Ministry of Trade, Industry and Energy

Briefing session held in Jakarta to support Korean companies’ regulatory compliance in Indonesian market

Korean Agency for Technology and Standards (KATS) under the Ministry of Trade, Industry and Energy (MOTIE) held a briefing on August 9 in Jakarta, Indonesia, to Korean firms operating in the local Indonesian market to enhance their response capacity and understanding on Indonesia’s technical regulations.   With the world’s fourth largest population, Indonesia is one of Korea’s largest consumer markets where many Korean firms are currently active. However, amid tightening regulations on requirements for halal certification, halal labeling, and standards certification, it is expected that local business challenges will increase for Korean firms in the Indonesian market. To address these issues, the briefing consisted of in-person sessions by regulatory authorities from Indonesia’s Ministry of Industry, state-run halal certification agency (BPJPH), and state-run inspection and certification institution (SUCOFINDO) on technical regulations and recent amendments, followed by a Q&A session. Companies also received briefings on halal certification, TKDN (government policy mandating locally operating companies to use a minimum percentage of Indonesia’s homegrown components), and the Indonesian National Standard (SNI) product certification. Under its FTA TBT one-stop assistance program, KATS currently runs a task force (TF) for local regulatory support in major export destinations to which Korea’s exports are rising but whose technical regulatory information may be difficult to obtain. Through the program, KATS swiftly monitors domestic companies’ business issues to offer tailored consulting services, while also collecting and providing information on regulatory amendments and other relevant changes through networking channels established with local regulatory authorities. Director General Lee Chang-soo, in charge of technical regulatory response, stated that briefing sessions will also be held in China, Vietnam, and India later this year, with aim to help locally operating Korean firms’ technical regulatory compliance and to establish a stable business environment.   date2024-08-09

ROK-US Energy Ministerial Meeting for Clean Energy Cooperation

ROK-US Energy Ministerial Meeting for Clean Energy Cooperation   The Korean Minister of Trade, Industry and Energy Ahn Duk-geun met with the US Secretary of Energy Jennifer Granholm at the ROK-US Energy Ministerial Meeting in Washington, D.C. on the 7th to 8th of August.   The two ministers discussed ways to strengthen cooperation towards reducing carbon emission, achieving energy security and enhancing international coordination in efforts such as decarbonizing the industry and power sectors. There was also a consensus on building a public-private partnership as a means of strengthening bilateral cooperation. They also discussed holding the Ministerial Energy Policy Dialogue and public-private clean energy forum on a regular basis. Since the Inflation Reduction Act (IRA) was signed into law, the two countries have seen an increased level of business-to-business exchange in areas such as batteries, energy storage, hydrogen, and renewable energy. Growing prospects of electrical equipment markets, including ultra-high-voltage transmission systems for expanding renewable energy, such as off-shore wind, also highlight the significant need to continue regular cooperative engagement between the two countries.   Minister Ahn also shared Korea’s views as the 2025 APEC Host to promote carbon-free energy technologies such as nuclear, renewable energy, and hydrogen as a means to expand clean electricity across the region and requested US support. The meeting also covered discussions on sustainable future fuels for industrial decarbonization and international coordination for carbon capture, storage, and removal technologies.   “Strategic and comprehensive clean energy partnership between Korea and the United States builds on our strong US-ROK Alliance and matters more than ever given the importance of building stable clean energy supply chains among like-minded countries. The ironclad ROK-US Alliance contributes to global climate action, stable energy supply chains, and energy security. The bilateral cooperative platform can be a stepping stone to increased business opportunities, increased investment, and, ultimately, global clean energy leadership,” said Minister Ahn.   date2024-08-09

MOTIE lays out roadmap on competitive bidding for offshore wind power distribution

