After the 1997 crisis, South Korea implemented the same industrial policy as before, promoting R&D as a major means. Yet moving labor from traditional to modern service industries came to mainly comprise the structural transformation. Some chaebol firms became true global players, but chaebol system has become less relevant for structural transformation while their corporate governance remains poor. Foreign ownership has not helped to improve it because of its own problems. The government promoted venture business aggressively, which was not so successful initially; however, venture business has become ever more important over the years. The inducement of foreign direct investment followed a similar pattern, but South Korea’s direct investment overseas came to outweigh foreign direct investment. The labor productivity and financial soundness of small and medium-sized enterprises fell in relation to large enterprises while they came to account for a higher share of employment, deepening the labor market dualism.

Chapter Eight focuses on the carbon offset scheme in China, with a particular emphasis on forestry carbon sequestration, which is a critical element of the nature-based solution to meet carbon neutrality requirements. This chapter examines the substantive and procedural requirements that support the functionality of the domestic carbon offset scheme. However, the existing regulatory framework for the offset scheme does not fully support the proliferation of forestry offset projects. The chapter identifies the challenges that affect the development of forestry carbon sequestration projects. To address these challenges, improvements are needed in the parameters of the methodologies and admission standards for new projects. Additionally, the legal ambiguity concerning the ownership of forestry carbon sinks needs clarification.

South Korea implemented vertical as well as horizontal industrial policies in the 1960s and 1970s. Though they performed better than in other developing countries, the cost of the vertical policy outweighed its benefit. Industrial policies went side by side with the emergence of chaebol in a full-fledged form. Chaebol led the structural transformation of the economy, but they also led the production of non-performing loans, helping to deepen the 1979 crisis. In the 1980s, the government lifted vertical policy but strengthened horizontal policy while restructuring chaebol. In the 1990s, South Korea jumped into the newly-emerging information and communication technology industries with industrial policy. Meanwhile, the government began to promote small and medium-sized enterprises and introduced fair trade policies in the 1980s. By the mid-1990s, chaebol emerged as global players in higher-technology industries; however, they had many problems, the financial market problem being the most serious, ready to precipitate a crisis.

The South Korean economy began to grow rapidly in the 1960s, enabling it to converge with the advanced countries in per capita product. It did so as the leadership change enhanced state capacity. The government intervened pervasively in the economy, making sure that firms receiving the favors used them properly. The size of the government itself was small, but the macroeconomic policy was inflationary. The resultant inflation affected the way financial policy, the most important policy at the time, worked. The export promotion policy degenerated as the government employed non-price measures while the price incentives fell in spite of the 1964 exchange rate reform because of inflation, whereas the reform helped to check import growth. Nonetheless, exports grew rapidly, providing important dynamism for the economy. South Korea coped with the emerging balance of payments problem by normalizing its diplomatic relationship with Japan and sending troops to Vietnam.

Chapter One discusses China’s carbon neutrality objective and the essential strategies to achieve this long-term climate goal. The strategies focus on decarbonising China’s power sector, enabling fuel switch from coal to natural gas, electrifying end-use such as transport and industry, and adopting carbon removal mechanisms. Implementing these strategies will depend on China’s energy legal and regulatory systems. This chapter introduces the research context and structure of the book, highlighting its contribution to academia and practice. The chapters of the book are arranged based on the four essential strategies and pathways to achieve China’s carbon neutrality target, providing legal details concerning the development of China’s energy legal and regulatory systems.

Economic growth slowed down as the reforms after the crisis introduced a less aggressive system. Banks lent money to households rather than firms as household loans were liberalized. The current account turned into a surplus, but it failed to produce the equivalent increase in net foreign assets because of the large net capital losses. The country now held more international reserves, but it was for self-insurance purposes after throwing open the capital market. The country failed to avoid a currency crisis in 2008, which was resolved through currency swap agreements. The growth rate fell further with the ensuing Great Recession, and the country faced a deflation threat in 2013, but it was slow to use fiscal policy to cope with it. South Korea fought the pandemic in 2020 well but is currently having difficulties with its disinflation policy as it has to heed the risks in international as well as domestic financial markets.

South Korea has become the only country to make the transition from a developing to a developed country after the Second World War; however, its development process has been a tortuous one. This book first explains how Korea failed earlier in history to become a colony and how its economy changed during the colonial period. The book then describes the provision of the conditions for future growth in 1945–1960 and explains the launching of the high economic growth in the 1960s. The book next discusses the development process after the high economic growth began until the 1997 crisis, examining the three conditions for sustaining growth: macroeconomic management, structural transformation, and social conflict management. After discussing the 1997 crisis and the ensuing reform, the book explains how economic development proceeded subsequently until today, again by examining those three conditions for sustaining growth. Finally, it briefly discusses questions for the future.

Chapter Six introduces the overarching law provisions in the Energy Conservation Law related to low-carbon development targets, energy efficiency regulation, energy storage, and financial support prescribed to incentivise these mechanisms. Energy efficiency and energy storage are critical measures that can help China achieve the carbon neutrality objective in a cost-effective and sustainable manner. By improving the energy efficiency of industrial sectors, buildings, and transportation, China can reduce the amount of energy needed to achieve its economic and climate goals, which benefits energy security and emission reductions. This chapter examines the essential regulatory measures adopted by the Energy Conservation Law and critically analyses the regulatory development concerning energy efficiency and energy storage in China.

The period from 1945 to 1960 was a mixture of the darker aspects of the time and the brighter aspects of the succeeding period. While there were disorder, division, and war, many of the conditions for the subsequent development were provided during this period. South Korea became an exception among the ex-colonies by escaping from socialism and being closely integrated with advanced capitalist countries. The country built a system whereby private enterprises faced workers with poor labor rights while carrying out the land reform. After the war, the growth rate was not impressive, as the prevalent government failure made it impossible to overcome the market failure. Yet import-substituting industrialization proceeded, through which chaebol emerged as a major player in the economy. The country implemented disinflation, enhanced education level, and began to promote exports, providing a condition for future growth, but the former two rather helped precipitate a crisis in 1960.

The high economic growth created jobs to reduce inequality as well as poverty. However, in the 1960s and 1970s, the effect was more than offset by other factors, like the widening wage gap between skilled and unskilled workers. There was also a large amount of transfer to the rich through the real estate market, while fiscal policy transferred little to the poor. Industrial relations were repressive. In the 1980s, inequality slowed to widen as the offsetting factors weakened and the transfer through the real estate market decreased, but industrial relations became more repressive. South Korea sustained high economic growth through the democratization process because, while staving off a possible disaster, democratization was limited in scope. Democratization failed to narrow inequality as it interacted with other forces, but it led to reforms to enhance the transparency of the economy. Independent unions emerged with democratization, but it aggravated the non-performing loans problem.