1. National Informatization for Achieving the Knowledge Information Society Performances and Challenges of Each Area

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1 Republic of Korea

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4 Contents 1. National Informatization for Achieving the Knowledge Information Society 4 2. Performances and Challenges of Each Area A. Egovernment 6 B. Mobile Communications Industry 7 C. Cyber Security 7 D. National Informatization Outlook and Issues 8 3. Achieving Digital Creative Korea for National Happiness A. Informatization Promotion Framework 10 B. ICT Strategy Council and CIO Council 11 C. The 5 th National Informatization Master Plan Informatization Level A. Networked Readiness Index 16 B. National Competitiveness Indices Egovernment A. Egovernment Strategy 19 B. Status of Egovernment Implementation Life of Citizens A. Information Usage 22 B. Using Internet Services 27 C. Internet Addiction and Digital Divide 32

5 7. Digital Economy A. IT Usage by Businesses 37 B. IT Utilization Level 40 C. IT Utilization Development Stages ECommerce A. Total ECommerce Volume 45 B. ECommerce Volume By Transaction Type Informatization of Agriculture and Fishing Industries SOC Informatization A. Intelligent Transport System (ITS) 51 B. Policies for National Spatial Information 52 C. Smart Grid Digital Convergence Infrastructure A. Internet Infrastructure 54 B. Future Network ICT Idustry A. ICT Industry Exports and Imports 60 B. Convergence of IT and Other Industries and Commercialization of New Technology Services Information Security A. Internet Incident Trend 66 B. Information Security Technology R&D 68

6 1. National Informatization for Achieving the Knowledge Information Society Korea has worked on national informatization, aimed at achieving the knowledge information society. First, it established key infrastructure in major areas such as administration, finance, education, research, and national defense, and built system foundations such as the legal framework and national informatization promotion fund. The technological infrastructure, added by system environment and economic foundation served as the main drive for efficient informatization of the country. Second, Korea focused on improving productivity by spreading the Internet access to the entire society efforts on building Korea Information Infrastructure, the project for constructing highspeed network in Korea, and fullscale egovernment implementation are some of the examples of contributions to productivity gain. These efforts led to the achievement of the world s toplevel Internet speed and e government, while increasing opportunities for efficient application of ICT in public and private sectors. Third, Korea planned to achieve sustainable growth and national development by facilitating new ICT access by both public and private sectors in the areas of transport, logistics, safety, and environment. In this regard, the humanfriendly ICT world will be realized through intelligent social environment, which will be represented by life care robots, smart home cities, and cuttingedge infrastructure for everyday living. Korea has achieved more than what was expected in spreading the broadband, building necessary infrastructure, and economic development in related industries. 40 million smart phones, the level of economic growth with the ICT share in GDP being 7.1%, and complete broadband penetration are major results that prove Korea s efforts in national informatization. Diverse changes of ICT environment in 2013 made a turning point in Korea s national informatization strategy. The national informatization strategy of today, which is focused on ICT infrastructure, ICT industry, and ICT use, is now about to make a shift toward a strategy focusing on smart infrastructure, smart industry, and smart use with added mobile features. As it is now becoming the new imperative to upgrade the positioning of Korea in terms of national informatization as an ICT powerhouse to that of smart technologies, there is an increasing need for redirecting the paradigm of this era, following the industrialization and informatization, to what we call smartization. The changes in the new environment include innovation based on new technologies such as mobile, big data, and cloud technologies, increased convergence, emergence of the hyperconnectivity environment where all National Informatization White Paper

7 1. National Informatization for Achieving the Knowledge Information Society things connect and interact with each other, and evolution to ICT services that are humanoriented and intelligent. Increasing innovation and convergence based on new technologies is displayed in diversification of platforms and facilitation of software convergence. The share of ICT market involving mobile, cloud, social media, and big data industries is forecasted to dramatically increase from 18% in 2010 to 80% in Mobile platform competition for interconnectivity between mobile devices is continuing, and big data will bring new economic impact in the areas of public administration, retail, manufacturing, marketing, healthcare, and information and communications, as the fourth managerial resource. The hyperconnectivity means an environment where all things and humans are always connected with each other; according to Gartner, the number of population using the Internet will reach 5 billion, and the number of devices connected to the Internet will be more than 100 billion by the year New added values will be generated through convergence of the entire industries that are based on the hyperconnectivity environment, further creating numerous opportunities in the society. Intelligent ICT means the coming of the age of Digital Sixth Sense 1), where smart devices use their sixth sense to deliver what a user wants upon their own decisions, with the help of technological development in the areas of context awareness, sensors, and artificial intelligence. If the initial policy motto, late in industrialization but leading in informatization, is still valid, then Korea s strategy for the smart society must be enabling all to enjoy benefits from leading informatization. In this context, the point when efforts begin for achieving the true smart advanced country within the government, market, and civil society is the year 2013, the inauguration year of the new government. In the meanwhile, activities for national informatization have so far changed constantly, toward finding solutions to political, administrative, economic, social, and cultural issues as well as environmental changes, and facilitating growth. Providing support to projects, which incorporated capacities of the entire government ministries so that ICT could position itself as the infrastructure reaching the entire society, helped such activities grow continuously. At the same time, systematic connection between the National Informatization Master Plan and action plans of each ministry allowed meeting the goal in such a short period of time. However, in 2013, the turning point, we are challenged to develop new strategies that reflect problems raised in the process of meeting goals in the past, along with the issue of stagnated growth. Issues raised in the ICT industry, such as facilitating startups, solving youth unemployment, increasing burden of household communication expenses, and still unstable ICT security environment that seems to be far from being solved, have become the issues that need to be tackled more actively from policy viewpoints. It is time that we need to offer new policy values that are able to facilitate future performance, just as the past decade has achieved. 1) Paul Jacobs, Qualcomm CEO, Keynote Speech in CES

