Anchor: South Korea's per capita gross domestic product is expected to match that of Japan by 2020. South Korea has been steadily growing while Japan suffered through slow growth and deflation. But analysts say South Korea has to increase investments in research and development in order to advance its economy, which lags behind Japan in the high-tech sector.
Our Kim In-kyung has more.
 
Report: South Korea has been closing the economic gap with Japan as the former second-largest economy in the world has been mired in deflation.
 
According to the International Monetary Fund's (IMF) world economic outlook database on Thursday, South Korea's per capita gross domestic product (GDP) is expected to reach 37-thousand dollars in five years, similar to Japan’s.
 
South Korea's nominal GDP per person was 28-thousand dollars last year, but is expected to increase 31 percent by 2020 to 37-thousand dollars.
 
On the other hand, Japan's GDP per person is likely to expand six percent from 36-thousand dollars to 38-thousand dollars during the same period.
 
Ten years ago, South Korea's per capita GDP was only half that of Japan's at 18-thousand dollars compared with 35-thousand dollars in Japan.
 
South Korea's GDP is also projected to increase to one-point-nine trillion dollars by 2020, reducing the gap with Japan from more than three times to two-point-four times.
 
According to the IMF, South Korea accounted for three-point-three percent of the world's exports between January and May this year, placing sixth while Japan ranked fourth at three-point-nine percent.
 
However, despite the downturn of the past 20 years, Japan is still at the top of high-tech sectors such as biotechnology and high-precision medical devices.
 
Analysts say that in order to advance its economy and break from its position between Japan and China, South Korea has to invest in next-generation technologies such as environment-friendly industries and those related to the Internet of Things (IoT).
 
South Korea's GDP to research and development ratio is one of the highest in the world, but the nation still lags behind Japan in overall investment.
Kim In-kyung, KBS World Radio News.