Republic of Korea

Republic of Korea

EU Gateway to Korea

EU Gateway | Business Avenues smoothed the path [1] for hundreds of European companies in five pivotal sectors — Green Energy Technologies, Healthcare & Medical Technologies, Environment & Water Technologies, Organic Food & Beverage and Contemporary European Design — to meet the right contacts and set up permanent operations in the Republic of Korea.

The 18 business missions organised by the Programme meant European companies could gain valuable insights into local industry trends and set foot or further consolidate their businesses in a foreign market.

With the EU-South Korea Free Trade Agreement [2] in place since 2011, the two economic giants have tirelessly worked to eliminate tariffs and increase market liberalisation, allowing businesses to freely collaborate and set up long-lasting trade relationships.

The business missions gathered over 3400 expressions of interest from companies from across all 27 EU Member States.

784 European companies took part in the EU-funded missions to substantial success. The business exhibitions drew in massive crowds of potential clients and partners — 9100 representatives from local companies visited the European product exhibitions. The invite-only networking events organised by the EU Delegation in Seoul also drew in over 2000 guests, allowing for more exclusive one-on-one conversations happening on the spot. Over 7000 business meetings were pre-arranged by the Programme before the start of the mission weeks, which contributed to generate the nearly 9000 B2B meetings deemed useful by the participating companies.

After the first 4 years of EU-funded business missions to Seoul, more than 1400 jobs were created in Europe following the growing demands from the Republic of Korea. In the same period, between 2016 and 2019, 82% of the companies shared they either established long-lasting business collaborations or expected to do so in the future, and 29.5% of the respondents to our survey declared an increase in turnover in the target market within one year from the exhibition. A second survey records that 91% of the participating companies improved their understanding of the target market, thanks to the Programme.

 

Green Energy Technologies [3]

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The Republic of Korea aspires to be the world’s 5th largest renewable energy powerhouse by 2035. The nation’s lack of natural resources has pushed it to strive towards a larger share of renewables and increased self-sufficiency. Over the years, the Korean government invested several rounds in the renewable energy sector: €1.5 billion in 2015 [4], €3.75 billion in 2017, planning to invest a further €7.2 billion by 2030 [5] and increase the total power generation from renewables to 35% by 2040 [6].

These initiatives paved the way for foreign solutions that tackle climate change to be brought in, including novel solutions [7] for energy prosumers (smart power grids, zero-energy buildings, household PV), low-carbon power generation (energy storage systems, mega gas turbines, carbon capture and storage), waste-to-energy (including waste energy recycling), self-sustaining power generation (offshore wind power, solar PV, ICT applications or smart energy systems).

All the above sub-sectors make up the focus of the Renewable Energy 3020 Implementation Plan that is meant to accelerate the growth of this industry to meet the ambitions targets. The “Low Carbon Green Growth” initiative and the National Energy Master Plan [8] also push towards a reduction of greenhouse gas emissions [9] by 37% and an improvement of energy efficiency by 46%.

“The Renewable Energy 3020 Implementation Plan, released by South Korea’s Ministry of Trade, Industry and Energy, is to increase renewable energy’s share from 7% to 20% by 2030 by providing 48.7GW of new generating capacity. The main renewable energy sub-sectors for the new production plants will be solar energy (30.8GW, 63%) and wind energy (16.5GW, 34%). By adding the new capacity of 48.7GW, the government aims for 63.8GW of renewable energy sources by 2030. In order to achieve the goal, the government announced new tasks regarding expanding PV in urban areas, expanding agricultural PV usage and large-scale projects” shared YoungJin Lee, expert in Green Energy Technologies in Korea [10].

The inaugural business mission [11] to The Republic of Korea targeting Green Energy Technologies took place in 2016.

2ES [12], a French company producing photovoltaic canopies, attended the business mission where it met several strategic contacts. 

Julie Oliveira from 2ES shared:

It is our first experience with the Korean market so I would say it is more a discovery of the functioning of this market. It was a very enriching experience.