8 2. Performances and Challenges of Each Area A. Egovernment The egovernment services that had been worked on since 2001 achieved the goal of innovating the administration and improving civil services. With the introduction of Web 2.0 in 2005, the principles of ICT service development participation, sharing, and openness had been reflected in the updated government operation framework, Gov 2.0. After that, in 2012, the newly proposed framework, Gov 3.0 came to take the government service values to the next level openness, sharing, communication, and collaboration. In terms of policies, the Electronic Government Act was enacted in 2001, which served as the legal ground for implementing 11 egovernment initiatives as the national project. For five years from 2003, efforts were made, focusing on and improving egovernment projects, and in 2011, the Plan for Smart Government was established as the main policy for solving current social issues and ensuring citizen happiness. In July 2013, the Korean government announced the Gov 3.0 Master Plan, providing a new paradigm for government operation aimed to achieve a citizenoriented, transparent and capable government that communicates with the citizens. Also by redefining the government as one that provides services as platform, information sharing, information disclosure, and collaboration (between ministries and citizens) have emerged as key tasks of Gov 3.0. As for the economic impact, egovernment exports have reached USD million, which is a 44% increase from 2011 (USD million). The egovernment export volume has been rapidly increasing, starting from only USD 100,000 in 2002, to USD 150 million in 2010, to USD 240 million in 2011, finally reaching USD 340 million in This can be evaluated as the result from improved status of Korea s e government in the world, aggressive marketing of ICT businesses toward overseas markets, and efforts from the government to increase exports(refer to Table 1). Egovernment exports in 2012 consist of more diversified items including not only the longterm trusted procurement and customs but also government administrative network, electronic resident card, transport, and disaster management. In addition, the countries and regions these items are exported to is also expanding from mostly Southeast Asia (59.4% in 2011) to Africa (31%), Southwest Asia (28%), Southeast Asia (19%), Latin America (11%), Central Asia (8%), and Middle East (3%) in Table 1 Egovernment Exports (x USD 10,000) Total , , ,732 6,670 14,876 23,566 34, National Informatization White Paper

9 2. Performances and Challenges of Each Area Another characteristic of the egovernment exports is a sharp increase in winning contracts for projects funded by overseas governments or international organizations, which are generally put under keen competition among multinational businesses, and this is due to the improved global competitiveness of ICT businesses in Korea. Some of the exports include the eresident card project in Afghanistan (USD 45 million), government administrative network project of Mali MPNT (USD 35.7 million), ecustoms system project in Tanzania (USD million), and airport system project in Libya (USD 20 million). B. Mobile Communications Industry For mobile communications industry, major policies include increasing use of the mobile network, establishing schemes to strategically secure radio frequency in preparation for the age of mobile broadband, and reducing burden of household communication expenses. First of all, in order to prepare for the rapidly increasing amount of wireless data traffic every year, Ministry of Science, ICT and Future Planning (MSIP) is building 1,000 new public WiFi networks in major public areas in 2013 as part of its efforts to establish 2,000 public WiFi networks altogether, including the existing ones. Such public WiFi networks help achieve user convenience and service quality, as well as use as means for publicizing policies. Following the WiFi network construction, the Korean government plans to establish a subscriberoriented fixed mobile convergence soft network infrastructure that incorporates 4G, 5G, Future Internet, and Internet of Things, by supporting standardization of ultrawideband transmission technologies that offer the speed 40 times faster than the ones in 2012 (25 mbps/user) and finding economical and efficient measures for improvement. As the communication expenses are laying a burden on households, various efforts are being made to guide lowering of the prices through facilitated service competition, abolishment of mobile communication service subscription fees, and user empowerment on the right of choice. C. Cyber Security International cyber terrorism, becoming more intelligent with technological development, is not only bringing massive damage on individuals and businesses but also emerging as a threat to national safety. According to a Semantec survey in 2011, the amount of economic loss throughout the world caused by cyber terrorist attacks was USD 388 billion, and the number of victims, 431 million this means that 14 persons per second, or 1 million persons on a daily average are receiving cyber damage. In order to respond to cyber threats, the Korean government incorporated, in the nextgeneration egovernment plan, efforts to prepare for cyber threats that are becoming ever more intelligent and largescaled, and establish egovernment infrastructure for safe ICT services. 7

