The case to this move was provided by the Korean-born economist Ha-Joon Chang in a Guardian article earlier this week:
In my lifetime Korea has lived through one of the greatest development miracles – half a century ago, its annual per capita income was around £50, less than half that of Ghana at the time. Today, it stands at £12,000, putting it on a par with Portugal and Slovenia. How was this possible?
Korea of course did things that most people agree are important for economic development, such as investment in infrastructure, health and education. But on top of that, it also practised many policies that are now supposed to be bad for economic development: extensive use of selective industrial policy, combining protectionism with export subsidies; tough regulations on foreign direct investment; active, if not particularly extensive, use of state-owned enterprises; lax protection of patents and other intellectual property rights; heavy regulation of both domestic and international finance.You read more from Ha-Joon Chang, who teaches at Cambridge, on his own website.
He is also quoted in a recent Christian Science Monitor article:
The government’s emphasis on free trade over aid in its G20 development agenda, however, has left some wondering whether Seoul has wandered from its own development model.I suppose it is rather like the way you become in favour of strict discipline in the classroom as your own schooldays recede in your memory.
Korea received millions of dollars in aid from the United Nations Development Program and other international donors throughout its development process. Last year, Korea became the first major recipient of overseas development aid to become a major international aid donor.
Korea’s economy also benefited from relatively closed markets during the cold war. Professor Chang calls Seoul’s call for freer markets “fundamentally at odds with how Korea itself developed."