Another French company designing and manufacturing Organic Rankine Cycle (ORC) turbines, AQYLON [13], expanded its offices overseas:

It was almost like speed dating, one pre-arranged business meeting after the other, but I must say I’m really happy about these meetings. It’s been really well organized, shared Antonio Mendes Nazare, VP Sales & Marketing Department at AQYLON.

German operator of the largest Virtual Power Plant in Europe, Next Kraftwerke, also attended the business mission.

Kerstin Pienisch, International Business Development at Next Kraftwerke, boasted that:

In Korea, there is a great interest for Virtual Power Plants and this also means a great interest in our company. 

Ecotricity [14], a UK based manufacturer of eco-friendly wind turbines, attended the mission and started a collaboration with Korea’s #1 integrated service provider:

We are fully convinced that EU Gateway | Business Avenues is an effective way for a small company to understand a market and start business relationships in Asia. —Dr Alex Alliston, Head of Sales and Business Development at Ecotricity Group Limited.

Finnish company Well Oy, specialised in the production of wave energy converters with minimal impact on the environment, teamed up with a Korean partner after the 2016 mission:

The best part of the business mission was reaching an agreement with our Korean partner. That is why I came. — Heikki Paakkinen, CEO of Wello Oy [15] (Finland)

Following these inspiring success stories from the 2016 business mission, the Republic of Korea was the chosen host for follow-up missions in 2018 [16], 2019 [17] and 2020 [18].

The 2018 business mission [19] yielded another great success from Czech company IVEP [20] which started its operations in Korea shortly after participating.

Marek Chladil, Managing Director at IVEP, shared:

We are now preparing to supply more than 200 pieces of railway switches and 150 pieces of electric drives (actuators) to operate the switch. We also work on other projects, including supplies for Korean EPC contractors for projects in third countries.

 

Healthcare & Medical Technologies [21]

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The Healthcare & Medical Technologies sector is another fast-growing industry [22] in the Republic of Korea, due to an ageing population (first among OECD countries in the rate of growth of its ageing population [23] — 4.3%) and spur in the medical devices sub-sector — estimated at € 44.59 million in 2016 and € 47.1 million in 2017, with a 6.2% Compound Annual Growth Rate (CAGR) (2012- 2017). It is the fourth largest healthcare market [24] in the Asia Pacific region, with a market size forecasted to reach € 4.5 billion by 2025.

With an expanding base of health-conscious consumers, the Republic of Korea is first-rate ground for healthcare and medical technologies [25] for age-related conditions, Magnetic Resonance Imaging (MRI) and Computed Tomography (CT) equipment, smart medical devices, diagnostics, ICT for health, telemedicine and remote health monitoring, nanotechnology healthcare, life science and biotechnology for health and dental products.

The sector benefitted from 3 EU-funded business missions, in 2017 [26], 2018 [27], and 2019 [28]. Each business mission [29] had participating companies travel to Seoul and visit the Korea International Medical & Hospital Equipment Show (KIMES), a world-renowned trade event that gathers the biggest names in the industry.

An Italian company, EB Neuro [30], attended the 2017 Healthcare & Medical Technologies mission [31] where it met several local businesses and signed an agreement for the exclusive distribution of its products on the Korean market.

Edoardo Dal Pra, Area Sales Manager at EB Neuro, shared:

The key point of our product basket is the completeness of the line, the long experience over the field and the possibility of providing custom-tailored solutions. (…) Thanks to EU Gateway | Business Avenues I met several interesting people, both end-users and dealers, and EB Neuro signed an agreement for the exclusive distribution of its products over the Korean market.

Greek healthcare company, G. Samaras [32], also attended the 2017 business mission where its novel products attracted local attention.

Menelaos Samaras, Director at G. SAMARAS, stated: 

We met a large number of interesting and potential clients during the business mission, who definitely could constitute our company’s key to the Korean market.

German manufacturer of surgical instruments and implants, Rebstock [33], attended the business mission where it established long-term collaborations with reputable Korean companies and got product orders.

