Infrastructure, consumer and e-commerce
were the keywords at the 2017
Forum on Global Market Entry
Strategies. Held on January 10 at COEX
InterContinental Hotel in Seoul, the event
took place to help Korean SMEs boost
their exports amid the recent slump in
exports. The meeting, which is in its 18th
year, kicked off with an opening speech
by Jaehong Kim, CEO and President of
KOTRA, followed by a congratulatory
remarks by Cheong Man-ki, Vice
Minister of Trade, Industry and Energy.
“Korea’s export environment will get
better this year compared to last year,”
said Kim, who pledged to identify new
opportunities in each market, deploy tailored
marketing strategies, actively support
consumer good and service industries
and respond to new ways of trade so that
SMEs and corporations of middle standing
can boost their exports.
Approximately 500 industry insiders
participated at the meeting, which invited
director generals from KOTRA’s 10
regional headquarters. The director generals
presented on key economic issues and
market entry strategies for companies
seeking to expand their business on an
international scale. As the income for the
middle class continues to grow in major
markets like the United States, China and
India, the demand for
consumer goods
and subsequently the need for premium
goods are also increasing. Thus, utilizing
e-commerce technologies, the Korean
Wave and Korea’s comprehensive FTA network will be the key to expanding
exports in these markets.
At the forum, Jongchoon Kim,
Regional Director General for North
America, stated that because America's
highly-educated middle class is growing,
tapping into newly rising markets, including
on/offline distribution markets and
government procurement markets, is vital.
“For the distribution market, we need to
more closely cooperate with purchasing
managers of headquarters and power vendors,
among others. We can also indirectly
enter the government procurement
market by working with preferred government
subcontractors,” said Kim.
Along with the United States, China is
another country that is strengthening economic
ties with Korea. Thus, the forum
stressed that
Korea should more efficiently
utilize the Korea-China FTA to meet
the demand of the Chinese market, which
is Korea’s largest export market. Gwangyoung
Chung, Regional Director General
for China, stressed the importance of urgently responding to the needs of newly
rising Chinese consumers in the premium
goods market. He suggested examining
new consumption trends in order to read
such needs; for instance, utilizing power
bloggers and O2O (Online to Offline)
services.
Chung also emphasized that Korea can
enter the consumer goods market with the
help of growing online distribution channels
and the Korean Wave in the
Southeast Asian markets, where exports
and investment are increasing rapidly, as
well as the Southwest Asian market,
where remarkable economic growth is
taking place. The Middle East, Central
America, and Africa are also expected to
see an increase in domestic demand
thanks to the growing middle class,
newly
rising consumer groups and changing
trends.
The presenters noted the rise of the ecommerce
industry and its impact on the
global market. The market size of the ecommerce
industry is fast increasing in Europe, Japan, India, China, Southeast
Asia and Central America. According to
e-Marketer, the global e-commerce market
recorded USD 1.3 trillion in 2014, and
it is expected to reach USD 3.4 trillion by
2019.
Furthermore, participants commented
on the importance of strengthened infrastructure.
“The political situation in the
Middle East is becoming more stable. We
thus need to diversify our export channels
for infrastructure projects and relevant
materials,” says Yongsuk Kwon, Regional
Director General for the Middle East.
“We should increase our investment in
small and medium-sized plant construction
projects in response to industry diversification
policies of Middle Eastern countries,
while focusing on mega projects
such as the 2020 Dubai Expo.”
Other countries are also set to invest in
infrastructure development this year. The
United States will assign USD 1 trillion to
infrastructure development, whereas
countries in Eastern Europe will carry out
various infrastructure projects with EU
Funds. Africa is a promising export market
for Korea when it comes to small and
medium-sized plant construction projects,
as well as manufacturing equipment.
In addition, participants called for
Korea to proactively engage in cooperation
with international policies. For
instance, as the Indian government is pursuing
the “Make in India” policy with an
aim to nurture the country’s manufacturing
industry, Korea can increase its
exports to India in the parts and machine
industries. At the same time, the two contries
can cooperate to build smart cities.
Korea must also prepare for a change in
China, as it is expected to improve the
competitiveness of its manufacturing
industry with China Manufacturing 2025.