Why should I consider exporting to South Korea?

October 10, 2019

South Korea is home to some of the world’s biggest conglomerates, including Samsung, Hyundai, LG and SK, and is also a leading global exporter of semiconductors, telecommunications equipment, automobiles, chemicals, ships and consumer electronics. The country leads the world in broadband internet penetration and has one of the world’s highest rates of internet and mobile telephone use. With the EU-South Korea FTA providing a positive backdrop, this is a country which offers business strong opportunities for firms willing to make the commitment needed for export success.


South Korea has made many economic efforts in the last four decades. It maintains a very low inflation rate (1.1%), a policy of opening to foreign investments and high national savings.


The result is a powerful high-tech industry in sectors such as electronics, car production, chemicals, shipbuilding and steel derivatives, and great international confidence worldwide.


According to the Korean Ministry of Commerce, Industry and Energy, the promises of Foreign Direct Investment (FDI) in this country were increased during the first half of 2014, which reinforces this emerging power as a destination for investment capital. The increase is based on strong Chinese investment, although the main conclusion is that companies' confidence to invest in the Korean economy grows.


The figures provided by the Korean Ministry of new promises for the first half of the year (USD $10,070 million dollars) represent an increase of 39% over last year, while the total real investment (USD $6770 million dollars) also represents a Record in capital raising, recording an increase of 57% compared to the same period of 2013.


This Asian country is growing at a rate of 4%, a weight of the latest downward revisions to the cause of the risk that Korea represents North and the strengthening of its local currency, livestock, which detracts competitiveness from South Korean companies and reduce their profits when they are distributed among shareholders. Despite these negative factors, South Korea had a trade surplus in June of $ 5.290 million, mainly, thanks to the increase in exports of technology products and steel products. With this month there are already 29 followed with surplus.


Korean exports grew this month at a rate of 2.5% per month, reaching 47.840 million dollars and imports registered an increase of 4.5% to reach the amounts of 42.550 million dollars. Korean companies dedicated to the sale of semiconductor mobile communication devices, high-end televisions, LCD and steel products were the fastest growing in this period. Sales of petroleum products and automobiles fell.


The top export destinations of South Korea are China ($149B), the United States ($69.4B), Vietnam ($47.7B), Hong Kong ($34.8B) and Japan ($26.9B). The top import origins are China ($98.1B), Japan ($54.2B), the United States ($48.7B), Germany ($19.7B) and Other Asia ($18B).