10 The number of cyber crimes in Korea was 33,289 in 2001, and it increased by 351% to 116,961 in The number of arrests also increased by 403%, from 22,693 in 2001 to 91,496 in As a result of stronger enforcement by the police, the number of cyber crimes, which had continued to rapidly increase, is showing a slight decrease since For timely response to cyber crimes, cyber crime investigation teams are established in district police agencies throughout the country, and cyber investigation task forces are installed in 234 police offices for responding to the most common types of cyber crimes. In addition, more measures are constantly developed, including introduction of special cyber employment scheme for inviting privatesector IT experts to join investigations, 24/7 telephone consulting on cyber crimes and Internet reportfiling system, and global cooperation for responding to international cyber crimes. For timely and effective enforcement, the police is carrying out concentrated investigations by season, targeting cyber violence, pornography, shopping mall frauds, mobile spam, etc. D. National Informatization Outlook and Issues In terms of technological aspects, the global economy and industry paradigm is led by the ICT ecosystem, in which contents, platforms, networks, and devices (CPND) are closely connected together. The USfocused CPND ecosystem, which had been leading the global ICT economy and industry with coexisting and open platform strategies of Apple and Google, is now being reorganized into a new ecosystem due to the impact of the Chinese market, which is expanding domestic and overseas markets through the government s strong ICT consumption policies. First, ICT changes will be for contributing to improvement of human capacities in physical, emotional, and cognitive areas through development focused on wearable technology. Technologies regarding 3D bio printing, braincomputer interface (BCI), voice translation, and gesture control will be even more facilitated. Second, using technologies like holograms, autonomous vehicles, mobile robots, and remote assistance (virtual assistants), highrisk or repetitive tasks can be processed instantly, leading to potential productivity gain through machine replacing humans. Third, by combining machine s productivity and speed with humans emotional intelligence and problemsolving capability, work efficiency can be maximized based on collaboration between humans and machine. For this, technologies like autonomous vehicles, mobile robots, NLQA(natural language question answering), and remote assistance are used. Fourth, more values can be provided within the context of human emotions and situations enabled by interaction based upon context awareness. Such technologies that are used to improve machine s understanding of humans and environment include affective computing 2), biochips, 3D scanners, locationbased intelligence, voice recognition, etc National Informatization White Paper

11 2. Performances and Challenges of Each Area Fifth, big data, analytics, and cognitive computing will enable decisionmaking support, automation, and machine cognition and intelligence, further raising our expectation for smartization of humans and machine. However, establishing a data business ecosystem desperately requires fostering of data scientists who are aware of the demand for data and the values of using them and who have the capacity to analyze and use data in the field. There are only 100 or more big data specialists in Korea, and it is pointed out that we will need 14,000 specialists by ) In terms of social aspects, the future information society will first need proactive response and solution to social issues in the areas of disasters, welfare, education, etc. Not only risk management against natural disasters but also risk detection, information delivery, and provision of countermeasures when an incident breaks out such as hacking or privacy infringement must be prompt within the network of citizens. Moreover, measures should be sought for by considering digital divide and smart divide in order to minimize the number of people who are disadvantaged from using smart technologies and receiving benefits from them. Second, the need for creating addedvalue by applying national data to the entire society will increase even more. In particular, there will be higher demand in the society for seamless interaction between online and offline activities through facilitated channels for policy engagement, which gather people s collective intelligence, which is prevalent in the smart society. Also, as the government s activeness in information disclosure and sharing is still insufficient, creating standardized government information, information sharing based on open administration, and increased coverage of public information that can be used by the private sector by each security level will become more important policy issues for the future smart society. Major countries like the United States and the United Kingdom are providing support to establish innovative service businesses through useroriented public data connection or use and platform improvement. They are also facilitating global measures for creating values based on public data. As for Korea, Gov 3.0 has emerged as a governmentwide innovation strategy, which is aimed at creating added values and jobs through disclosing, opening, and using public data. 4) Third, concentrated support should be provided for exploring new ICTbased businesses and facilitating competitive SMEs or venture businesses, by tackling current institutional issues such as various regulations and dispersed support policies. 5) In other words, the need for facilitating ICT startups and economic contribution will further grow with unconstrained use of ICT. 2) Computing technology that is related to or developed by emotions or other emotional phenomena, or that has intentioned impact on emotions. 3) Samsung Economic Research Institute, ) In Korea, public administrative institutions are providing 2,260 types of data for disclosure (view only) via 2,194 websites, which does not meet the level for use in service creation. 5) As of 2011, among the world's top 250 ICT businesses, US has 82, Japan 49, and Taiwan 18, whereas Korea has only 5. 9

