The Ministry of Trade, Industry and Energy announced on February 23 that President Yoon Suk-yeol presided the 4th Exports Strategy Meeting, during which Korea’s pan-ministerial strategy for export expansion for 2023 was confirmed.
The Korean government set the nation’s 2023 export target value at USD 685.0 billion (exports totaled approximately $683.9 billion in 2022). In spite of difficult export conditions due to the global economic downturn, the Government’s concerns over prolonged trade deficit and export decline, and firm determination for export growth established the goal target.
To achieve the goal, a pan-ministerial export support budget of KRW 1.5 trillion will be injected into powering 12 new export growth engines through collaboration of 18 different ministries and supporting offices, backed by trade financing of maximum 362.5 trillion won.
The 12 new export growth engines will span across semiconductors, secondary batteries, EVs, high value-added shipbuilding, nuclear power plants, national defense, green industries, edu-tech, smart farming and creative content.
1) Core industries
Secondary batteries: Increase R&D assistance for securing super gap and entering new markets (1 trillion won, until 2030)
EVs: Response to U.S. Inflation Reduction Act (IRA), technology development and demonstration project for securing three core performances (mileage, range, charging speed), nurture new EV markets, including Vietnam and the Philippines.
High value-added ships: Provide financial support with advance payment refund guarantees, localize core LNG vessel technology, develop zero-carbon autonomous vessels
Semiconductors: Increase investment tax credit, provide infrastructure assistance for power and water, support technology development for back-end process of system chips and semiconductors, support training up of 150,000 professional manpower.
Displays: Expand scope of tax support, policy financing worth 900 billion won, step up assistance for innovation R&D of inorganic electroluminescence displays and transparent, automotive, wearable displays.
Steel: Create low carbon steel industry fund for 150 billion won, support eco-friendly technology and investment, etc.
General machinery: Promote robot-friendly environment through support for demonstration and projects, assist market entrance into Middle East and the U.S. in step with their large-scale infrastructure demand.
Petrochemicals: Develop technology for fuel conversion, execute Shaheen Project ($7 billion) and other major projects, support entrance into bio-degradable plastics markets in the EU.
2) Industries involving bid strategies
Nuclear power plants: Push differing, country-specific strategies for Czech Republic and Poland and other projects, and pursue deregulatory measures and streamline export procedures for reactors for export (e.g., APR1000)
Defense: Expand the Korea Defense Industry Trade Support Center (KODITS) and establish a comprehensive bid support system.
Overseas construction & plant: Run a support group for overseas construction bid projects (MOLIT), newly install a plant advisory group (MOTIE), etc.
Environment Industry: Dispatch green industry bid support team revolving around public-private joint green industry export alliance launched in January, increase green policy-based loans (3.5 trillion won).
3) New promising export industries: Agro-fisheries, digital, bio-health
Agricultural products: Save logistics costs by establishing agriculture-specialized export logistics system, expand Hallyu marketing
Fishery products: Nurture strategic export items like sea laver and tuna, support companies’ local market penetration, including export incubation and localization.
Smart farming: Actively support overseas market penetration with smart agriculture fund (20 billion won).
ICT services: Establish support system for all software industry cycles, support the development of AI and services convergence technology.
Creative content: Increase number of overseas bases for exporting creative content, inject policy financing (790 billion won), etc.
Edu-tech: Support expansion of edu-tech soft labs for demonstration projects of products and services.
Pharmaceutical & medical devices: Assist domestic bio companies’ investment plans (app. 2.4 trillion won), push K-Bio vaccine fund investment (500 billion won)
Cosmetics: Assist internal procedures for evaluation of raw ingredients’ safety evaluation to respond to China’s tighter licensing regulations, diversify market to Vietnam and Indonesia, etc.
All ministries will aim to create export drive and synergy through pan-ministerial cooperation across all sectors, including energy, new industries, infrastructure and high-tech, so that recent economic summit diplomacy outcomes can be translated into economic collaboration and export expansion.
For MOTIE, the Ministry of Economy and Finance (MOEF), Ministry of SMEs and Startups (MSS) and other relevant ministries, special focus will be given to nurturing competitive small companies and start-ups to become exporters, as well as strengthening the export assistance role of institutions supporting overseas market entrance of small and medium-sized enterprises (SMEs).
For other ministries like the Ministry of Foreign Affairs (MOFA) and Ministry of Land, Infrastructure and Transport (MOLIT), cooperation network among overseas bases of export assistance institutions will be strengthened, and the Korea Trade-Investment Promotion Agency (KOTRA) will be reinforced in terms of its role as nation’s core export assistance platform.
Along with MOTIE, the Financial Services Commission (FSC), MOEF and MSS will be supporting the financial packages and export partner guarantees for each stage of export and bid process in order to help companies enter bids for high-risk, large-scale projects.
The Ministry of Agriculture, Fisheries and Rural Affairs (MAFRA) and other ministries are called to strengthen their role in supporting marketing and overseas certification process for companies with little export experience by co-hosting overseas exhibitions and providing one-stop assistance.
Meanwhile, the Office for Government Policy Coordination, Korea Customs Service (KCS) and other relevant ministries are to tackle issues regarding “export blind spot” issues by stimulating digital trade and strengthening assistance for services exporters.
For the purpose of achieving the above goals for export growth in 2023, pan-ministerial export assessment meetings will be held together by multiple ministries to review progress of joint projects and to deepen inter-ministerial cooperation.