Ministry of Trade, Industry and Energy

Korea's retail industry grows 13.7% in February

The Ministry of Trade, Industry and Energy (MOTIE) announced on March 26 that Korea’s retail sales for February increased 13.7 percent year-on-year.   Offline sales shot up 11.5 percent along with higher number of working days, and all categories showed growth, led by food products (up 20.8 percent).   Online sales hiked 15.7 percent on the backs of growing demand for Seollal holiday travel packages, products related to graduation and performances and convenience foods and e-coupons.   By item, sales of food products (up 26.7 percent), service/other (up 13.6 percent) and living/home (up 12.8 percent) advanced.   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 SSM operators. The remaining 12 are online retailers.   By offline channel type, sales at hypermarket chains leaped 21.0 percent as a result of inflation and Seollal holiday effect, with growth seen across all items aside from home appliances/culture (down 2.2 percent).   Department store chains gained 7.2 percent in overall sales despite the drop in women’s suit (down 8.1. percent) and household goods (down 2.5 percent), as foreign designer labels (up 6.4 percent) and miscellaneous goods (up 3.3 percent) rose.   Convenience stores advanced 9.4 percent, with strong growth in cost-effective food items like beverages/processed food products (up 11.2 percent) and instant food products (up 8.4 percent). Demand for school supplies and stationery sales boosted sales of all items, including daily necessities (up 16.1 percent) and miscellaneous goods (up 13.7 percent).   SSM operators posted a 12.6 percent jump overall, as agriculture, fishery, and livestock products (up 15.7 percent), processed food products (up 15.0 percent), fresh/prepared foods (up 6.8 percent), daily necessities (up 6.8 percent) and all other items recorded growth.   As for sales per store, hypermarkets (up 22.9 percent), department stores (up 7.2 percent), convenient stores (up 5.1 percent), and SSM operators (up 8.2 percent) all increased.   Online retail sales (up 15.7 percent) contracted in fashion/clothing (down 9.5 percent) and sports (down 4.3 percent) due to inflation and decline in consumer sentiment, but other items enjoyed growth from the Seollal holiday effect and cheap price promotion events.   Holiday gift items, instant food products and bulk convenience food products met robust demand, driving online sales of overall food products (up 36.2 percent). date2024-03-26

Korea to provide up to KRW 255 tln in trade insurance to promote exports

Trade, Industry and Energy Minister Dukgeun Ahn held the fourth public-private joint meeting on export promotion measures on March 25 at the Korea Chamber of Commerce and Industry (KCCI) and led discussions on the measures for strengthening trade insurance support, overseas market competitiveness of small-sized e-mobility, and support for exporting companies’ technical barriers to trade (TBT) response.   The above agenda items were selected as part of a follow-up to the pan-ministerial export promotion strategy established in February for achieving this year’s USD 700 billion export target, incorporating detailed finance, certification, and marketing strategies.   First, the plan is to provide up to an all-time high KRW 255 trillion in trade insurance and drastically improve the terms regarding recipient eligibility and provision method. Automobile, secondary battery, machinery, shipbuilding, petrochemicals, steel, and IT and other major export sectors will be eligible for 136 trillion won in total insurance. Defense, plant, nuclear power, and other energy industries will be eligible to receive up to 26 trillion won, while promising consumer goods like agriculture, fishery and cosmetic products and other Hallyu-leading items will be eligible for a total of 18 trillion won in insurance support. As a means to boost service exports, programs will be rolled out to grant production funding to global over-the-top (OTT) companies in charge of creating K-content. SMEs and middle-market companies in weakened state of financing from persistent high interest rates will be assisted with up to 90 trillion won for relief from funding burdens.   Second, relevant ministries will support overseas market penetration of small e-mobility items, as the market is forecast to grow into a hefty $120 billion market by 2030. Regions with low rates of e-mobility utilization and highly competitive markets can be target markets for tailored strategies. Meanwhile, South Jeolla Province, Gangwon and North Gyeongsang Province are some of the regions in Korea that can be connectively nurtured into an export cluster to establish a shared e-mobility platform for operation, charging, and after-sales services as part of the plan to reinforce the domestic industrial ecosystem.   Third, ministries and related institutions are seeking measures for responding more quickly and systematically to the increasingly complex TBTs to mitigate the burden on exporting firms, such as by improving the information provision service on unnotified and hard-to-find regulations and holding on-site business consultations for one-stop problem solving. date2024-03-26