12 3. Achieving Digital Creative Korea for National Happiness A. Informatization Promotion Framework It has been debated by the new government upon its inauguration in 2013 that it was a wrong decision to deconcentrate the integrative IT policy functions of Ministry of Information and Communication to multiple ministries during the government restructuring back in In this regard, discussions have continued at the end of President Lee Myungbak administration as to which ministry should be selected as the IT policy control tower taking full responsibilities, focusing on IT industry facilitation, technology development, and communications infrastructure as the main tasks of the new administration. As the result, the new government came to establish Ministry of Science, ICT and Future Planning (MSIP) that manages government operations related to ICT. MSIP incorporates not only science and technology and ICT, but also industryacademic collaboration for R&D (Ministry of Education), and Korea Post (Ministry of Knowledge Economy) as the key ministry for developing future growth engines and creating jobs in the new government. Internally, it has two viceministers one for science and technology policies and R&D, and the other for ICT the second Vice Minister takes care of Korea Communications Commission s convergence of broadcasting and communications, Ministry of Public Administration and Security s national informatization, Ministry of Culture, Sports, and Tourism s digital contents, and Ministry of Knowledge Economy s software promotion (refer to Figure 1). Figure 1 ICT Functions Transferred to MSIP Ministry of Science, ICT, and Future Planning (Vice Minister II) Korea Communications Commission Ministry of Public Administration and Security ( Ministry of Security and Public Administration) Ministry of Knowledge Economy ( Ministry of Trade, Industry and Energy) Ministry of Culture, Sports, and Tourism Convergence and promotion of broadcasting and communications, and radio regulation National informatization, information security, and information culture ICT industry, post, postal money and transfer, R&D Digital contents promotion, broadcasting advertising National Informatization White Paper

13 3. Achieving Digital Creative Korea for National Happiness In order to meet the goal of government restructuring, national informatization promotion framework came to face another set of changes. The President s Council on Informatization Strategies which had been based on the Framework Act on National Informatization will be removed and ICT Strategy Council (tentative) will be established with the enactment of the Special Act on ICT Promotion and Convergence Facilitation (hereinafter called ICT Special Act ) 6). The CIO Council, which was established based on the Framework Act on National Informatization will still remain part of the framework for implementing national informatization. B. ICT Strategy Council and CIO Council In order to deliberate and decide on policies regarding ICT promotion and convergence facilitation, the ICT Strategy Council (tentative, hereinafter called Strategy Council ) is to be established under the Prime Minister, consisting of 25 members at most, including one chairman and one advisor, whose roles will be taken respectively by the Prime Minister and the Minister of Science, ICT and Future Planning. The members will be heads of central administrative institutions as defined by the Presidential decree and the private sector experts who are appointed by the Prime Minister. The Strategy Council will deliberate and decide upon the master plan for ICT promotion and convergence facilitation, which is established every three years. It will also deliberate on the analysis, review, and evaluation of performances from the master plan and action plans for ICT promotion and convergence facilitation, which are established by heads of the central administrative institutions each year to elaborate the master plan. The Strategy Council can also demand heads of the central administrative institutions to take actions to improve laws for ICT promotion and convergence facilitation, recommend priorities in related R&D projects, coordinate policy issues and businesses between related central administrative institutions, and deliberate on the progress of national informatization based on the Framework Act on National Informatization. Figure 2 ICT Strategy Council For streamlined businesses of the Strategy Council, Working Committee for ICT Facilitation (hereinafter called Facilitation Working Committee ) will be established within the Council. The Facilitation Working Committee will receive complaints or suggestions from groups or businesses involved in ICT and seek for measures for improvement for ICT promotion and convergence facilitation. The Facilitation Professional Committee ICT Strategy Council Working Committee for ICT Facilitation Professional Committee Chairman: Prime Minister Members: related ministers and private experts Advisor: Minister of MSIP Chairman, members, and other matters regarding composition yet to be decided Professional Committee 6) to be enforced from February

