KOTRA chief pessimistic about export outlook
By Lee Hyo-sik
Kim Jae-hong, CEO of the Korea Trade-Investment Promotion Agency (KOTRA), speaks during a press conference at a restaurant in Seoul, Wednesday. / Yonhap
Korea will continue to face an uphill battle in bolstering its sagging exports unless China and other emerging economies regain growth momentum, according to the head of the state-run trade promotion body, Wednesday.
Kim Jae-hong, CEO of the Korea Trade-Investment Promotion Agency (KOTRA), said exports will likely shrink by a double-digit figure in February from a year earlier, stressing that Korea needs to diversify its export markets and encourage more small businesses to turn their eyes abroad.
“We estimate that February’s outbound shipments would drop at a double-digit rate,” Kim said Wednesday. “Unfortunately, this downward trend is feared to continue for the foreseeable future.”
In January, Korea’s exports fell 18.5 percent from the same month last year, the steepest decline in more than six years.
Kim citied a slowdown in China and other emerging economies as a major culprit for the country’s sluggish exports.
“Local exporters ship about 58 percent of their goods to China and other developing countries,” he said. “When these nations’ economies slow down, this inevitably wreaks havoc on our exports. In addition, Korean firms have been selling largely low-cost, low-tech industrial products rather than innovative and premium ones. Large companies have led the export drive, while many small and medium-sized enterprises remain on the sideline.”
Kim called on domestic firms to shift focus to the United States and other advanced economies, as well as market more consumer goods and encourage and support more small firms in selling their goods abroad.
“To help bolster the country’s sinking outbound shipments, we have taken all possible measures over the past few months,” he said. “We are running a taskforce to draw up comprehensive support for exporters. We are also in the middle of realigning our manpower to play a more active role in the nationwide export promotion campaign.”
To become the export promotion-focused state agency, KOTRA is in talks with the Ministry of Trade, Industry and Energy and the Ministry of Strategy and Finance about its ongoing organizational reshuffle, he said.
“We will help more companies that are producing premium consumer goods make inroads into foreign markets,” Kim said. “We will extend all possible support to those looking to enter newly emerging markets, such as Iran and Mexico. Korea’s export outlook seems bleak at the moment. But if we work hard, we can make a difference.”