Korea urged to adopt China exit strategy amid hegemonic war

[Viet]

Container ships dock in Korea's southeastern port city of Busan in this undated file photo. Yonhap

By Lee Min-hyung

Korean companies are on track to reduce reliance on China and increase investment in other Asian markets, in attempts to minimize potential losses from the escalating hegemonic struggle between the U.S. and the world's second-largest economy.

Industry watchers and experts said Korean firms have no choice but to adopt a long-term exit strategy from China and gradually cut huge export reliance on the country, as the global hegemonic conflict is showing little sign of abating as Beijing moves toward a closed economy.

Recent data from Seoul's trade ministry also showed that the number of Korean firms that established new branches in China fell by 12.1 percent to 87 during the first half of this year from the previous year. The figure in the Japanese market soared to 118 during the same period.

This marked the first time since 1989 that the number in Japan outpaced that of China.

"China and Hong Kong account for 33 percent of Korea's total exports, which far exceeds the global average of 15 percent," said Kim Dae-jong, professor of business administration at Sejong University.

"It is natural for more Korean firms to turn to other Asian markets such as Japan and Vietnam as China's recent political gesture displays an apparent sign of its return to the closed economy. Big Korean conglomerates, including Shinsegae and Lotte, also withdrew their retail businesses there, and smaller firms also have fewer incentives to expand there."

It is high time for Korea to reshape its export strategy and focus on other Asian markets, according to the professor, as China is unlikely to shift its political stance any time soon.

Kim Moon-tae, head of an industry policy division at the Korea Chamber of Commerce and Industry, said fewer Korean firms will choose to increase investment in China, as they have witnessed escalating management uncertainties in China after its COVID-19 lockdowns.

"Even after the end of the pandemic, China is moving to challenge U.S. hegemony," he said. "It's not just Korean firms adopting an exit strategy there. Other foreign firms are also taking a similar strategy and choosing other alternatives in places such as Hong Kong, Singapore and Japan."

As the U.S. introduces stricter rules against products made in China, a number of Korean big tech conglomerates cannot increase their investment there, he pointed out.

"For now, we do not have any other options but to look for other Asian markets," he said. "For instance, more Korean firms appear to be seeking new opportunities in Japan, jumping on the recent thawing of political tension between Seoul and Tokyo."

Korea urged to adopt China exit strategy amid hegemonic war

Korean companies are on track to reduce reliance on China and increase investment in other Asian markets, in attempts to minimize potential losses from the escalating hegemonic struggle between the U.S. and the world's second-largest economy.

m.koreatimes.co.kr

 

[Dalit]

Urged by who? Doesn't South Korea and Japan have a very dodgy past?

Other foreign firms are also taking a similar strategy and choosing other alternatives in places such as Hong Kong, Singapore and Japan."

LOL as if Hong Kong isn't China.

 

[MajesticPug]

Urged by who? Doesn't South Korea and Japan have a very dodgy past?

Other foreign firms are also taking a similar strategy and choosing other alternatives in places such as Hong Kong, Singapore and Japan."

LOL as if Hong Kong isn't China.

Urged by their master. The same goes for Germany and Vietnam.

 

[Stranagor]

Container ships dock in Korea's southeastern port city of Busan in this undated file photo. Yonhap

By Lee Min-hyung

Korean companies are on track to reduce reliance on China and increase investment in other Asian markets, in attempts to minimize potential losses from the escalating hegemonic struggle between the U.S. and the world's second-largest economy.

Industry watchers and experts said Korean firms have no choice but to adopt a long-term exit strategy from China and gradually cut huge export reliance on the country, as the global hegemonic conflict is showing little sign of abating as Beijing moves toward a closed economy.

Recent data from Seoul's trade ministry also showed that the number of Korean firms that established new branches in China fell by 12.1 percent to 87 during the first half of this year from the previous year. The figure in the Japanese market soared to 118 during the same period.

This marked the first time since 1989 that the number in Japan outpaced that of China.

"China and Hong Kong account for 33 percent of Korea's total exports, which far exceeds the global average of 15 percent," said Kim Dae-jong, professor of business administration at Sejong University.

"It is natural for more Korean firms to turn to other Asian markets such as Japan and Vietnam as China's recent political gesture displays an apparent sign of its return to the closed economy. Big Korean conglomerates, including Shinsegae and Lotte, also withdrew their retail businesses there, and smaller firms also have fewer incentives to expand there."