Trade, Industry and Energy Vice Minister Namho Choe chaired a conference with offshore wind power companies on August 8 at the Korea Chamber of Commerce and Industry (KCCI) in Seoul and announced the Offshore Wind Power Competitive Bidding Roadmap (“Roadmap”). A fast-paced follow-up to measures announced last month on invigorating solar power generation across industrial complexes, the Roadmap is the second set of implementation measures under the strategy announced this May on expanding renewable energy distribution and strengthening the supply chain. With the distribution of domestic wind power facility forecast to reach 18.3 GW by 2030 (11th Basic Plan on Electricity Supply and Demand), the situation going forward calls for competitive bidding on large-scale offshore wind power projects. Accordingly, the Government plans to initiate the distribution of offshore wind power in a way that can harmoniously balance the aims to expand the distribution of renewable energy, nurture the industrial ecosystem, and accommodate price competition. Addressing these goals, the key points of the Roadmap are as follows. First, the timing of competitive bidding for wind power projects will move up from its initial window in the fourth quarter (Q4) to the second quarter (Q2) of each year, and the notice of an additional tender will be released in Q4 if needed. From the second half (H2) of 2024 to the first half (H1) of 2026, the Government will launch approximately 7–8 GW worth of offshore wind power tenders during the two-year period. With regard to bid evaluation, the Government will adopt a two-stage process. The first round of evaluation will assess the nonprice attributes to select 120–150 percent of submitted bid quantity and the second round includes price competition based on an evaluation of price attributes. When the first- and second-round scores are added up, the bidder with the highest total score is selected as winner. Furthermore, the Government intends to increase the score allotted for nonprice criteria from the current 40 to 50, as well as incorporating aspects like maintenance, security, and public works as additional evaluation criteria.   Beginning this year, a bid market for floating wind turbine projects will be newly opened alongside the existing one for fixed wind turbine orders. Moreover, in line with the realignment of the renewable portfolio standards (RPS) system, a target ratio on public-sector participation will be proposed to strengthen the role of the public sector. In H1 2025, the Government plans to launch a public-led bid market. Vice Minister Choe expressed anticipation that the Roadmap will help present a stable bid quantity early on, accelerating large-scale investments in offshore wind power and job creation across domestic and overseas firms, while also spurring the establishment of ports and ships and other related infrastructure.    Meanwhile, the Ministry of Trade, Industry and Energy (MOTIE) plans to release a wind power tender for competitive bidding this October, preceded by a tender briefing in September.   date2024-08-08

Trade Minister Cheong’s meeting with NCAPEC on preparations for APEC summit 2025

Minister for Trade Inkyo Cheong met with Monica H. Whaley, president of the U.S.’ National Center for Asia-Pacific Economic Cooperation (NCAPEC), and other NCAPEC members from Google, Airbnb, and Amazon on August 6 in Seoul on the margin of their visit to Korea.  At this meeting, Minister Cheong shared Korea’s preparations for hosting the Asia-Pacific Economic Cooperation (APEC) Economic leaders’ meeting held in 2025, as well as Korea’s plans and major deliverables such as the cooperation of sustainable supply chains and an establishment of artificial intelligence (AI)-based cooperative system within the APEC region.  In addition, he asked NCAPEC to share its knowhow of how it hosted a series of business events such as APEC Business Advisory Council (ABAC) Dialogue with Economic Leaders and the APEC CEO Summit with the Korea Chamber of Commerce and Industry (KCCI) which will host the business events next year. In turn, NCAPEC representatives proposed APEC-level cooperation in establishing digital trade principles and restoring supply chain resilience. Minister Cheong highlighted Korea’s aim to produce tangible outcomes during Korea’s APEC chairmanship in 2025 such as strengthening intraregional business networks through various events for public-private exchanges, and requested NCAPEC to prepare meaningful business events in cooperation with KCCI.   date2024-08-06