Our expectations were exceeded; I didn’t think we would make this many good contacts in one day!  said Sebastian Rebstock, General Manager, Rebstock Instruments GmbH (Germany)

Polish manufacturer of surgical instruments, Chirmed [34], attended the mission and had this to say:

Weʼre really happy with the support we got from EU Gateway | Business Avenues: it is efficient and focused, better than any other exhibition we’ve been to. – Mrs Aneta Dyner, Chirmed (Poland)

A German company providing innovative suction and drainage technology for the Operating Room and care sector and complete workplace solutions in the ENT and gynaecology sectors, ATMOS [35], attended the 2018 Healthcare & Medical Technologies business mission in Korea.

Maik Greiser, CEO at ATMOS, shared with us: 

EU Gateway | Business Avenues is perfectly arranged and organised upfront. This is really different from other events where you just set up a booth yourself and don’t know who is going to get into your booth. 

 

Environment & Water Technologies [36]

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Another sector aligned with the Republic of Korea’s “greenification” programmes like the “Resource Circulation Economy and Society” initiative is Environment & Water Technologies.

The environmental industry has been growing at a steady pace of 15% annually [37] for the past 8 years. In 2020, Korea’s Ministry of Environment forecasted growth for the environmental industry to exceed € 107.7 billion [38].

Key sub-sectors like waste management, recycling, water supply, wastewater treatment and air pollution prevention cover 70% of the market share, opening tangible opportunities for European companies [39] looking to start joint ventures or partnerships with local companies.

At the same time, the local companies in the sector lag behind European ones in terms of innovation, giving foreign companies a competitive edge. Top opportunities abound for innovative technologies [40] in recycling e-waste, Waste-to-Energy (WtE) initiatives, bio-degradable plastics, Operations & Maintenance solutions, equipment for the water supply chain, advanced air pollution control technologies, noise & vibration control technologies and soil remediation & restoration solutions.

Three consecutive business missions dedicated to the Environment & Water Technologies sector brought selected European companies to Seoul in 2017 [41], 2018 [42], and 2019 [43].

HAURATON [44], a German company, began a distribution agreement with a local South Korean company, BLTEC, after attending the 2017 mission.

Adrian Bach, Technical Director Asia at HAURATON, said:

In 2017 the main purpose of our participation was to learn more about the Korean market and to find a distributor having the same spirit and vision as HAURATON. (…) The fair turned out to be good and we were able to establish a partnership with BLTEC. (…) It takes time to establish a brand and new technology in Korea, but it looks promising. 

 

Organic Food & Beverage [45]

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Another key sector with promising opportunities for foreign companies is Organic Food & Beverage. Aligned with Korea’s Strategy for Green Growth, the sector has been steadily growing in recent years. Imports of organic foods are particularly significant — 60 to 70% or organic food is imported [46], 85% of ingredients making organic foods are also imported.

The Republic of Korea is a prime market for companies [47] that offer reasonably priced organic food and beverages — such as organic processed foods or ingredients like flours, cereals, organic baby food — or “masstige” products (premium-labelled products of EU origin, especially chocolate and wine).

The Korea-EU Equivalency Agreement from 2015 means products carrying the EU organic certification label are automatically labelled “certified organic” in Korea as well.

The notably high demand and interest from the local population have created a niche market with high growth potential, namely an expected 18.73% of annual growth by 2020 [48]. Korea’s organic food market is estimated at €338 million [49] and expected to reach €447 million by 2025 [50].

In this landscape, the first business mission for Organic Food and Beverage — with a focus on Processed Organic products — took place in 2016 [51]. During the week, the participants visited the Food Week Korea exhibition  [52]and held business meetings with local organisations and companies of interest.

A German company, AcanChia [53], attended the 2016 business mission where it met various business partners. AcanChia later signed an agreement with HNI Korea. 

Wolfgang Neldner of AcanChia said:

Since the launch, sales quantities increased constantly and are now on a stable basis. Our participation in the Organic Food & Beverage mission in Korea put us very quickly in the position to find real distribution partners and to realize sales.

A Polish company, Mipama [54], has continued its relationship with S&C International, a local company it met at the business mission in 2016.

Magdalena Szafarz, a representative of Mipama, said: 

I didn’t know much about the Korean market before I went for the mission; I thought they were a more conservative community than they are. Now I know that Korean business people are very open minded, and open to new ideas and products, looking for novelties, which might be introduced on the Korean market.

