SEOUL, KOREA- The creative economy propelled by the Park Geun-hye administration can be achieved though tailor-made, strategy-based R&D, a senior government official said.
In an interview with Korea IT Times, Hwang Byung-soh, the director of the Trade Promotion Division of the Ministry of Trade, Industry & Energy, said, "Tailor-made strategy and reversed process are the key methods to realize the creative economy in the trade field.”
"In the past, all economic policies were mapped out under the basic principle that producing good products and selling them well was the most important factor. Under the current era of global competition, however, such a simple logic does not work well in overseas markets. Before selling goods, we have to consider elaborate targets such as a place to sell, how to produce goods, and concrete technology that needs to be adopted."
He stressed, "We should not blindly concentrate on making good products. We should set detailed targets such as the middle class or low-income bracket, and focus on their consumption patterns. In other words, we should map out tailor-made strategies first and then make R&D investments. We need to progress the process of corporate activities in a reversed manner.
"Using a creative strategy that enables Korean-made goods to survive the overseas market with a relatively small amount of technology is the thought behind the creative economy propelled by the Trade Promotion Division and the Ministry of Trade, Industry & Energy."
World-class Korean products
Noting that the ministry has announced the list of world-class Korean products annually since 2001, Hwang said, "Over the past 12 years, the number of world-class Korean products and the number of Korean companies that produced these goods have increased significantly.”
"For instance, the number of items designated as world-class Korean products soared from 120 in 2001 to 634 in 2012, and that of the companies rose from 140 to 710 during the corresponding period. The annual average export increase rate of the designated products also stood at 13 percent during the 2007~2010 period, far exceeding Korea's annual export growth rate of 8.4 percent," he said.
World-class Korean products are goods that rank among the top five in terms of global market share at present or next-generation products with high potential of advancing into the top five in the global market within five years. The products are designated annually by the Korean government to diversify and upgrade Korean export products.
"Over the past 12 years, 28 items, including a memory semiconductor, TFT-LCD, laser marker, polyester LM fiber and PDP, have steadily held a position honorably on the list. At present, products in the medical instrument and bio fields are steadily emerging as the world-class Korean products," said Hwang.
Exhibition is the flower of overseas marketing
As of 2012, a total of 634 products were designated as the world-class Korean products. Of the total, 405 items or 63.9 percent were produced by small and medium-sized enterprises (SMEs).
The number of SMEs that produced the world-class Korean products dropped from 414 (64.1% of the total) in 2009 to 386 (62.4%) in 2010, and further to 392(59.5%) in 2011, however, they rose again to 431(60.7%) in 2012.
Commenting that large companies can survive the global market by themselves, he said of small and medium sized enterprises (SME), "However, SMEs can only survive overseas markets when they have competitiveness in the TPM sectors - technology, production and marketing. Unfortunately, however, some 70~80 percent of Korean SMEs go bankrupt by failing to tide over the wall of marketing."
"In fact, the government spent an enormous amount of its budget for R&D activities, but allotted only a very slight portion for marketing activities. Accordingly, SMEs should actively utilize overseas trade offices of KOTRA to explore their overseas sales routes," he said.
"Related to this, the Trade Promotion Division is moving to extend tailor-made supports for SMEs according to their size, ability, and competitiveness to help them enhance export competitive edge and grow as a globally specialized firm," said Hwang.
Explaining that the three key components of overseas marketing assistance are exhibition, trade missions, and consultation meetings, he said, "Most of all, exhibition is the flower of marketing. As a result, the division plans to hold the world-class Korean product exhibitions periodically in promising overseas markets in order to systematically publicize such products and connect strictly selected foreign buyers with owners of Korean SMEs through KOTRA trade offices around the world."