Korea to train overseas shipbuilding talent for deployment at K-shipyards

The Ministry of Trade, Industry and Energy (MOTIE) announced that it is opening an Overseas Shipbuilding Manpower Center in Serang, Indonesia, on August 5 to locally train skilled shipbuilding talent through Korean language and technology education in order to employ the educated manpower at Korean shipyards. Initially suggested in March as part of the MOTIE-led K-Shipbuilding Next-Generation Initiative, the proposed measure has culminated into the aforesaid program over five months of consultation between Korea offshore & Shipbuilding Association (KOSHIPA) and Indonesia’s Ministry of Manpower. Korea’s shipbuilding industry is presently riding the waves of opportunity towards new growth, having secured 39.1 million compensated gross tonnage (CGT) worth of orders (as of August 2) and improving the nation’s industrial constitution and management conditions by winning high value-added ship projects. However, the long-term recession and ensuing manpower leakage are acting as headwind to the industry. Accordingly, the Government added 16,000 workers to the production manpower last year by improving the visa and training system, but the industry expects that demand for quality foreign workers will continue for some time. The Overseas Shipbuilding Manpower Center was launched for the purpose of teaching local workers the Korean language and shipbuilding technology for preliminary site execution to enable seamless deployment without retraining in Korea, as well as establishing a stable workforce supply channel and bolstering industrial cooperation between the two countries. Over a three-month period, the first batch of 30-40 trainees will be learning the welding techniques required across Korean shipyards, then apply for the welder qualification and certification program. Meanwhile, they will also study to take the Test of Proficiency in Korean (TOPIK) and be given safety education courses for the prevention of safety accidents. In this process, the Indonesian government is to recruit and educate the trainees and KOSHIPA is to dispatch experts and assist with testing. The Government aims to leverage this pilot project to address areas that need improvement and increase the number of trainees to strengthen the Overseas Shipbuilding Manpower Center’s role, while also establishing additional manpower training centers in other countries. Further plans include institutional support measures, such as streamlining visa procedures and tying in with official development assistance (ODA) via cross-ministerial consultations.   date2024-08-05

Korea’s exports rise 13.9% in July

The Ministry of Trade, Industry and Energy (MOTIE) announced on August 1 that Korea’s exports for July 2024 increased 13.9 percent year-on-year to USD 57.5 billion, the second highest in record for the month. Imports grew 10.5 percent to $53.9 billion and the trade balance stood at a surplus of $3.6 billion. Exports maintained their upward trajectory for the 10th consecutive month.  By item, 11 out of 15 major export items advanced, with the total export value (up 44.0 percent to $15.6 billion) of information technology (IT) items climbing for the ninth consecutive month. Notably, semiconductor exports logged $11.2 billion (up 50.4 percent), their growth rate surpassing the 50 percent mark for the fourth consecutive month. The export of displays (up 2.4 percent to $1.7 billion), computers (up 61.6 percent to $1.2 billion), and wireless communication devices (up 53.6 percent to $1.5 billion) achieved growth for the 12th, seventh, and fifth consecutive month, respectively. Automobile exports (down 9.1 percent to $5.4 billion) were impacted by major carmakers’ summer holidays landing in the month, but automobile parts (up 9.5 percent to $2.2 billion) enjoyed growth, snapping the three-month losing streak. General machinery exports recorded an all-time high for July, moving up 12.5 percent to $4.9 billion and turning to an expansion for the first time in three months. Petroleum products (up 16.7 percent to $4.5 billion) and petrochemicals (up 18.5 percent to $4.2 billion) surged for the fifth and fourth consecutive month, respectively. Meanwhile, bio-health (up 29 percent to $1.2 billion), textiles (up 1.6 percent to $0.9 billion), and home appliances (up 9.4 percent to $0.7 billion) all turned to growth after a month of decline. By region, exports to eight out of nine major destinations experienced growth. Exports to China logged $11.4 billion (up 14.9 percent), the highest in 21 months, and entered the $10 billion thresholds for the fifth consecutive month on the backs of rising exports of semiconductors, wireless communication devices, and other IT items amid the IT industry recovery. As a result, the aggregate China-bound export value through January–July this year recorded $74.8 billion (up 6.7 percent) for Korea, the highest among its export destinations for the period. U.S.-bound July exports also set a fresh record for the month at $10.2 billion (up 9.3 percent), renewing monthly highs for the 12th consecutive month. To ASEAN, exports posted $9.9 billion (up 12.1 percent) as major export items in IT, petroleum products, and petrochemicals met strong demand, advancing for the fourth consecutive month alongside those to India (up 13.4 percent to $1.6 billion). Exports to the Middle East jumped 50.6 percent to $2.2 billion, improving for two straight months. Exports to Japan (up 10.1 percent to $2.6 billion), Latin America (up 31.3 percent to $2.6 billion), and the Commonwealth of Independent States (CIS) (up 4.0 percent to $1.0 billion) all switched to an expansion. As for July imports, those of energy expanded 11.9 percent year-on-year to $10.9 billion, driven by increased shipments of crude oil (up 16.1 percent) and gas (up 23.8 percent). Korea’s accumulated trade balance through January–July expanded $51.2 billion year-on-year, amounting to an all-time high since 2018.   date2024-08-01