The Danish producer of organic food, Berrifine [55], attended the business mission where it expanded its business with 2 new customers and a distributor.

Jørgen Stølsgård, Chairman of the Board at Berrifine, said:

EU Gateway | Business Avenues opens doors to many other potential clients for our products. We’ve had meetings with large international corporations who are present on this market, and who have some very interesting ideas for new product developments with us.

Cafés Oquendo [56], a Spanish producer of organic beverages with over 30 years of experience, attended the mission where it established a relationship with a South Korean local distributor. 

Marina Rayón Martínez-Noreña, Export Director at Cafés Oquendo, stated: 

The program allowed us to feel the market, to meet very important buyers and distributors and to understand all aspects needed to start a business in a new country, like their culture, their way of working, their influences and the way South Koreans shop.

The success of the first mission carried over to the subsequent missions in 2017 [57], 2018 [58], 2019 [59] and 2020 [60]. Each of these events brought participating companies increased exposure to the local markets and a chance to visit Food Korea Week, Korea’s largest general food industry exhibition that attracts 40,000+ visitors yearly.

Terre Cortesi Moncaro [61], an Italian company, started business relationships with local partners after the company attended the 2017 business mission [62] in the Republic of Korea.

Luigi Gagliardini, Export Sales Director at Terre Cortesi Moncaro, shared the good news:

Soon after the mission in Korea, we have started a business relationship with two importers. We believe we could grow with them, little by little. (…) Our plan now is to support the actual importers with promotional activities such as tastings, events, etc., and to increase business with them. We would also like to find new business partners, possibly participating in another business mission.

Wisdom of Nature [63], a Greek company, was in attendance for the business mission and began a collaboration with South Korean company, Yuhan. 

Dominik Brun, Sales & Marketing Manager at the Greek company, said:

Up to that date, we did not have a business relationship with anyone in Korea. Because we knew that the Korean people are interested in vinegars and that they use vinegars in their kitchen a lot, we defined Korea as a target market for our expansion to Asia. (…) This is our first business collaboration in Asia and it had a severe impact on our growth in 2018. We are looking forward to participating in other EU Gateway | Business Avenues missions in order to expand further and on other Asian markets. 

 

Contemporary European Design [64]

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Korea’s eclectic, design-oriented audiences, with increasing disposable incomes and highly individualized lifestyles led to a sudden spurt of the design sector.

Highly acclaimed are European designs, especially those that champion minimalism-driven design or multi-functionality [65]. Other sought after products [66] include small-scale customized items, low-priced living necessities targeting newlyweds and new families with children, as well as woodworking designs, matching sets, vintage and antiques, light and spatial design, and automation-oriented furniture design. It’s a highly promising landscape for European companies that are willing to enter the market either independently or through joint ventures with Korean companies.

Korea’s home furnishing market was worth €10 billion in 2017 and is forecasted to reach € 13.4 billion by 2023 [67], a 29% increase.

The sector had three dedicated business missions meant to help European companies access the market, in 2018 [68], 2019 [69] and 2020 [70].

Romanian company, Gabriela Seres [71], attended the 2018 mission [72] where it began a business relationship with South Korean distributor, Dokuatti. 

Eng. Dipl. Adrian Stefanescu, Executive Manager at Gabriela Seres, said:

We started our business in Korea following the fair with a very serious Korean distributor. They ordered our most successful tableware collection, the Estrelas. They selected for their first order the Teapot, Teacup, White Wine Glass, Red Wine Glass and Pitcher.

Dutch Company, Puik [73], entered a partnership with a local South Korean company after attending the 2019 Contemporary European Design mission [74].

Freek Claessen, Founder of Puik, shared:

We made an exclusive distribution agreement with SEVO KOREA. This is a big distributor near Seoul (…) They have 55 shops-in-shops in department stores, sell a lot through television and also to independent retailers. (…) The mission, in general, was amazing. The online platform where we could invite companies and they could invite us for appointments was very effective. This is also how we found our new partner SEVO KOREA. The mission turned out a great start for Puik on the Korean market; it’s now up to us and our partner to follow up.

Source URL: https://www.eu-gateway.eu/republic-korea

Links
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