It is high time for Korea to reshape its export strategy and focus on other Asian markets, according to the professor, as China is unlikely to shift its political stance any time soon.

Kim Moon-tae, head of an industry policy division at the Korea Chamber of Commerce and Industry, said fewer Korean firms will choose to increase investment in China, as they have witnessed escalating management uncertainties in China after its COVID-19 lockdowns.

"Even after the end of the pandemic, China is moving to challenge U.S. hegemony," he said. "It's not just Korean firms adopting an exit strategy there. Other foreign firms are also taking a similar strategy and choosing other alternatives in places such as Hong Kong, Singapore and Japan."

As the U.S. introduces stricter rules against products made in China, a number of Korean big tech conglomerates cannot increase their investment there, he pointed out.

"For now, we do not have any other options but to look for other Asian markets," he said. "For instance, more Korean firms appear to be seeking new opportunities in Japan, jumping on the recent thawing of political tension between Seoul and Tokyo."

Korea urged to adopt China exit strategy amid hegemonic war

Korean companies are on track to reduce reliance on China and increase investment in other Asian markets, in attempts to minimize potential losses from the escalating hegemonic struggle between the U.S. and the world's second-largest economy.

m.koreatimes.co.kr

RU-NK-CN romance expediates the de-risking process.

 

[Menthol]

"It is natural for more Korean firms to turn to other Asian markets such as Japan and Vietnam as China's recent political gesture displays an apparent sign of its return to the closed economy.

Closed Economy?

From what I know China is increasing the economy and trade cooperation worldwide.


South Korea reduces their investment in China because they unable to compete with the local business.

And it's better to invest somewhere else that South Korea still have advantages over the local.


Big Korean conglomerates, including Shinsegae and Lotte, also withdrew their retail businesses there, and smaller firms also have fewer incentives to expand there."

Lotte was involved in the military and security scandal with a country who has a bad reputation for invading and destroying many countries.

Lotte lost billions of USD because of it.

What an evil and stupid company.

 

[Haldorss]

This is all ok, it expands domestic market demand in China.

 

[Viet]

"It is natural for more Korean firms to turn to other Asian markets such as Japan and Vietnam as China's recent political gesture displays an apparent sign of its return to the closed economy.

Closed Economy?

From what I know China is increasing the economy and trade cooperation worldwide.


South Korea reduces their investment in China because they unable to compete with the local business.

And it's better to invest somewhere else that South Korea still have advantages over the local.


Big Korean conglomerates, including Shinsegae and Lotte, also withdrew their retail businesses there, and smaller firms also have fewer incentives to expand there."

Lotte was involved in the military and security scandal with a country who has a bad reputation for invading and destroying many countries.

Lotte lost billions of USD because of it.

What an evil and stupid company.

“Closed economy” means Chinese prefer Chinese products. They shun Korean, Japan and other products. Chinese buy let’s say Byd cars, no more BMW cars. That’s the trend we see since couple of years and it’s only getting worse.

 

[etylo]

it's all OK with China, South Korean, Japanese, German and French companies can all get out China and stop selling their products there. These countries have made enough money from Chinese markets. Now, these countries' products can't compete with Chinese domestic ones, these hypocrites are crying baby of unfair, just disgusting.

 

[Menthol]

“Closed economy” means Chinese prefer Chinese products. They shun Korean, Japan and other products. Chinese buy let’s say Byd cars, no more BMW cars. That’s the trend we see since couple of years and it’s only getting worse.

Not really.

The trend is because Chinese product is getting better in design, features, and quality.

But it doesn't mean foreign brands will just sit idle and not improve.

 

[Viet]

Not really.

The trend is because Chinese product is getting better in design, features, and quality.

But it doesn't mean foreign brands will just sit idle and not improve.

You don’t understand. China is heading self sufficiency. Ccp pushing hard that goal. Foreign brands have no future in China. Sooner than later they will leave. Imports into China will decrease to a minimum level. That’s not new though.
Hundred years ago, the British had nothing to sell Chinese wanted to buy. So they sold opium.

Korea going elsewhere is a natural thing. just a matter Vietnam will become the largest importer in the region.

