Logo of the Federation of Korean Industries
Despite state-driven efforts to strengthen ties with Southeast Asian nations, South Korea‘s trade and investment with the region still lag behind China and Taiwan, according to the Federation of Korean Industries on July 21.
Since President Moon Jae-in took office in May 2017, he has pushed for elevating economic and investment cooperation with the 10 members of the Association of Southeast Asian Nations -- Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam -- in the ”New Southern Policy.“
Despite the government’s drive to widen the nation’s diplomatic horizons, its share in ASEAN countries’ overseas imports decreased to 6.9 percent in 2020 from 7.7 percent in 2017, data showed.
This was largely led by last year’s 18.2 percent decline in the nation’s outbound shipments to Indonesia, which boasts the largest population in Southeast Asia.
The figure for China, on the other hand, rose 2.4 percentage points to 22.4 percent in the same period, as the nation shifted its focus toward increasing ties with its Asian neighbors to counter the prolonged trade tensions with the US. Taiwan also saw its market share climb 0.2 percentage points to 5.6 percent.
With a slowdown in exports to Southeast Asia, trade volume between Seoul and the ASEAN bloc was estimated at $164 billion last year, which fell short of the $200 billion goal set by the government four years ago, the research agency said.
Meanwhile, the number of people traveling between them increased more than 10 percent every year from 2010 to exceed 12 million in 2019, but it failed to reach the government’s target of 15 million by the end of last year, due to the COVID-19 pandemic, it added.
“Amid the intensifying trade friction between the US and China, the ASEAN nations have emerged as an alternative market. Through the New Southern Policy, the government strived to maintain close ties with all the 10 ASEAN nations, but the country still exhibits a heavy reliance on Vietnam,” said Kim Bong-man, head of the international affairs division at the federation.
“To widen the nation’s trade ties with the ASEAN market, the National Assembly should ratify a number of trade agreements with the ASEAN nations, including the comprehensive economic partnership with Indonesia and a bilateral free trade deal with Cambodia.”
By Choi Jae-hee (email@example.com)