Invest KOREA

(SEOUL=Yonhap News) Export items and methods evolve along with the changing times.

At the 11th Trade Investment Promotion Meeting on Feb. 27 presided by Acting President and Prime minister Hwang Kyo-ahn, the Ministry of Trade, Industry and Energy suggested the diversification and sophistication of export items as one way to push exports back into positive territory this year.

As its annual goal, the Ministry aims to see a minimum USD 27 billion in exports for the five consumer good categories of cosmetics; medical supplies and pharmaceutical drugs; agricultural and marine products, foods; household goods; and clothing and accessories. If successful, it will be a 14.9% increase from the USD 23.5 billion from the previous year, and significantly higher than the 2.9% increase expected for all export categories in Korea.

The growth in the five categories will be led by efforts in cultural convergence marketing and specialized marketing for each item.

A good example would be the exposure of products made by Korean companies through product placements (PPL) in Korean television shows and movies, which are gaining popularity throughout the world.

Before the end of the year, the Ministry plans to hold four PPL fairs to match small and medium businesses with television drama production companies.

Make-up products that see a significant rise in demand overseas will be supported so that 10 cosmetics companies can sell their products through global distributors such as Sephora or Boots.

For pharmaceuticals, exports will be promoted with a focus on vaccines to developing countries, through measure to simplify the WHO prequalification process.

In May and June, youth groups will be sent to Brazil and India, respectively, to advertise Korean agricultural foods and develop new markets, while the "K-fish" initiative will be launched next month, to promote promising processed marine products under one national brand.

The Ministry also plans to hold events to promote medical tourism and offer on-site experience opportunities by inviting the Chinese power blogger Wang Hong; joint produce animation series for overseas markets with foreign partner companies; and provide consultation on selling animation products to foreign publishers based in Europe or China.

Particular attention will be paid to promoting items that show promise in forming the future backbone of the Korean export industry.

Especially, tariff quotas for materials and equipment will be lowered to 0%  from the current 5 to 8%, so that investments in cutting-edge parts and next-generation items such as those using NAND flash memory and OLED technologies, may be carried out without setbacks.

A total of KRW 3.7 trillion will be invested in R&D for new industries, while separate strategies will be devised for each new industry item, such as energy storage systems and electric vehicles.

If existing exports relied on shipping by sea and air, from now on e-commerce is quickly rising as the new medium for trade.

The government has decided to remove all obstacles across the entire e-commerce process of product registration, sales, delivery and customs; and build a new policy fund to support online export companies.

It will also build a standardized Korean and foreign language database accessible by all industries by the end of this year, and lower the number of e-commerce export declaration items from 33 to 26.

In addition, of the total KRW 17.5 billion in funds to financially support exports by small and medium businesses, KRW 2 billion will be allotted as a special fund to help on-line small and medium companies, while some 2,100 such companies will be supported to enter online global shopping malls such as Amazon or Alibaba.

Meanwhile, the recent decision by China, currently the biggest market for Korean Wave products, to raise its trade barriers against Korea is being seen as a burden on Korean companies.

According to a Ministry source, "recently various measures are being taken to improve standards, such as on hygiene, in line with changes in the circumstances in China," adding, "since small and medium businesses lack the means to swiftly adapt to the new standards, either by acquiring information or responding to regulations, an information session needs to be held by related governmental organizations so that none has to suffer from any disadvantages as a result."

eun@yna.co.kr

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Source: Yonhap News (Feb. 27, 2017)