 

[OIO]

You don’t understand. China is heading self sufficiency. Ccp pushing hard that goal. Foreign brands have no future in China. Sooner than later they will leave. Imports into China will decrease to a minimum level. That’s not new though.
Hundred years ago, the British had nothing to sell Chinese wanted to buy. So they sold opium.

Korea going elsewhere is a natural thing. just a matter Vietnam will become the largest importer in the region.

China is forced to do so. Semiconductor chips used to be the category that China imported the most.

 

[Menthol]

You don’t understand. China is heading self sufficiency. Ccp pushing hard that goal. Foreign brands have no future in China. Sooner than later they will leave. Imports into China will decrease to a minimum level. That’s not new though.
Hundred years ago, the British had nothing to sell Chinese wanted to buy. So they sold opium.

Korea going elsewhere is a natural thing. just a matter Vietnam will become the largest importer in the region.

To encounter the day if the West decided to sanction the whole China.

China will never become close to the USA (West in general) as Japan and South Korea.

The reason is because of the size of China.

A friend, but not a friend.

What happened with the relationship between USA and China today is already being predicted decades ago.


But before the day happens, it's better to keep maintaining a good relationship and trading as long as possible.

China is forced to do so. Semiconductor chips used to be the category that China imported the most.

Semiconductor chips are a must.

It's the building block of future tech.

Even EU is pursuing it, and wants to become a major competitor to USA.

 

[tower9]

“Closed economy” means Chinese prefer Chinese products. They shun Korean, Japan and other products. Chinese buy let’s say Byd cars, no more BMW cars. That’s the trend we see since couple of years and it’s only getting worse.

No, that just means a competitive domestic industry. The closed economy verbiage is obviously just a lot of cope. The reality is that S Korea and China compete in many industries and before, SK was ahead by a big margin and had an advantage which creates more compatibility between the two economies. But now China is a major competitor and even pulling ahead of SK in many industries so combined with the geopolitical situation, South Korean companies’ positions in the Chinese market is no longer tenable. This doesn’t mean that China is closing its economy, it actually still has the widest variety of international brands in its market compared to anywhere else, it just means Korea can no longer compete. Korean companies are being drowned in the competition in China and this is a massive wake up call.

 

[retaxis]

America of course turned against China whether its an ally or not simply because its economic might is challenging and soon eclipsing the US. US likes to be dictator of the world and invade countries when they feel like and sanction/starve other countries. Thankfully US is soon to be majority non white and most whites are LGBT sissys too so its going to be a new South Africa with a disastrous economy and massive debt. China on the other hand relies on hard work, smarts, AI technology and robotics to surge ahead. 1 Chinese works as hard as 4 Americans and there are 4x as many Chinese so China should be one day in the future soon as China climbs up and US falls down, China will be a dozen times larger than US, just like US was a dozen times larger when majority white and Chinese were majority illiterate farm workers in the 60s.

 

[Menthol]

No, that just means a competitive domestic industry. The closed economy verbiage is obviously just a lot of cope. The reality is that S Korea and China compete in many industries and before, SK was ahead by a big margin and had an advantage which creates more compatibility between the two economies. But now China is a major competitor and even pulling ahead of SK in many industries so combined with the geopolitical situation, South Korean companies’ positions in the Chinese market is no longer tenable. This doesn’t mean that China is closing its economy, it actually still has the widest variety of international brands in its market compared to anywhere else, it just means Korea can no longer compete. Korean companies are being drowned in the competition in China and this is a massive wake up call.

Chinese market is the hardest in the world.

Not just for foreign companies, but also for local companies as well, and it's even harder for the locals.

Foreign companies are in a better position, because they have a home base (their country), that they have already conquered.

And foreign companies also have longer experience and more money than the local.

If foreign companies are complaining, I can imagine what local companies do, maybe crying like babies.


1.4 billion people in one big market, free market for all, competing and killing each other in one giant arena.

But in this kind of brutal market, great champions are born.

Chinese companies are no kidding. If foreign companies are complaining about them, that is not a joke.


A big market like China tends to have a faster cycle, no wonder if Chinese product evolved faster than others.

A big market can also bring the cost down significantly.

I can't blame China, not even to call them cheating, I even feel sorry for them, but that is the natural result of a big market.


Foreign country should use China for their advantages to conquer the world.

South Korean and Japanese companies are actually the lucky ones, because they are closer to China than the others.

But they are stupid for not using China for their own advantages.