Korea and EU enter 3rd official negotiating round for bilateral digital trade agreement

The Ministry of Trade, Industry and Energy (MOTIE) announced on March 25 that the third official negotiating round for the Korea-EU Digital Trade Agreement is to be held through March 25-27 in Brussels, Belgium, with approximately 30 persons participating in the two countries’ government delegations.   Having agreed on establishing the bilateral digital trade agreement in accordance with the high standards of the Korea-EU digital trade principles laid down in November 2022 on securing consumer and business confidence, facilitating digital trade, and taking joint response against digital protectionism, the two sides declared the launch of negotiations in October last year, followed by two rounds of official negotiations. This third negotiating round will aim to make headway by establishing the stance of both sides through discussions per each clause and narrowing differences in opinion.   The Korea-EU digital trade agreement is anticipated to set the rules for the digital economy and accelerate digital innovation through the introduction of new trade rules, while enhancing firms’ business competitiveness by expanding Korea’s digital trade network with the EU, the world’s vast economic bloc. date2024-03-25

Korea and Romania discuss wider industrial, trade, and energy cooperation

Trade, Industry and Energy Minister Dukgeun Ahn and Romania’s Economy, Entrepreneurship and Tourism Minister Ștefan-Radu Oprea held the 10th Korea-Romania Industrial Cooperation Committee Meeting on March 25 in Seoul to discuss measures for wider cooperation in trade, investment, industry, and energy.   Launched in 2004, the Committee meeting has been held alternately in the two countries, and the 10th meeting was convened for more in-depth discussions on nuclear energy, defense, and other major bilateral issues.   Noting the two countries’ establishment of diplomatic ties in 1990 and emphasis on automotive parts and steel industry cooperation, Minister Ahn proposed in his opening address that they further the strategic partnership ties established in 2008 by building on their manufacturing industrial cooperation to expand into other areas like industrial technology, nuclear energy, defense, and infrastructure.   In view of the bilateral trade volume having achieved a record high last year, both sides agreed to expand bilateral trade and investment through exchange of trade data and participation in trade show exhibitions. The Korean delegation stated interest in joint research and development in areas like information and communications, chemicals, and bio, and the Romanian delegation introduced Romania’s energy mix policy on expanding nuclear and renewables. The two sides agreed to work together to achieve their shared goal of carbon neutrality and make joint effort towards the global diffusion of the Carbon-Free Energy (CFE) Initiative.   Furthermore, Romania expressed interest in defense cooperation with Korea, to which the Korean delegation highlighted the prospects of creating economic gains through related local investment and technology transfer. date2024-03-25

Korea and Bangladesh discuss measures for wider economic cooperation

Korean government officials and the public-private joint delegation from Bangladesh are seeking measures for wider economic cooperation in trade, investment, and industries on the occasion of the latter's visit to Korea.   Minister for Trade Inkyo Cheong met with Nurul Majid Mahmud Humayun, the Industries Minister of Bangladesh, on March 22 in Seoul to discuss measures to widen economic cooperation by bolstering trade, investment, and industrial ties.   During the talks, Trade Minister Cheong proposed that their textile industries incorporate new added value, while digital, carbon neutrality, and other areas of cooperation be diversified to deepen the Korea-Bangladesh economic cooperation still further, for which he underscored the need for the two countries to enter the Trade and Investment Promotion Framework (TIPF) Agreement as a new platform for economic cooperation.   Moreover, the trade chief shared some of the issues Korean companies experience in Bangladesh, including those concerning visa, duties, customs, and infrastructure and asked that Korean firms operating locally be given assistance in resolving these challenges. Minister Humayun responded that these concerns will be carefully addressed to help stabilize Korean companies’ business management in Bangladesh. date2024-03-22

MOTIE announces “Public-Private Joint Strategy on Overseas Resources Development”