14 Working Committee can accommodate dispatched officials appointed by the heads of related central administrative institutions, public agencies, or other related organizations and groups, when necessary for facilitated business process. To support the Facilitation Working Committee, professional committees can be also installed, consisting of experts in technological, legal, and other areas of profession. The professional committees will include the areas of planning and coordination, ICT convergence, software, digital contents, and information security (refer to Figure 2). The Council on Informatization Strategy, which was organized based upon the Framework Act on National Informatization, was abolished through government reorganization, and the CIO Council is now the only organization through which multiple ministries can collaborate and discuss on issues regarding ICT. Both ministers of MSIP and MOSPA are cochairmen of the CIO Council, and its advisors are highlevel officials who take the responsibility of informatization affairs in both MSIP and MOSPA. CIOs of government institutions are mostly deputy ministers and director generals, who carry out planning and coordinating affairs in their organizations. In central administrative institutions, deputy ministers for planning and coordination in ministeriallevel institutions, and directors of planning and management or highlevel officials who are in charge of informatization affairs in vice ministeriallevel institutions are taking the role of CIO. In local governments, deputy ministers or directorgenerals for planning and coordination, who coordinate policies and plans and manage spendings, laws, and administrative affairs, are working as CIOs. The CIO Council is currently under operation with the aim of coordinating ICT projects among ministries and discuss on the measures for information connection and sharing, therefore, a workinglevel meeting of all officials taking charge in informatization in the entire ministries. It is also a substantive organization for mutual collaboration and coordination as well as sharing of experiences and information in carrying out activities for interministerial informatization projects and information resource management. However, the share of fulltime Council members, who can perform roles and functions faithfully is only 30%, whereas the share of members who hold additional positions is 70%, which is pointed out as the limitation of facilitating the CIO system. C. The 5 th National Informatization Master Plan As the new paradigm for national informatization shifts from ICToriented growth and expansion to ICT application and utilization in the entire society, there is an increasing need for building a foundation for future development of the country based on the accumulated IT assets. Making of Korea s national informatization plans has progressed from establishment of the Plan for Achieving the Creative Economy and the Gov 3.0 Master Plan in June 2013, to Plan for Contents Industry Promotion and Comprehensive Measures for Information Security Industry Development in July, Committee for Facilitating Smart Media Ecosystem in September, Plan for Creative Vitamins Project and Smart Work Portal System Service in November, and finally to the 5 th National Informatization Master Plan at the end of the year The Plan for Achieving the Creative Economy sets out creating jobs, entering the global market at fullscale, National Informatization White Paper

15 3. Achieving Digital Creative Korea for National Happiness and achieving a creativityoriented society as the goals for ultimately establishing the creative ecosystem. At the same time, the Creative Vitamins Project introduces the objective of revitalizing science and technology along with ICT as a means to develop growth engines for pioneering new industries and markets. Measures for promoting the contents industry in the industrial sector and facilitating the smart media ecosystem in the media sector will enable codevelopment of contents and media in a stable and advanced ecosystem, and the Smart Work Portal System will provide a new foundation for economic development. In order to provide a more stable environment, the Comprehensive Measures for Information Security Industry Development were established, adding to the efforts to establish an ICT environment, which citizens can rely upon and use conveniently. Also by establishing the Gov 3.0 Master Plan for service development in the public sector, measures have been provided to enhance government services as well as citizen satisfaction and consolidate global achievements that have been accumulated so far. Figure 3 ICT Functions Transferred to MSIP Vision Achieving a digital creative Korea for citizens happiness Objectives Dynamic Economy Good and Worriless Citizen Life Digital Environment Allowing Coexistence in Trust 4 Strategie Creative Economy Optimized Society via ICT Renewed Human Capacity Enhanced ICT Infrastructure Leading creative economy through informatization Creative use of ICT by the society Improve creative capacity of citizens Improve infrastructure for digital creative Korea 15 Tasks Rearing new industry that is based on national data Create demand through new technology expansion Strengthen capacity of ICTbased creative businesses Establish foundation for new Internet business startups Achieve intelligent and customized administration for citizens Ensure healthy citizen life via ICT Create prosperous and intelligent living environment Establish ICTbased national and social security network Make new SOC intelligent in a sustainable way Improve futureoriented ICT capacity Maintain healthy Internet culture Achieve indiscriminate information welfare Establish intelligent future network Establish foundation for cyber safety Improve system for national information resources 13

16 The 4 th National Informatization Master Plan of 2008~2012 had the vision of achieving an advanced knowledge information society based on creativity and trust. The following 5 th National Informatization Master Plan (2013~2017), established in 2013, offers smart infrastructure and ITled creative economy as the key values, in addition to the ones from establishing the national infrastructure, which had been implemented through the 1 st to 3 rd Master Plans, and achieving the knowledge information society as implemented through the 4 th Master Plan. The vision of the 5 th National Informatization Master Plan is achieving a digital creative Korea for citizens happiness. Three objectives to realize the vision are dynamic economy, good and worriless citizen life, and digital environment that allows coexistence in trust. Four ICT CORE strategies for achieving the digital creative Korea include Creative Economy, Optimized Society via ICT, Renewed Human Capacity, and Enhanced ICT Infrastructure (refer to Figure 3) National Informatization White Paper

