Asia's Latest Miracle

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Photograph by Jean Chung for TIME

Seoul-ful The capital's glittering cityscape reflects a very happening place

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Typical of the new breed is Kim Jin Cheon. For eight years, the engineering Ph.D. had a dream job carrying out semiconductor research at Samsung Electronics. But in 2008, Kim, then 36 years old, did what would have been unthinkable in the 1990s: he ditched Samsung and invested $45,000 of his savings in a software firm he named Company 100, to design browsers for mobile phones. Kim says he was inspired by other young entrepreneurs who founded world-beating companies in Seoul, like gaming outfit NCsoft. With more money available to support start-ups, Kim got a $900,000 infusion from a local venture-capital firm in 2009. He says Korea's new spirit of entrepreneurship represents something larger — a longing for more freedom among Korea's youth. "Samsung became a global company, but what did I contribute?" Kim says. "I felt like just one part, not a leader. The younger generation want to do what they really love."

Cry Freedom
The reason why Kim chose to follow his dream is intimately linked to Korea's political changes. The country was largely ruled by dictators for 26 years, until massive street protests forced free elections in 1987, and even after that, the government still intervened heavily in the economy. But Korea has become a much more democratic society over the past decade, driven by Presidents Kim Dae Jung and Roh Moo Hyun, the first leaders to come from an opposition party, and the market-oriented economic reform made necessary by the 1997 financial crisis. That, says Kim Se Joong, founder of software start-up JellyBus, has emboldened Koreans to take more risks — a crucial ingredient to creating an innovative economy. "When the government was big and had a strict system of control, it was difficult to succeed without the support of the state, so parents pushed their children to reach for stability, by working in Samsung," says Kim. "Now the government is smaller and intervenes less. People feel they can become successful, whatever company they work for. The economy of a country is very reflective of the politics of the country."

Kim Sang Hun takes this thinking one step further. The CEO of NHN, owner of Korea's most popular Internet search engine, Naver.com, says the emergence of new innovative industries like his would have been impossible without Korea's democratization. He remembers the harsh times under the dictators, when police were frequent visitors to college campuses and Koreans were restricted from traveling abroad. "Now the younger generations have become more individualistic and free; they go to Europe on backpacking trips," Kim says. "I think openness is necessary [to have creative industries]. People are not scared to say their thoughts."

Freedom has been an important factor in the career of hip-hop star Tiger JK, who performs as the one-man act Drunken Tiger. The story he told me shows the link between Korea's new openness and its ability to innovate. Back in the 1990s, Korean popular music, or K-pop, was popular only in Korea. Its highly stylized, color-by-numbers dance acts were tightly controlled by the industry, and created all the excitement of a sing-along with Barney. Tiger JK had no interest in playing along. After spending his teenage years in Los Angeles, he returned to Seoul in 1995, hoping to break into the hip-hop scene. But his chatty raps and freewheeling shows were too unusual for Korean music executives. Producers of TV shows promoting new music scolded him for diving into the audience during performances. He even got booed.

Tiger JK peddled recordings of his raps at alternative clubs and built up a following at college campuses with his rebellious shows. About five years ago, other, more famous K-pop stars started seeking him out to praise his music — then adopted some of its elements, like shout-outs to the crowd. TV producers began asking him to dive into the audience. "They were waiting for me to do something wild," he says. Last year, Drunken Tiger won some of the country's most prestigious music awards. Tiger JK says it's because he's become "safe." Actually, it's because Korean society has become as audacious as him. K-pop today is considered the cutting-edge force in Asian popular music. Exports of K-pop nearly doubled in 2009 to over $31 million. "Korean artists became the freedom warriors" for young Asians everywhere, says Tiger JK.

Above all, Korea offers a counterpoint to those political leaders — like China's — who believe "state capitalism" is superior to free enterprise, or that they can create an innovative economy without civil liberties. Of course, that doesn't mean the Korean system is perfect. Despite its progress, Korean society still remains too wary of foreign influence and too biased against women in the workforce. Businessmen complain that too much red tape clogs their way. The outdated education system is so rigid that parents flee the country in droves to put their kids into high schools in the U.S. and elsewhere. The Korean economy is still not a fair place where everyone is governed by the same rules. And North Korea hovers as a relentless threat.

However, the Korea I know is a country that confronts its challenges. I asked my old friend at LG, Sue Kim, what Korea will be like in another 10 years. With more and more Koreans gaining international experience, she believes the great globalization of Korea will continue. South Korea has 75,000 students enrolled at U.S. universities — third highest, behind giants India and China, according to the Institute of International Education. "I think you'll find a much more cosmopolitan Korea," she says. "I think Koreans will bring in more diverse ideas and backgrounds. We're going to extend our presence more globally. We're going to continually grow, and you're going to see a much better country in 10 years." I don't doubt it.

— with reporting by Lina Yoon / Seoul

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