INTERVIEW German firms in Korea in need of reliable renewable energy

Korean-German Chamber of Commerce and Industry (KGCCI) President and CEO Martin Henkelmann / Courtesy of KGCCI

Looking back on the three years and seven months he spent as president and CEO of the Korean-German Chamber of Commerce and Industry (KGCCI), Martin Henkelmann said that he was impressed by Korea's "ppali-ppali" mentality in all fields of business and administration.

In terms of following the global trend of energy transition, however, Korea does not seem to live up to its culture of prioritizing swiftness.

During an interview before his departure to the Middle East next month to lead the German Emirati Joint Council for Industry and Commerce, the KGCCI CEO mentioned the insufficient availability of reliable renewable energy as one of the pressing concerns facing German companies in Korea.

"German companies are requested from their headquarters to reduce their carbon dioxide footprint globally and they see the lack of reliable and sufficient renewable energy in Korea," he told The Korea Times.

"More ambitious steps to advance South Korea's energy transition would be helpful."

In May 2021, the lawyer was appointed as the KGCCI president during the COVID-19 pandemic after leading the German chambers of commerce in the Philippines and Tunisia.

Under almost four years of his leadership, the second-largest foreign chamber of commerce in Korea promoted sustainability and innovation as core components of the bilateral business relationship between Korea and Germany.

After being selected as a secretariat of the Korean-German Energy Partnership in June 2021, the KGCCI hosted conferences and working-level talks, providing a platform for leaders and experts to discuss and share eco-friendly practices.

"While German and Korean companies are already leading the way in green technology and innovative solutions, there is great potential to deepen these partnerships through more unified policies that support sustainable trade, energy transition and decarbonization on a bilateral and on an international level," Henkelmann said.

"By jointly fostering innovation and creating an enabling environment for green initiatives, Korea and Germany can not only achieve their sustainability goals but also a global benchmark for economic growth aligned with environmental responsibility."

Based on an optimistic outlook about Korea's transition to the use of green energy, the outgoing CEO noted that sustainability and climate action are foremost trends and developments that will continue to shape the Korean-German business landscape.

"With the ambitious net-zero goals, both Korea and Germany are investing in green technologies like hydrogen, offshore wind energy and other renewable solutions, setting the stage for deeper collaboration," he said.

Henkelmann also proposed the implementation of educational exchange and vocational training similar to Germany's "Ausbildung" as a solution to the growing shortage of skilled employees, which has had increasingly negative impacts on businesses.

"Our Ausbildung vocational program has been training over 600 young professionals in a dual vocational training system with major German automotive brands," he said.

"By fostering strong relationships between businesses and educational institutions, we prepare future employees while addressing labor market demands."

Ambiguous and inconsistent application of labor, tax and customs regulations were mentioned as other significant issues distressing German companies here, just as many foreign businesspeople in Korea have complained about this.

"German companies in Korea have made remarkable strides. However, they also encounter challenges," Henkelmann said.

The Korean-German Chamber of Commerce and Industry's (KGCCI) office building in Jongno District, Seoul / Courtesy of KGCCI

Memories of Korea

The KGCCI CEO picked the organization of meaningful business gatherings during the Korea visits of German Federal President Frank-Walter Steinmeier in 2022 and Minister for Economic Affairs and Climate Action Robert Habeck in April as the highlights among the hundreds of business-to-business meetings between Korean and German companies during his term.

Describing the interaction of Korean and German companies with three "Cs," he said that they compete, collaborate and complement each other.

"When it comes to the Korean-German business relations, the commonalities and the similarities of challenges are much more dominant than the geographic distance between the countries might indicate," he said.

"I sincerely hope that the business ties between Korean, German and European companies will continue to grow stronger and tighter in the coming years."

The relocation of the KGCCI's office to right next to Cheong Wa Dae, the former presidential office, in Jongno District in April was another major event during his term.

Since its office moved to Hannam-dong in 1998 from Samsung Building in Jung District, where it opened its first office in 1981, the chamber has grown in Yongsan District for nearly three decades.

Henkelmann emphasized that the larger office space enabled the KGCCI to expand its services.

Advice for successor

The outgoing CEO hoped to see progress in the modernization of the Korea-European Union Free Trade Agreement (FTA) under his successor's leadership.

"In a time when the international rules-based order is challenged, a Korea-EU FTA 2.0 would be a strong signal," he said.

"There is much potential in boldly modernizing the current agreement, which has been so beneficial for both sides over the past 13 years. Meanwhile, it would be helpful if both sides would apply the rules and regulations in the FTA with goodwill when it comes to the recognition of standards and certifications."

He added that his successor will position Korea as a central platform and innovation hub for economic collaboration between Germany and the Asia-Pacific region by leading the biennial Asia-Pacific Conference of German Business, which will take place in Korea in 2026 following this year's conference held in India.