17 4. Informatization Level 4. Informatization Level The global informatization indices of 2012, published by major international organizations, include the World Economic Forum(WEF) s Global Competitiveness Index (Technological Readiness) (September 2012) and Networked Readiness Index (April 2012), and International Institute for Management Development(IMD) s World Competitiveness Scoreboard (Technological Infrastructure). United Nation(UN) s Egovernment Development Index and Eparticipation Index, both of which are published on a biennial basis, started carrying out online evaluations of websites of each country in 2011 for 2012 evaluation. International Telecommunication Union(ITU) s ICT Development Index, which had been published in March every year, was delayed in 2012 and published in October. The indices published in the second half of 2011 and the first half of 2012 show that Korea s ranking in WEF s Networked Readiness Index fell from the previous year, but its rankings in other indices went up. In particular, Korea ranked the top for two consecutive surveys in UN Egovernment Development Index and Table 2 Korea s Rankings in Global Indices [Organization] Index [UN] Egovernment Development Index Objective Measures capacity and will in using egovernment for ICTbased national development Korea's Rank(No. of Countries Surveyed) (192) 1 (192) 1 (193) [UN] EParticipation Index Measures level of online participation of citizens in decisionmaking for public policies 2 (192) 1 (192) 1 (193) [ITU] ICT Development Index Measures development level of information society and information divide in each country 2 (154) 3 (159) 1 (155) [WEF] Networked Readiness Index Measures level of ICT utilization for economic development and competitiveness 14 (115) 19 (122) 9 (127) 11 (134) 15 (133) 10 (138) 12 (142) [WEF] Global Competitiveness Index (technological readiness pillar) Measures competitiveness in the area of technology 12 (125) 7 (131) 13 (134) 15 (133) 19 (139) 18 (144) [IMD] World Competitiveness Scoreboard (technological infrastructure) Measures competitiveness in the area of ICT 6 (53) 6 (55) 14 (55) 14 (57) 18 (58) 14 (59) 14 (59) Source: 1) ITU: International Telecommunication Union, a specialized agency of the United Nations that is responsible for ICT issues 2) WEF: World Economic Forum, also called Davos Forum 3) IMD: International Institute for management Development, a business school located in Geneva, Switzerland 4) EIU: The Economist Intelligence Unit, consulting body of the Economist group 15

18 Eparticipation Index of both 2010 and In addition, it also ranked the top in ITU s ICT Development Index in 2012, after ranking in the second place in the first survey in 2009 (refer to Table 2). A. Networked Readiness Index The Networked Readiness Index is an index developed by the World Economic Forum (WEF), which measures the level of ICT use in each country for developing economy and improving competitiveness. Compared to 2011, Korea fell two notches down to 12 th among 142 countries in 2012, now being outside top 10. As for the subindices, Korea s rankings dropped in the Political and Regulatory Environment, while the pillars of Market and Infrastructure Environments were deleted and Business and Innovation Environment added. In terms of Readiness subindex, in which Korea fell seven notches from the previous year, the pillars of Individual Readiness, Business Readiness, and Government Readiness were all deleted, and instead, Infrastructure and Digital Content, Affordability, and Skills were added. Korea also fell one notch in Usage. The Impact subindex is new, adding pillars of Economic and Social Impacts (refer to Table 3). Table 3 Korea s Ranking in Subindices of Networked Readiness Index Evaluation Ranking Subindex Comment Average 12 th 10 th 2 Environment Readiness Usage Impact 35 th 24 th 2 nd 4 th 27 th 17 th 1 st added Pillars Pillar Market Environment Political and Regulatory Environment Infrastructure Environment Business and Innovation Environment Individual Readiness Business Readiness Government Readiness Infrastructure and Digital Content Affordability Skills Individual Usage Business Usage Government Usage Economic Impact Social Impact Ranking Comment 43 rd 41 st 15 th 18 th 70 th 27 th 2 nd 12 th 1 st 12 th 1 st 53 rd 15 th added 19 th 16 th 22 nd 4 th 2 nd 1 st deleted 2 deleted deleted deleted deleted added added added added added In detail, Korea was in top 5 in terms of Tertiary education gross enrollment rate (1 st ), Impact of ICT on new services and products (2 nd ), Extent of business Internet use (2 nd ), and Broadband Internet subscriptions per 100 inhabitants (4 th ); however, Korea was found weak in Effectiveness of lawmaking bodies (123 rd ), National Informatization White Paper