Trade, Industry and Energy Minister Dukgeun Ahn chaired a conference with major overseas resources development companies on March 21 at Lotte Hotel Seoul, where he announced the “Public-Private Joint Strategy on Overseas Resources Development”.   Amid intensifying energy supply chain uncertainties caused by growing geopolitical risks and the global race for dominance over critical resources, the Korean government is seeking to restore the ecosystem for overseas resources development in order to stabilize the supply chain of key resources as a national policy task.   Accordingly, the Ministry of Trade, Industry and Energy (MOTIE) collected opinions from industries, experts, and related ministries in establishing the “Public-Private Joint Strategy on Overseas Resources Development”.   Taking note of past policy outcomes and limitations, the above strategy was established in line with the following three policy aims: invigorating the ecosystem of private-led resources development; strengthening national resources security; and securing policy coherence.   The Government plans to stimulate private-led resources development by increasing financial and tax incentives, launching project tasks for mid-to-long term technology development and talent training, invigorating domestic resources development, strengthening public companies’ support for private firms, and bolstering resources diplomacy with resource-rich countries.   Minister Ahn emphasized that public-private cooperation is of utmost importance in stimulating the ecosystem for overseas resources development, as securing a stable energy resources supply chain is a priority task for economic stability and development of advanced industries. date2024-03-21

Public-private "One Team" gear up to attain KRW 10 tln NPP export target by 2027

Trade, Industry and Energy Vice Minister Namho Choe chaired a meeting on March 21 at K-SURE in Seoul to review prospective nuclear power plant (NPP) equipment export projects, as a follow-up to the ministry’s measures for achieving the KRW 10 trillion in NPP equipment export target by 2027, announced via the 14th public forum held on February 22.   According to the International Atomic Energy Agency (IAEA), 415 NPPs are in operation at present as of March 2024, and demand for NPP equipment is rapidly rising on the backs of the increase in new NPP construction projects and continued operation.   The Korean government established the NPP equipment export stimulation measures in March last year, rendering support from multiple angles, such as expanding the budget for NPP export assistance and establishing trade centers across core export destinations.   The efforts have added up to striking a total of 4.9 trillion won worth of 105 export contracts over the last 20 months since President Yoon Suk Yeol took office, at least six-fold the amount exported through 2017-2021. While winning mega scale projects like the 3 trillion won El Daaba NPP Project in Egypt and 260 billion won tritium removal facility in Romania, Korea has also been exporting single unit equipment, operation and maintenance service, and small modular reactor (SMR) design, which amount to approximately 750 billion won.   To leverage this momentum for expansion, Korea’s public and private sectors have come together to join efforts in achieving the 5 trillion and 10 trillion won export targets for 2024 and 2027, respectively.   Vice Minister Choe stated that the Yoon administration’s initiative for normalizing nuclear policies and strong resolution towards NPP export, coupled with close public-private cooperation, have driven NPP exports over the 4 trillion won mark, and asked that “the public and private sectors join hands as ‘one team’ with strong resolve to reach the 10 trillion NPP export target for 2027.” date2024-03-21

MOTIE to support groundbreaking for cutting-edge memory chip fab slated for March 2025

Trade, Industry and Energy Minister Dukgeun Ahn, on March 21, visited SK Hynix’s Yongin Semiconductor Cluster, a pillar of the semiconductor mega cluster plan announced during the public forum in January.   Approximately 35 percent of Fab 1 has been completed so far and site renovation is in smooth progress. By 2046, over KRW 120 trillion in investment will be poured to complete Fabs 1 through 4, and construction of Fab 1’s production line will commence in March next year. Once completed, the infrastructure will rank as the world’s largest three-story fab.   Having launched an electrical power supply task force in February this year to support the completion of cluster infrastructure, MOTIE plans to form another task force by March to steer the establishment of the high-tech specialization cluster for chips and other advanced industries.   Amid increasing demand for AI chips and high bandwidth memory (HBM), the ministry will aim to swiftly establish a comprehensive strategy for dominance in the AI chip market and devise measures for strengthening chip equipment competitiveness within the first half of this year.   MOTIE also plans to push forward the prefeasibility study for minifab projects in the Yongin testbed and inject policy funding to competent fabless and MPE (materials, parts, equipment) companies. date2024-03-21