John Fogarasi, Minister CounselorU.S. Commercial Service KoreaU.S. Embassy, Seoul : John Fogarasi, Minister Counselor U.S. Commercial Service Korea U.S. Embassy, Seoul South Korea Trade Outlook 2007
April 2 - 3, 2007
South Korea Today : South Korea Today Sophisticated, Hi-tech, Dynamic
World’s 11th largest economy
Korea’s Global Trade Surpassed $600 billion
One of the Most 'Wired' Countries in the World
Over 86% of Korean Households have access to the Internet
Recognized Worldwide for IT manufacturing
Affluent, Up-Scale, Tech Savvy Consumers
South Korea Today II : South Korea Today II World Cup Seoul High Speed Train in Korea Seoul
Korea’s Economic Outlook 2007 : Korea’s Economic Outlook 2007 Korea – An Economic Miracle
40 years ago per capita GNP was $100, today it’s over $16,000
Balanced 4+% economic growth expected with trade leading the way at 10% per annum
Trends: Expect strong investment outside Korea; growth in consumer spending andamp; income growth; policy-makers watching appreciating currency, energy prices, andamp; corporate spending
U.S. Trade with Korea : U.S. Trade with Korea Korea is the United States’ 7th largest export market (greater than France, Holland, or Brazil)
$32.5 Billion (2006) in exports, up 17% from previous year
How does Korea rate globally for U.S. exports?
6th largest high tech market
5th largest agricultural market
United States is Korea’s 2nd Largest Trading Partner
U.S. Exports – An Overview : U.S. Exports – An Overview 92% of U.S. exports to Korea are non-Agricultural
Double-digit growth in Sales of Machinery and Manufactured Goods
Strong Growth Across-the-Board with Hi-tech, Consumer products, and Selected Foods including upscale items such as Prestige Cosmetics and Fine Wines
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U.S. Exports – An Overview II : U.S. Exports – An Overview II Over 40% of all U.S. exports are categorized as 'Advanced Technology Products (ATP)'
U.S. exports of ATP up 24% in 2006
Major growth in Electronics; Flexible Manufacturing; Aerospace; Advanced Materials, and Defense Equipment
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U.S. Investments in Korea : U.S. Investments in Korea The United States is Korea’s top investment partner
US investors confident in Korean economy
Citigroup - $2.7 Billion acquisition of KorAm Bank
GM - $1.5 Billion for Asian production platform
Gale - $20 Billion, world’s largest private real estate development
U.S. Investments in Korea II : U.S. Investments in Korea II Songdo New City Project
Why Kimberly-Clark Chose Korea : Why Kimberly-Clark Chose Korea 'Korea has world-class scientific talent and infrastructure. It also has sophisticated consumers – consumers, who can give us new product insights. Korea is also a culture that bridges the best of the East with an understanding of the West. This creates a highly favorable climate for innovation.'
Tom Falk
President andamp; CEO
Kimberly Clark
On the occasion of the grand opening of their first overseas Innovation Center, March 2, 2007 (Yongin, S. Korea)
Advantages of U.S. Products : Advantages of U.S. Products Recognized Reputation for Quality, Price, andamp; Innovation
Increasing Affluence andamp; Sophistication of Koreans
Korea’s Diminishing Resistance to Imported Goods
Appreciation of the Korean Currency
Growing Diversification of Market Channels andamp; SMEs
The Korea-U.S. Free Trade Agreement (KORUS)
Challenges for U.S. Products : Challenges for U.S. Products Koreans drive a hard bargain
Need to conduct standards and regulatory homework
Pay close attention to protecting your IP Rights
Need to cultivate business relationships
Accommodate to the uniqueness of Korea in packaging, product design, or market strategy
Be prepared for on-going contract discussions,
customs reviews, or regulatory challenges
The Korea-U.S. Free Trade Agreement : The Korea-U.S. Free Trade Agreement 'For the U.S., this would be our most significant trade agreement in 15 years.'
