'Hallyu' driving up cosmetics exports

By Yoon Ja-young

Exports of Korean cosmetics are increasing steeply on the popularity of the country’s pop culture abroad.

According to the Korea Customs Service, the country’s exports of cosmetics totaled $2.5 billion last year, up 53.1 percent from the previous year.

Exports have been growing sharply, marking a 350 percent increase from 2011 when they stood at $698 million.

This year is no exception, with shipments in the first quarter recorded $710 million, up 21.9 percent from a year ago.

“On top of the continuing popularity of Korea’s cultural products such as films, music and TV dramas, the strong competitive edge of the cosmetics brands themselves seems to be driving the exports,” the customs office noted in a media release.

China was the biggest importer of Korean cosmetics at $1 billion last year, or 40.6 percent of the total. Hong Kong followed, taking 24.8 percent, while the United States took 8.5 percent and Japan 4.6 percent.

The customs office expects that exports to China may increase further as the tariffs on goods valued 100 yuan (17,880 won) or more will be lowered from 50 percent to 32.9 percent following a tax revision on e-commerce.

Korea exported cosmetics to 131 countries last year, up from 118 in 2011. Destinations also included Central Asia and Africa. Basic cosmetics such as toner, lotion, essence and eye cream made up half of the exports. Cosmetics for makeup accounted for 9.9 percent.

Exports through e-commerce are also rising steeply, marking $19 million last year. While that is only 0.8 percent of the total, it is a 5,158-fold increase from 2011.

The customs office picked the global economic slowdown and China as potential risks this year. China has shifted policy recently to nurture domestic companies. It also strengthened regulation on imported cosmetics. “The support for small- and medium-sized firms following the establishment of the global healthcare fund as well as the introduction of a regulation-free zone are expected to work positively for Korea’s cosmetics exports,” it added.