Electronics

Several departments of the South Korean government jointly released the "Strategy for Enhancing Export Competitiveness" recently, which greatly enhances the government's financing support for the export of international trade enterprises, focuses on controlling the three major risk factors of international trade, and at the same time increases the policy support for the research and development of the main export industries, to Ensure the leading position of core technology.

According to the latest data from the Korean Ministry of Industry, Trade and Energy, South Korea’s monthly trade deficit in August reached US$9.47 billion, setting a record high in the 66-year history of relevant statistics. Affected by high international energy prices pushing up import costs, South Korea's imports surged 28.2% year-on-year in August; exports were dragged down by weakening global demand for semiconductors, falling prices and the high base effect of last year's exports, with an increase of only 6.6% in August. South Korea's international trade has maintained a deficit for five consecutive months, which is very rare in historical data.

In order to properly cope with the current difficulties encountered by exports, the Ministry of Industry, Trade and Energy of the Republic of Korea, together with the Ministry of Planning and Finance, the Ministry of Small and Medium Venture Enterprises, the Ministry of Oceans and Fisheries, and the Customs Service, jointly issued the "Strategy for Enhancing Export Competitiveness".

Financial support is at the heart of this strategy. The South Korean government will increase the annual limit of trade insurance coverage to ease the difficulties encountered by exporters in financing. The government will provide trade financial support of up to 351 trillion won. In order to ease the burden on companies from rising raw material prices and a sharp drop in the exchange rate, the government asked Hyundai Merchant Marine (HMM), South Korea's largest ocean shipping company, to implement dual currency settlements in the US dollar and the Korean won for imported goods from September to the end of the year. When US dollar-denominated shipping is settled in Korean won, a fixed exchange rate of 1 US dollar to 1,186.65 Korean won will be applied.

Small and medium-sized enterprises are the focus of this export support policy. First, the international trade insurance coverage for small and medium-sized enterprises will be greatly expanded from the original 5 billion won to 7 billion won for small and medium-sized enterprises and 10 billion won for medium-sized enterprises. Second, in the second half of the year, the government will provide additional support for the logistics costs of 750 small and medium-sized exporting companies, and provide 60 billion won in special low-interest financing to small and medium-sized enterprises with operating difficulties. In addition, the government will support the cost of obtaining overseas certification for small and medium-sized enterprises, and will hold a large-scale online and offline (O2O) export fair "Boom up Export to Korea" in November this year.

At the same time, the South Korean government regards the decline in exports to China, the decline in semiconductor prices and the skyrocketing energy prices as the three major risks facing South Korea's exports, and strengthens control and response. Specifically, in order to restore the vitality of exports to China, the government will strive to promote the integration and integration of information and communication technologies, and deepen cooperation in the strategic fields of new materials, key components, technical equipment, and service industries that China and South Korea are vigorously developing. In addition, the government provides support for the export of green industries such as smart cities and renewable energy in combination with China's "dual carbon" policy. Taking the 30th anniversary of the establishment of diplomatic relations between China and South Korea as an opportunity, the two countries will hold the China-ROK Industry and Trade Ministers' Meeting in the second half of the year and hold the China-ROK Economic Ministers' Meeting on a regular basis.

In terms of semiconductors, the government will fully support corporate investment, cultivate 150,000 talents within 10 years, and strengthen support for system semiconductor leading technologies. Targeting fabless (semiconductor design) and material and component companies, support their participation in global exhibitions and hold business meetings to strengthen local marketing. The government will also expand export credit guarantees for small and medium-sized international trade companies in semiconductor raw materials, components, and equipment, and expand short-term international trade financial support such as export insurance concessions.

In terms of energy, the government plans to replace the skyrocketing price of liquefied natural gas with other fuels such as oil and biofuels to reduce energy imports. In order to improve energy efficiency, the government will also discuss plans to add energy efficiency investments and commercialized facilities as "new growth, original technology tax reduction targets".

In terms of ensuring the leading position of the main export industries, as of 2026, the Korean government will provide about 3.7 trillion won in research and development support for industries such as green and unmanned ships, new energy vehicles, and system chips, and strive to train 140,000 people by 2026. professional.

"Exports have always been a solid pillar of South Korea's economic growth, and South Korea will strive to make this export competitiveness enhancement strategy contribute to overcoming the recent domestic and foreign crisis, and I hope the government and the public can make concerted efforts," said Lee Changyang, Minister of Trade, Industry and Energy of the Republic of Korea. .