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Seoul-ful The capital's glittering cityscape reflects a very happening place (photograph by Jean Chung for TIME(WORLD SECTION/EXCERPTS) When I relocated from New York City to Seoul, South Korea's capital, in 1996, I found the city vibrant and fascinating, but also surprisingly provincial. Koreans preferred their fermented kimchi over any other food, and though I grew to enjoy the spicy staple, a longing for familiarity and the feebleness of my digestive system occasionally demanded a respite from the chili-laden cabbage. That proved challenging. Aside from some fast-food joints and wallet-straining restaurants at five-star hotels, foreign cuisine was hard to come by. It's why I have such fond memories of Lee Je Chun. While studying and working in Germany, Lee acquired a taste for things European, so in 1992, he opened the Jell, a shop that sold wine, cheese, pasta, sausages and other imported delicacies. The occasional chunk of cheddar I'd buy was a cherished reminder of a home far away.

A few weeks ago, I returned to my old neighborhood in Seoul for the first time in 10 years, and much to my surprise, Lee and the Jell are still there. But it wasn't the same place where I shopped in the 1990s. Lee no longer sells food: foreign goodies can now readily be found at supermarkets and Costco outlets. Instead, Lee has built a private club for wine lovers, where he hosts tastings for members who pay a $900 annual fee. In its earlier form, the Jell catered largely to expatriates; today the wine club's members are nearly all locals. Koreans have caught on to the pleasures of a good wine. "Korea has changed a lot," Lee says. "Koreans are opening their minds."

The results are striking. Thirty years ago, Korea was poorer than Malaysia and Mexico. Since then, its GDP per capita has surged by a factor of 10 to $17,000, more than double the levels in those countries. GDP growth was 0.2% in 2009, when much of the rest of the world was contracting, and is estimated to be 6% this year. Yet when I left Korea in 2000, it was an open question whether its success could continue. The embarrassing memories of the 1997 Asian financial crisis were still fresh, and Koreans were worrying that they would lose out to a rising China.

Over the past decade, however, Korea has reinvented itself — it's an Asian miracle again. Korea has become an innovator, an economy that doesn't just make stuff, but designs and develops products, infuses them with the latest technology, and then brands and markets them worldwide, with style and smarts. Samsung and LG, not the Japanese electronics giants, are dominating the hot new LCD-TV business. In 4G phone technology, Samsung is poised to become a leading force, while Hyundai Motor, an industry joke a decade ago, is a top-five automaker, its rising market share fueled by quality cars and nifty marketing. "'Made in Korea' used to be synonymous with cheap and imitative," says Bernie Cho, president of DFSB Kollective, a start-up that markets Korean pop music internationally. "Now it's become premium and innovative." New industries, from online games to pop music, have emerged as powerhouses. Politically as well, Korea is stepping out of Washington's shadow and becoming an influential voice in its own right. Symbolic of that new role, Seoul is hosting the G-20 summit on Nov. 11 and 12, the first Asian country to do so. This nation is a global leader-in-waiting.

Part of Korea's success is simple commitment. Koreans spend some 3.5% of their GDP on R&D, compared with 1.5% in China and less than 1% in Malaysia and India. Innovation, however, isn't something that can be conjured up in government offices or corporate boardrooms. You can tell people to work harder or build a more modern factory, but you can't order them to think better or be more creative. That change has to take place inside people's heads. In Korea, it has. Koreans have become more accepting of diversity and outside influences and quicker to shed old prejudices. Such an outlook was brought about by a fundamental (and continuing) reformation of Korean society. Koreans are breaking down the barriers that held the nation back, a process fostered by political freedom and a passionate embrace of the forces of globalization." Says Cho: "Korea has gone from being a hermit kingdom, from a closed door, to open arms."

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.

http://www.time.com
By Michael Schuman (with reporting by Lina Yoon)

Featured Artist : Drunken Tiger
Featured Commentator : Bernie Cho [DFSB Kollective]