[Column] How much credit does Japan really deserve for the Miracle on the Han River?

Posted on : 2023-03-24 17:16 KST Modified on : 2023-03-24 17:16 KST
There is a largely overlooked factor that contributed greatly to Korea’s breakneck economic development
President Yoon Suk-yeol of South Korea (left) shakes hands with Prime Minister Fumio Kishida of Japan ahead of their summit in Tokyo on March 16. (Yonhap)
President Yoon Suk-yeol of South Korea (left) shakes hands with Prime Minister Fumio Kishida of Japan ahead of their summit in Tokyo on March 16. (Yonhap)

“Thanks to President Park Chung-hee’s decision to normalize diplomatic relations between South Korea and Japan in 1965, Samsung, Hyundai, LG, and Posco were able to grow into world-class companies and become the driving force that allowed for the extraordinary development of the Korean economy.”

President Yoon Suk-yeol’s comment came on Tuesday at a Cabinet meeting, where he went on to say that his “solution” to compensate victims of Japanese colonial era forced mobilization through third-party reimbursement would be a “huge benefit to our people and businessmen.”

But is Yoon’s perception that South Korea’s economic development was directly driven by and thanks to the normalization of diplomatic relations with Japan really true?

In reality, the so-called “Miracle on the Han River” that took place during the rule of Park Chung-hee owes much more to Vietnam than to the normalization of ties with Japan. Let’s compare some numbers.

Japan provided South Korea with US$800 million (300 million in grants, 200 million in loans, 300 million in commercial loans) as part of the claims settlement agreement signed between the two countries. It is now a well-known fact that the Pohang Iron and Steel Company, now known as Posco, and the cross-country Gyeongbu Expressway were built with this money.

On the other hand, the sum of US dollars that the Park Chung-hee regime received from the US in exchange for its participation in the Vietnam War amounted to a whopping US$8.14 billion, according to research by Kwak Tae-yang, presented in the paper “Re-evaluating South Korean Participation in the Vietnam War.” This is more than 10 times the amount of money that South Korea received from Japan. In fact, the money the US government directly gave to the South Korean government alone amounted to US$4.62 billion.

This is why experts and scholars point out that the Korean-style development model is difficult to explain without a clear understanding of the Vietnam War.

The Miracle on the Han River was the result of several intertwined factors. Among them are successful agrarian reforms immediately after liberation; a five-year economic development plan and an export-oriented industrialization strategy devised by the Chang Myon government and then adjusted and implemented by the Park Chung-hee regime; the money from the Korea-Japan claims agreement; and the influx of US dollars as a result of South Korea’s participation in the Vietnam War.

Above all, we can’t forget the dedication shown by the generation that sent the foreign currency they earned through hard labor in the Middle East and Germany back to their poor homeland and families.

Nevertheless, many Koreans link the Miracle on the Han River to Park Chung-hee and the settlement funds received from Japan while staying silent about the role played by South Korea’s participation in the Vietnam War.

A reason for this could be due to a few “inconvenient truths” — such as the fact that 5,099 out of the 312,853 South Korean soldiers deployed to Vietnam died there, or the vast number of Vietnamese people who died at the hands of Korean troops.

Regarding the latter, on Feb. 7, the South Korean judiciary issued a ruling acknowledging the South Korean military's massacre of civilians during the Vietnam War and the responsibility of the South Korean government to compensate victims for the damages they suffered as a result. The ruling was the result of long-term efforts by Korean civil society and Vietnamese victims to face this violent history head-on.

The South Korean government, however, appealed the court ruling on March 9, saying it was dissatisfied with the verdict. The Vietnamese Ministry of Foreign Affairs called the move “very regrettable.”

“Vietnam's policy is to put aside the past and look towards the future but this does not mean that we deny the truth of history,” the ministry’s spokesperson said. The words hit deep.

While the 2018 Supreme Court ruling created the way for “right to claim solatium against Japanese corporation, premised upon the Japanese corporation’s unlawful acts against humanity with direct links to the Japanese Government’s unlawful colonial domination of the Korean Peninsula and waging of wars of aggression,” Yoon belittled the verdict as an “obstacle.”

But the future of South Korea will flourish only once we face history head-on by invalidating the third-party reimbursement plan for forced laborers and withdrawing the appeal on Korea’s atrocities in Vietnam.

By Lee Je-hun, senior staff writer

Please direct questions or comments to [english@hani.co.kr]

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