Korea taking steps to remedy substantial trade deficit Recently, Korea IT Times interviewed Key Lee, Senior Trade investment commissioner of the Korea Trade Center Sydney, to find out more about KTC Sydney's business activities and Australian buyers' attitudes to Korean products. KTC Sydney is the Australian branch of KOTRA (Korea Trade - Investment Promotion Agency: www.kotra.or.kr). The following is a summary of this magazine's interview with him. According to senior commissioner Lee, during the past 10 months of this year, Korea has imported from Australia US$7.9 billion worth of minerals, corn, etc. and exported US$3.1 billion of electronics products, automobiles, etc. As a result, the trade deficit stands at about $4.8 billion. Because of this trade imbalance, KTC Sydney continues to raise this problem at seminars or business meetings. In a sense, the trade deficit is inevitable because Korea has to import from Australia many raw materials that are absolutely necessary for the production of its goods. However, Korean companies are required to make more efforts to bring about a more equitable trade balance between the two nations by exporting more Korean products to Australia. This year KTC is trying to expand exports of IT-related products including network devices and online settlement software. Korean Electronics Products Gaining Popularity Traditionally, Australians have a preference for U.S. and Japanese brands. However, recently, the brand power and image of Korea's large enterprises - for example, Samsung Electronics and LG Electronics - have been greatly improved. Koreanmade refrigerators, LCDs TVs, CD-ROMs are steadily being selected as "best buy" goods. In 2004, the cellular phones of Samsung Electronics attracted Australian buyer's attention as the best design product. In a recent market survey, it was reported that in the case of flat TVs, a majority of consumers said they wanted to buy Sony products, but it was proved that in terms of actual sales, Korea's LG products took the lead in the market. Meanwhile, compared with its overall economic level, the supply rate of the highway Internet network is relatively low, and so some media are pointing out that the Australian government should follow in Korea's steps in the IT industry. Besides, owing to high oil prices, the small-size cars are recently gaining popularity. Because of this, Korean-made cars such as Accent, Gets, and Elantra are selling well, and as a result Hyundai's market share has recently increased to nearly 5%. Australians Eye Korea's Mobile Technology This year KTC Sydney has provided 500 Korean companies with market survey reports, assistance for the establishment of branches, and market exploring business. Also, KTC has introduced more than 900 Australian buyers to the Korean companies. This year KTC put emphasis on the IT field. Accordingly, KTC Sydney has supported the market exploration team composed of mobile technology and contentsrelated firms, inviting an influential Australian mobile carrier into Korea for business consultations. Australia's mobile market is developing rapidly in terms of service and speed, and so KTC had in-depth consultations with an Australian mobile carrier as to the way of introducing Korea's service system. Extremely Conservative Buying Pattern Owing to geographical reasons, imported products cannot be easily redistributed. That is to say, if the planned volume of products is not sold in the market, the buyer has to suffer losses. Australian consumers' buying patterns are extremely conservative in choosing products, and so they are reluctant to change existing business partners. Another important characteristic of Australian industry is that its manufacturing industry is not fully developed. Because of this reason, parts supply is not easy. Also, due to high wage costs and operational expenses, the operation shutdown caused by defective products can bring about a serious problem. Therefore, it is very important to supply reliable products and establish a thorough after-sales service system.