The policy emerged largely in the context of the growing economic gap between the two Koreas: the South was strengthening itself and experiencing economic prosperity that had begun under President Park Chung-hee in the 1970s while the North was experiencing severe economic decline and faced bankruptcy. While the government spent an excessive portion of its budget on its military and nuclear program, the people experienced widespread starvation. Sunshine Policy was aimed at mitigating this gap in economic power and restoring lost communication between the two States.