19 4. Informatization Level Venture capital availability (100 th ), Mobile cellular tariffs (84 th ), International Internet bandwidth (66 th ), and Mobile phone subscriptions per 100 inhabitants (62 nd ). In particular, the low level of mobile phone subscription is due to the special environment of mobile communications market in Korea, where there are only few cases of subscribing to prepaid mobile phone unlike other countries compared. Therefore, strictly speaking, this can be considered as an indicator lacking representability for one that compares pure number of subscriptions of each country (refer to Table 4). Table 4 Korea s Strengths and Weaknesses in Indicators of Networked Readiness Index Subindex Environment (27 35) Readiness (17 24) Usage (1 2) Strengths No. of days to enforce a contract (3 rd 3 rd ) Tertiary education gross enrollment rate (1 st 1 st ) Broadband Internet subscriptions (5 th 4 th ) Extent of business Internet use (3 rd 2 nd ) Impact of ICT on new services and products (3 rd 2 nd ) Government Online Service Index (3 rd 1 st ) EParticipation Index (1 st 1 st ) Weaknesses Intellectual property protection (43 rd 46 th ) No. of procedures to start a business (76 th 28 th ) Effectiveness of lawmaking bodies (131 st 123 rd ) Internet & telephony competition (1 st 79 th ) Mobile cellular tariffs (83 rd 84 th ) Fixed broadband Internet tariffs (67 th 68 th ) Quality of math & science education (18 th 12 th ) Mobile phone subscriptions (60 th 62 nd ) Note: 1. Indicators in which Korea is strong are those where Korea is in top 5; indicators in which Korea is weak are those where Korea is ranking 50 th or lower. 2. ( ) shows ranking changes from B. National Competitiveness Indices WEF s Global Competitiveness Index (Technological Readiness Pillar) In general, WEF s Global Competitiveness Index is published six months before Networked Readiness Index, and indicators related to ICT and general market environment are also applied to measuring the Networked Readiness Index of next year. While IMD s World Competitiveness Scoreboard measures business competitiveness to evaluate Table 5 Pillar Technological Readiness (18 18) Korea's Rankings in Technological Readiness Pillar of WEF Global Competitiveness Index Indicator Availability of latest technologies Firmlevel technology absorption FDI and technology transfer Individuals using Internet International Internet bandwidth Fixed broadband Internet subscription Note: Indicators that are directly related to the ICT sector are in italics. Ranking ( )

20 national competitiveness, WEF s measurement focuses on national productivity. In 2012, Korea is remaining in the 18 th place under the pillar of Technological Readiness in WEF s Global Competitiveness Index since the previous year. Korea s rankings in ICT indicators are 11 th in Individual using Internet, climbing a notch from the previous year, and 67 th in International Internet bandwidth, which is a low mark gained from relatively abundant Internet contents and being a nonenglishspeaking country. However, the ranking in Fixed broadband Internet subscription is 5 th, up a notch from the previous year, proving that Korea is still one of the world s leading countries in this area (refer to Table 5). IMD s World Competitiveness Scoreboard (Technological Infrastructure) Unlike WEF, IMD is measuring national competitiveness based on business competitiveness, and its indicators, published in June 2012, showed Korea s technological infrastructure ranking 14 th out of 59 countries, which is about the same level as the previous year. One of the higher rankings of Korea, as IMD has evaluated, was 4 th in Communications technology, which climbed five notches from the previous year. On the other hand, indicators like Internet bandwidth speed (42 nd ), and Mobile telephone subscribers per 1,000 inhabitants (40 th ) were still lagging behind (refer to Table 6). Table 6 Korea s Strengths and Weaknesses in World Competitiveness Indicators Subfactor Strengths Weaknesses Technological Infrastructure (14 14) Fixed telephone lines per 1,000 inhabitants (9 th 4 th ) Note: 1. Strengths and weaknesses are analyzed by IMD 2. ( ) shows changes from Qualified engineers (41 st 48 th ) Technological cooperation (31 st 37 th ) National Informatization White Paper

21 5. Egovernment 5. Egovernment A. Egovernment Strategy President Park Geunhye administration, which took off in February 2013, set Gov 3.0 as the national goal and introduced the vision of breaking down barriers between ministries using egovernment, establishing a transparent government that informs citizens of all affairs of the government by disclosing and opening up administrative data to the public, achieving a capable government that leads the future through knowledge creation, accumulation, and sharing, and based upon this, achieving a service government that provides administrative services that are customized to individual citizens. Gov 3.0, as introduced by President Park s administration, is a new government operational paradigm that proactively discloses and shares public data, communicates with the citizens, and facilitates collaboration without borders between ministries. Upon the start of the new government, President Park s administration has made fullscale efforts to visualize Gov 3.0 through providing customized services, facilitating institutional collaboration, and utilizing big data. For this, the government made a preannouncement of the amendment of EGovernment Act, which will lead to operation of a public service registration system for usercustomized services, further allowing civil applicants to receive a comprehensive range of public information only by onetime application. Regulations will be developed, ensuring civil applicants to view life information such as their health and assets via Minwon24 without having to visit each government office, along with other measures for stepping up interministerial collaboration. These measures include interconnecting and integrating systems of each institution and breaking down barriers between institutions for enhanced administrative efficiency and integrated and streamlined provision of civil services. In addition, the foundation for scientific administration for big data use has been also established. Led by Ministry of Security and Public Administration, which had undergone a name change from Ministry of Public Administration and Security during the government reorganization, legal grounds for a common platform for data sharing has been established, which will allow the public data collected via the platform to be shared by each institution. In order to improve the egovernment security level, the government decided to expand the coverage of institutions that must establish electronic civil service security measures of their own further to other public institutions, and step up implementation of security measures for software development and operation. In addition, it also plans to facilitate the audit market, which might be intimidated by the introduction of PMOs, by holding video conferences for mitigating regulations and enhancing business efficiency, and expand the coverage of institutions that fall under the group for integrated management of information resources from central administrative institutions to other public institutions. Such revisions to the Electronic Government Act have been recognized as the key means for successful Gov 3.0, and many has come to expect that the new government will become a capable government, trusted by 19

