconomic phenomena since the decline in GDP is inevitable due to a shrinking labor force.

There are, however, good examples of Korean innovation at work. Korea’s gaming industry is a fast growing creative activity catering to demands from urban consumers.

Supported by innovation in hardware, software, services and industry policies, it recorded export earnings of $3.2 billion in 2014.

The industry, the world’s fourth-largest in revenues, employs a total of 87,000 workers across production, distribution and in arcade rooms.

As much as the creative economy has been at the center of Korea's transition to an advanced innovation-driven economy, China’s industrial sector has been pushing for innovation in recent years.

As it transitions to a knowledge-based economy, China has intensified its pursuit of technological breakthroughs, increasing spending on R&D from 1.39% in 2006 to roughly 2.10% in 2013.