This study aims to examine the prospects for the European market in achieving Korea’s goal of a 10 billion dollar-trade volume, and to provide an adequate export expansion strategy.
According to an observation of 1973 trade figures by region, three-fourths of the total trade was concentrated on the United States and Japan alone (36% for US, 39% for Japan). About 10% was concentrated on Europe, and the remaining 15% on other developed and developing countries. Export for Europe only remains around 10 percent of its total volume, showing the narrow range of target countries. In addition, exports are comprised of ten major commodities, signifying the limited simplicity of the market.
By signing a free trade agreement with remaining member countries of the European Free Trade Association (EFTA), the extended ECC has helped minimize intra-regional trade flow by completely abolishing tariffs for countries within the region since 1980. At present, it is being implemented as part of a scheme to increasing trade flow with developing countries, and is exempting tariffs on imports to a fixed limit for individual exporting countries. Asides from a small number of items, including fabric and apparel, Korea still has more items that fall short of the limit. In this sense, there still seems to be plenty of room to diversify export items and take full advantage of the preferential duty. Trade restrictions on fabric and apparel among the European non-tariff barriers are gaining particular attention as a big obstacle in export expansion, but will be changed with new rounds of trade liberalization negotiations. However, there is still a need to address this issue in the meantime by increasing the export on non-quota export items.
If the total goal for export to Europe is set at about $2 billion in 1981, total volume needs to increase by 23% since the actual volume in 1973 stands at $380 million. In order to designate the promising items for European export in 1981, this study estimated the trade volumes of 26 major commodities by taking the following factors into consideration and coming up with 68 major items: import trends in EEC-EFTA; major export items in European export of Japan, Taiwan, Hong Kong, Singapore; the Commerce-Industry Ministry’s 10 Billion-Dollar Export Plan; and major export items of 1972. As a result, export of products from the heavy and chemical, electronic industries are expected to increase drastically through the development of the heavy and chemical industry. As some commodities still have a quota restriction and a high level of market entry, export for commodities such as textiles are expected to show a lower rate of increase.
Obstacles blocking the promotion of export to Europe can be classified into internal and external factors. External factors include increased amount of intra-regional trade flow in EEC-EFTA; reinforced NTBs in European countries; problems on item delivery and transaction; small-scale, complex and diverse product demands. Major internal factors include a lack of understanding on the European market; inadequate supplying and transporting abilities, and a lack of export inspection. Based on these findings, the study identified problems on the 68 designated items. The study conducted a thorough examination for each item, and made a thorough analysis based on the Standard International Trade Classification (SITC), suggesting five major comprehensive measures.
수출 100억불 목표와 구주시장 전망(Korea’s goal of 10 billion dollar-trade volume and prospects for the European market)
대구주 수출확대전략(Strategies for export expansion)
|Series Title; No||연구보고서 / 제74-03권|
|Subject Country||South Korea(Asia and Pacific)|
|Subject||Economy < Trade|
|Holding||KDI; KDI School|