SEOUL, KOREA — Korea Trade-Investment Promotion Agency (KOTRA) places its core competencies on creating the equation, “KOTRA equals the equation for global business platform.”
On 5th May, KOTRA President Oh Young-ho said, “KOTRA will open special projects and other related initiatives in conjunction with the notion that KOTRA is a viable source of national trade and investment infrastructure for locating bigger markets and generating a bright future on the occasion of the 50th anniversary of its foundation.”
KOTRA, which takes credit for helping Korea surpass the USD 1 trillion mark in trade volume in 2011, has undergone vast restructuring to offer field-oriented support to companies. For instance, KOTRA set up a taskforce dedicated to assisting Korean SMEs in entering overseas markets. KOTRA’s shake-up was carried out as a result of the realization that a new direction is needed to assist Korea’s trade market in overcoming its weaknesses and adjusting to the fast-changing global trade environment. President Oh, said, “This year is very important to both KOTRA and Korea. This year, KOTRA marks the 50th anniversary of its creation and Korea is busy making preparations to achieve a new goal: breaking the USD 2 trillion mark in trade volume. I will personally ensure a renewed KOTRA to spearhead the globalization of Korean companies.”
Having reached the USD 1 trillion threshold in trade volume in 2011, Korea finally advanced into the world’s upper echelon of trading nations after five decades. KOTRA’s reshuffle, which coincided with the Korean government’s growth strategy to attain its next goal of hitting the USD 2 trillion mark in trade volume, goes hand in hand with KOTRA’s plan for “friendly administration,” namely, transfer of Korea’s growth model to other developing nations.
To usher in the era of posting over USD 2 trillion in trade volume, KOTRA defined a “Korean-style trade growth model”, and set forth three strategies (companies, markets and export strategies) as well as strategy-specific action plans. With the goal of transforming 500 Korean companies into exporters annually, KOTRA has developed a plan to help start-ups and beginner exporters through export promotion services such as exporter incubators, participation in overseas exhibitions, and expanded mentoring services. Each KOTRA employee will take be responsible for five companies in this initiative.
Also, KOTRA is set to provide global business partnering services to small but promising firms and well-established SMEs. In other words, by developing demand for joint product development from overseas global companies, KOTRA intends to help Korean companies forge systemic business relations ranging from the development of new products to the stage of mass production and sales. On top of that, KOTRA will select and support over 80 companies annually under the KOTRA World Champ Project so as to expedite overseas investment by Korean SMEs and leading companies.
KOTRA Restructures Itself to Lend a Helping Hand to SMEs
KOTRA has drawn up SME support policies for each growth stage and set up a SME taskforce (중소기업지원본부). By doing so, KOTRA is attempting to double the share of exporting SMEs from the current 2.5% to over 5%. Bearing in mind that the provision of export promotion support for SMEs is crucial to help Korea post over USD 2 trillion in trade, KOTRA created a specific SME taskforce (중소기업지원본부), which will offer SME-specific services that are appropriate to the SME’s level of growth to bolster new exporters and advanced exporters, and allow SMEs to be capable of competing on the global stage. KOTRA’s organization has also transitioned into a field-oriented one. Client meetings in and out of Korea and conferences participated in by global companies will be held to build a variety of cooperation models and address Korean exporters’ current difficulties with market entry. In particular, through meetings with domestic customers, KOTRA will ramp up its support for new growth engine industries. Examples of this include support for starting up a global business, job creation, industrial collaboration with emerging markets, project-based market entry, and medical services.
KOTRA also retooled its Strategic Marketing Department (전략마케팅본부) to ensure the provision of differentiated services in which are relevant the unique characteristics of each market. As for exports to the developed world, the newly created FTA Business Team (FTA사업팀), designed to facilitate overseas market entry by capitalizing on FTAs with developed nations, will furnish Korean companies with upscale, sophisticated support services through cooperation with leading global companies and industry-specific, differentiated marketing strategies. Meanwhile, KOTRA’s Industry & Resources Cooperation Department (산업자원협력실) will be reinforced to diversify the channels for entering emerging markets, such as project-based market entry and expansion of economic cooperation. KOTRA’s recent restructuring, which has been focusing on field-oriented services, has a strong connection with KOTRA President Oh Young-ho’s mantra: “Listen carefully to the voices of clients.” President Oh mentioned, “I have always stressed that problems clearly exist in the field, and so do the solutions to each one. To upgrade KOTRA into a more efficient and competitive agency, I will not slacken the reins of KOTRA’s reform.”
On the internal front, as KOTRA believes that the great performance of KOTRA employees will translate into an improvement in Korean companies’ export records, KOTRA will pay keen attention to KOTRA employee education programs, designed to foster creativity and leadership, and to the promotion of an open organizational culture. President Oh added, “KOTRA will evolve into an organization that is consistently committed to advancing the Korean economy. Refusing to make top-down, window-dressing makeovers, KOTRA is determined to reform itself in a bottom-up approach by creating a new corporate culture on the ground. The Customer Future Strategy Department (고객미래전략실), dedicated to job creation and customer and future strategy planning, was installed directly from the president’s office to strategically manage agency-wide tasks.
Market-Specific Strategies to Break the US$ 2 Trillion Mark in Trade Volume
KOTRA is planning on expanding FTA-backed business projects when it comes to targeting the Eurozone and US markets, the key strategic segment of KOTRA’s field-oriented management. First of all, FTA-sensitive markets, such as auto parts, consumer goods and the government procurement market will be analyzed and expanded through the implementation of a slew of business projects.
Furthermore, in emerging markets in Southeast Asia (including India and Indonesia), Central and South America (including Colombia) and the Middle East (including Libya), KOTRA’s overseas branches will be provided with more authority to handpick regional-specific products and initiatives and launch a variety of marketing activities. In China, the largest component of the emerging markets, KOTRA’s permanent directors were deployed in advance to help Korean companies tighten their grip on the Chinese market. Projects targeting consumer goods will be scaled up through businesses with larger supermarkets and online shops. On top of this, projects involving marketing activities and the creation of distribution and logistics networks are also in the pipeline.
In the midst of growing uncertainties over the global economy, KOTRA will continue to unearth niche markets. As part of KOTRA’s efforts to discover niche markets, a US$ 120 billion project to restore a post-war Libya and a project to make a foray into Myanmar’s market are receiving the support of KOTRA. In crafting approaches towards developing nations, KOTRA is poised to encourage the generation of trade infrastructure, the development of human resources and brisk public-private investments, rather than remaining content with selling products and offering aid. To that end, market entry strategies will be implemented in connection with SOC (social overhead capital) development projects, support for training trade professionals and provision of idle facilities (e.g. second-hand machinery and personal computers). In addition, the Korean wave will be fully exploited to spur up the exports of the Korean content industry, franchising and knowledge-based medical and educational devices.
KOTRA President Oh said, “In celebration of the 50th anniversary of KOTRA’s foundation, KOTRA will ponder different ways to better fulfill its four major functions (overseas marketing, field studies, attraction of foreign investment, and support for oversea market entry by Korean companies) in a bid to become an indisputable national platform for trade and investment in Korea. As its first step, KOTRA has been restructured into an agency that is capable of offering customer-oriented services and mounting preemptive responses to current issues in and out of Korea.