Carlos Gutierrez
Secretary of Commerce
December 12, 2006
What Will the KORUS FTA Mean? : What Will the KORUS FTA Mean? 2% Increase in Korean GNP
Increase in Korean Per Capita Income to $30,000
50% increase in U.S. exports
FTA: Building on a Strong Relationship : FTA: Building on a Strong Relationship Korea would become the United States’ first North Asian Free Trade Partner
U.S. andamp; Korea are already Ideal Trading Partners
No two FTA partners have such a Strong Reliance on Hi-tech and Innovation within their economies
No two trading partners are as close to each other in commitments to R andamp; D spending (OECD statistics)
No country has such a strong flow of students entering U.S. institutions of higher education as Korea – setting the stage for close cultural and business ties
Is Korea Only for Major Players? : Is Korea Only for Major Players? Headlines often focus on the billion dollar deals – and there have many in the recent past, BUT
Greatest Potential andamp; Greatest Growth is among SMEs on both sides of the Pacific
Korean medium-sized businesses are an excellent match for U.S. firms and are often the path to Korean major firms (Chaebols)
Defense/Aerospace : Defense/Aerospace Defense
Market size $4.9 B; annual growth 5%
Imports $630 M; US import share 66%
Best prospects: military aircraft, avionics
Aerospace
Market size $2.23 B; Annual growth 6%
Imports $1.4 B; US Import share 60%
Best Prospects: engines, turbo aircraft, parts
Healthcare and Beauty : Healthcare and Beauty Nutritional Supplements
Market size $2.3 B; Annual growth 15%
Imports $580 M; US import share 80%
Best Prospects: vitamins
Cosmeceuticals
Market Size $5.7 B; Annual growth 10%
Imports $636 M; US import share 22%
Best Prospects: skincare and men’s products
Information & Communication Technology : Radio Frequency Identification (RFID)
Market Size $346 M;Annual growth 73%
Imports $29 M; US import share 90%
Best prospects: Randamp;D, tags/readers, software
Wireless Networking systems andamp; solutions
Market Size: $445 M; Annual growth 8-10%
Imports $148 M; US import share 70%
Best prospects: Wireless broadband, Wireless Internet Services (WiMax) 3.5 Generation, IP TV Information andamp; Communication Technology
Tourism and Education Services : Tourism and Education Services Travel and Tourism
10 million traveler outbound market, growing at 14% annually
Best prospects: family trips, honeymooners, affluent individual repeat travelers, visitors to 'marquee' destinations
Education
Market Size $104 B; Annual Growth 2%
Best prospects: 4-year colleges, prep schools, short-term business training, short-term English language training
USG Advocacy : USG Advocacy Advocacy
US government goes to bat for U.S. companies
Sole advocacy vs. generic advocacy
Requires registration
Civilian Advocacy
Advocacy Center, USDOC
Covered by WTO government procurement rules
Defense Advocacy
Bureau of Industry and Security, USDOC
Defense projects not covered under WTO
Intellectual Property Rights : Intellectual Property Rights Register your IPR BEFORE you do business in Korea
Korea has a 'first-to-file' system
Reversing a 'registered' trademark in Korea is extremely difficult
IPR Toolkit (www.buyusa.gov/korea)
Use the CS Korea Help Desk
How Can CS Korea Help? : How Can CS Korea Help? We are excited by the prospect of the Korea-U.S. Free Trade Agreement, not only in terms of tariff reduction but in triggering a new trade dynamic – benefiting all ranges of business, all industry sectors, and impacting both Korean and Regional Markets!
CS Korea is ready to offer guidance on the benefits of the FTA once details become available as well as offer full-service customized support
New opportunities; New Market Research; New Means of reaching clients – I invite you to participate
Contact Us : Contact Us Local U.S. Export Assistance Centers
1-800-USA TRADE
www.export.gov/cs
U.S. Commercial Service Korea
John J. Fogarasi
U.S. Embassy Seoul
Phone: (82-2) 397-4535
John.Fogarasi@mail.doc.gov
www.buyusa.gov/korea
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Thank You