Korea elected as inaugural chair of IPEF Crisis Response Network

The Ministry of Trade, Industry and Energy (MOTIE) announced on July 30 that all three of the supply chain bodies under the Indo-Pacific Economic Framework for Prosperity (IPEF)—Supply Chain Council, Crisis Response Network (“CRN”), and Labor Rights Advisory Board—have officially launched and entered the implementation phase, and that Korea has been elected as the inaugural chair of CRN. CRN is the world’s first supply chain emergency response platform introduced by IPEF for seeking joint response measures among the 14 partner countries through emergency meetings in the case of supply chain disruptions. At the request of a single country, an emergency meeting is convened within 15 days to discuss support measures for joint procurement, swift customs procedures, and securing alternative supply chain and transportation routes, and may be elevated to either ministerial or summit level according to need. During non-crisis times, CRN assists programs for strengthening partner countries’ response capacity, such as developing disruption countermeasure strategies, conducting tabletop exercises, and making assessments on partner countries’ emergency response experience and related policies. On July 24, Korea was elected as the CRN’s chair with unanimous consent, indicating that Korea’s experience and policy know-how in supply chain emergency response were highly appraised by partner countries. Moreover, Japan’s election as vice chair places the two countries in a position to take the joint initiative in building a global cooperative system for supply chain management. Minister for Trade Inkyo Cheong stated that CRN is an innovative platform that enables solidarity and cooperation between industrial powers and resource-rich countries.   date2024-07-30

Korea’s retail industry grows 10.5% in H1 2024

The Ministry of Trade, Industry and Energy (MOTIE) announced on July 30 that Korea’s retail industry grew 10.5 percent year-on-year in the first half (H1) of 2024, with offline and online sales advancing 3.4 percent and 17.5 percent, respectively. During H1, offline retail sales steadily expanded across close-proximity convenience stores (up 5.2 percent) and super supermarket (SSM) operators (up 5.6 percent). Sales at hypermarkets (up 0.7 percent) and department stores (up 3.1 percent) likewise increased.  Online retail sales for H1 soared on the backs of various discount promotions and wider range of deliverable items, coupled with the routinization of online purchases for travel, performances, and food products. MOTIE releases monthly retail sales figures based on surveys of 25 major retailers. Thirteen of them are brick-and-mortar retailers: three department store chains, three hypermarket chains, three convenience store chains, and four super supermarket (SSMs) operators. The remaining 12 are online retailers. For the month of June, Korea’s retail industry jumped 11.1 percent year-on-year, with offline and online sales climbing 3.7 percent and 18.4 percent, respectively. The growth is attributed to a higher number of holidays during the month (+2), stronger demand for eating in and buying in smaller quantities within one’s neighborhood. Factors driving online sales include demand for seasonal home appliances and instant/processed food products. By offline retail channel, hypermarket sales rose 2.1 percent in June as sales of food products (up 4.3 percent) and clothing (up 5.2 percent) improved, while those of home appliances/culture (down 3.3 percent) and sports (down 11.9 percent) dropped. Department store sales surged 5 percent overall as foreign designer labels (up 2.3 percent) and household goods (up 14.9 percent) increased, while women’s suits (down 2.6 percent) and men’s clothing (down 0.9 percent) shrank. Convenience stores (up 3.8 percent) enjoyed sales growth across all items, led by beverages/processed food products (up 5.7 percent), instant food products (up 1.7 percent), and tobacco/other (up 2.0 percent). SSM operators showed an uptick of 2.0 percent overall in spite of the fall of nonfood categories (down 3.8 percent), as sales of agriculture, fishery, and livestock products (up 3.3 percent) and processed food products (up 2.1 percent) increased. Online sales spiked 18.4 percent overall, led by strong demand for air conditioners and other seasonal home appliances/electronic devices (up 10.4 percent) amid the early heat wave. Sales of services/other (up 67.5 percent) drove online sales as well, thanks to the continued growth of food products (up 20.1 percent) amid high inflation and high demand for home-cooked meals, fueled by free delivery and e-coupon discounts. Meanwhile, fashion/clothing (down 10.4 percent) and sports (down 8.7 percent) experienced slower sales.   date2024-07-30