22 the citizens, and bringing citizens happiness to the next level. Administrative Informatization Projects for Achieving Gov 3.0 A significant part of tasks for Gov 3.0 is about provision of government services via ICT. Therefore, most of the Gov 3.0 tasks are directly or indirectly related to informatization or egovernment. In this regard, each ministry is concentrating upon Gov 3.0 with its capacities in implementing egovernment and administrative informatization. The number of administrative informatization projects to be carried out by both the central and local government institutions in 2013 is 6,430 in total, and the allocated budget is KRW trillion. Central administrative institutions invested KRW trillion to 730 projects, while local government institutions invested KRW billion to 5,700 projects. In terms of the project type, planning and development or construction projects is 1,556 in number with the allocated budget of KRW trillion, accounting for 45.3% of the total informatization budget, and consisting of 0.4% planning projects and 44.9% development or construction projects. Of these projects, there are 75 projects that are related to Gov 3.0 with the budget of KRW billion, taking up 4.6% of the total informatization budget and 13.7% of planning and development or construction projects. Among the projects related to Gov 3.0, the share of projects for establishing a collaboration framework between the private sector and ministries is 50%, while the share of projects for public data disclosure and use is 25%, illustrating that the focus is on provision of customized government services and data disclosure. B. Status of Egovernment Implementation Thanks to consistent efforts in UN EGovernment Development Index Table 7 developing egovernment and Online Service Development of Korea implementing national informatization, Stage Stage 1 Stage 2 Stage 3 Stage 4 Korea has become a leading e Year (Emerging) (Emerging) (Transactional) (Connected) Achievement government country, which United Nations (UN) has evaluated as the top % 97% 79% 91% 92% 66% 87% 62% 87% 78% country in both Egovernment % 93% 50% 59% 73% Development Index and EParticipation Source: UN, egovernment Survey 2012 ~ 2008 Index 7). In Egovernment Development Index 8), which measures egovernment levels of 190 countries worldwide, Korea leapfrogged from 15 th place 7) Upon recognizing egovernment as an important tool for public reform, UN has published the EGovernment Development Index since 2001 by measuring egovernment levels of member countries. Since 2003, EParticipation Index has been added to enhance transparency of government businesses and services and improve democracy, ultimately to facilitate egovernment development through increased citizen participation via electronic means. 8) Former EGovernment Readiness Index the index name changed in National Informatization White Paper

23 5. Egovernment in 2001 to the top in 2010, and in E Participation Index, it was ranked the top for both 2010 and In the area of online services, Korea has achieved 87% of services online, also reaching 87% of Connected stage, the top level of e government development as introduced by UN (refer to Table 7, 8). Table 8 UN EParticipation Index Achievement of Korea by Subindex Subindex Year EInformation Econsultation % 75% 78.79% 78% Source: UN, egovernment Survey 2010, Edecision making 75.00% 100% Total 78.95% 81% In addition, Korea s informatization level has not only been globally acknowledged as it ranked the top for three consecutive years in ITU s Digital Opportunity Index, but the results of Korea s egovernment services have been selected as the best practices, with the excellence also being acknowledged by the world. For example, with the ecustoms system called UNIPASS that has completed an online export and import system for the first time in the world, Korea Customs Service won the WCO (World Customs Organization) Trophy for intellectual property right protection with the fastest customs system among 169 member countries. Korea Online Eprocurement System (KONEPS) is showing splendid achievements by winning the UN Public Service Award (PSA), being selected by OECD as one of the best cases for improving transparency, and winning the Global IT Excellence Award from World Congress on Information Technology (WCIT). The demand for electronic procurement from developing countries is also increasing constantly. In addition, results from egovernment development efforts are being visualized in many other areas the Internet tax service called Home Tax Service was introduced as one of the best online tax administration models by OECD; and the epeople website for online participation of citizens was selected as one of the top 10 services back in 2006 World Egovernment Forum (refer to Table 9). Table 9 International Acknowledgement and Awards for Korea's Egovernment System Operation Organization Acknowledgement Year KONEPS (Eprocurement) KISS(Eimmigration) UNIPASS (Online customs service) HomeTax InVil(Information Village) OnNara (Business Process System) EPeople (OPPS) Public Procurement Service Korea Customs Service National Tax Service Ministry of Security and Public Administration Anticorruption and Civil Rights Commission UN OECD WCIT UN UN WCO AFACT OECD UN World Edemocracy Forum EChallenge World Egovernment Forum Public Service Award Best practice for improving transparency Global IT Excellence Award Public Service Award Best practice for anticorruption Trophy for IPR Protection easia Award Best practice for online tax administration Public Service Award Top 10 Demonstration Top