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Economic and Environmental Lessons from Korea

As part of a series leading up to COP28, let’s look at the ways individual countries are showing leadership in green growth.

Not long ago, most countries just focused on the bottom line: Gross Domestic Product (GDP). A positive GDP meant a growing economy. But there is a new factor these days. Countries need economic development, but more and more people are demanding not just growth, but green growth. Countries, and their leaders in particular, are looking for ways to grow while having less impact on the environment. But what does green growth mean? And how do you measure it?

>>>READ: Economic and Environmental Lessons from Taiwan

It’s important to consider that for something to be green, it must be sustainable: able to be sustained over a long period of time, and ultimately beneficial. No country can afford to invest in green energy if it leads to a weakened economy or national security. Sustainable green growth must thread the needle of improving a country’s economic, environmental, and national security. One without the others is not sustainable. 

Many countries are succeeding at threading that needle. The solutions will look different from country to country, region to region, and continent to continent. Still, the best way to encourage green growth is by allowing people to live and work in economic freedom. 

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A country’s commitment to economic freedom results in more wealth and human progress, which increases the available resources and technologies to invest in environmental protection. Free economies are clean economies where people and the planet alike can flourish. This is true at the macro level, as our Free Economies Are Clean Economies report shows in great detail. At the micro level, however, economic freedom manifests in different ways. 

Consider the Korean Peninsula, divided since World War II into a democratic South Korea and an autocratic North Korea. This makes for a perfect experiment. Both countries share the same ethnic background. The climate is the same. What is different is the type of government. South Korea earned a score of 73.7 in the most recent Heritage Foundation Index of Economic Freedom, making it the 15th most free economy measured. North Korea, on the other hand, was almost too low to measure. It is a “repressed” economy, ranked last out of all countries in the Asia-Pacific region.

South Korea is using its dynamic economy to become a leader in clean energy equipment. “According to the World Energy Outlook 2022 released by the International Energy Agency [South] Korea is evaluated as a major player in the global solar industry value chain in terms of technology and production capacity (cell and module manufacturing),” writes InvestKorea.org. 

South Korean companies are opening manufacturing plants overseas to produce solar panels and batteries, two technologies that will be crucial to an effective energy transition. North Korea, meanwhile, exports virtually nothing. “Exports were down from US$2.8 billion in 2015 to only US$1.7 billion in 2017 and even further to just $192 million in 2022,” writes journalist Katharina Buchholz. Its command economy isn’t able to respond to what people want and need, so the country has virtually nothing to export.

In the south, The Korean government is substantially increasing its share of renewable energy sources in the electricity supply and gradually phasing out coal from its energy mix. It is also committed to significantly improving energy efficiency, and fostering the country’s nascent hydrogen industry. “Many of these measures will help Korea advance its energy transition and improve its energy security, a high priority given the country’s limited domestic energy production,” the International Energy Agency writes.

Meanwhile, North Korea can’t supply any type of energy for its economy. While virtually everyone in South Korea has access to reliable electricity, fewer than 60 percent of North Koreans do. Virtually everyone in South Korea has access to clean cooking fuels. Fewer than 20 percent of North Koreans do. And while South Korea is working to deploy clean energy sources, there is no available data about where North Korea gets its meager supplies of energy.

“South Korea is moving toward a cleaner future with renewable energy making up almost 34 percent of the total energy capacity by 2030, a significant increase compared to today’s 15 percent,” the U.S. government observes. “Solar and wind will drive most renewable capacity additions with offshore wind playing a major role, accounting for nearly 40% of South Korea’s wind energy production in the plan.” 

Sensibly, the country is relying on a varied mix of energy sources. “The role of natural gas and its integration with renewables development in long-term planning is expected to be critical in achieving a carbon neutral target by 2050 and a reduction of 40% in carbon emissions by 2030 from 2018 levels,” as the Asia Natural Gas & Energy Association explains. The South has 25 nuclear reactors in operation, and generates almost one-third of its electricity with them. It is trading that technological expertise. “South Korea is among the world’s most prominent nuclear energy countries, and exports its technology widely,” the World Nuclear Association writes. “It is currently involved in the building of the UAE’s first nuclear power plant, under a $20 billion contract.” There is no word on where power comes from in autocratic North Korea, but the country undoubtedly lacks any sort of energy mix.

As mentioned earlier, The South Korean government has a plan to be carbon neutral, but that plan is subject to change because South Korea’s government reacts to market signals and works to deliver what people want and need. For example, a previous government had planned to phase out nuclear power, but the current government is backing nuclear. 

>>>READ: Economic and Environmental Lessons from Trinidad and Tobago

All told, economic freedom pays off in the South, while the communist North is going nowhere. The way to unlock the power of society and the private sector is by giving people the freedom to innovate. Strict federal mandates, on the other hand, are a path to failure.

COP 28 begins November 30 in the United Arab Emirates. Because of objections from mainland China, Taiwan is not allowed to participate. That is unfair and reflects poorly on the countries that allow Beijing to call the shots. Taiwan is a free economy and a democracy that empowers its people and improves its environment. Nevertheless, Taiwan is sending local officials and observers to the conference to discuss its important mission. At least 11 such groups are already approved to attend.

As we have in recent years C3 Solutions will also be there to host events that promote the importance of economic freedom. Ours is a message of hope that balances the reality of the need for green growth that is truly sustainable. For the sake of people and the planet, let’s hope that leaders listen.

The views and opinions expressed are those of the author’s and do not necessarily reflect the official policy or position of C3.

Copyright © 2020 Conservative Coalition for Climate Solutions

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