Small and medium-sized enterprises (SMEs) in provinces face difficulties in many ways in the era of globalization. But if the provincial government or a provincial agency is dedicated to promoting their business overseas, tables could be turned in their favor. As an axiom says, “Things local are already global.” The more local, the closer to globalization.
The Gyeonggi Small & Medium Business Center (GSBC) is such a local agency promoting local businesses’ globalization. Since it was established in 1997 as the Gyeonggi Small & Medium Business Promotion Foundation and renamed GSBC in 1999, the GSBC has been aspiring to serve as “The Gateway to Global Business” under the slogan “From Startup to Global Business.” GSBC projects are part of Gyeonggi Province‘s efforts to become the economic hub of Northeast Asia, while GSBC is helping SMEs in the province go global without much difficulty.
GSBC CEO Hong Ki-hwa appeared very proud and confident, when he introduced GSBC’s contribution to leading provincial SMEs to overcome economic difficulties by helping them find new markets in the wake of the global financial crisis last year, during an interview with the Korea IT Times. He was also upbeat about the center’s plan for developing strategic markets based on strategic items in 2010. Hong is a top administrator specializing in the promotion of exports and exhibitions. Characteristically, he used to be president of KINTEX convention and exhibition center in Ilsan, Gyeonggi Province and president of the Korea Trade-Investment Promotion Agency (KOTRA) from 2005 to 2008. He is now leading GSBC, a provincial agency dedicated to promoting trade for SMEs in the province. There is one more thing to add:
his hometown, Hwaseong, is located in Gyeonggi.
Questions and answers follow:
Q: Would you tell us SMEs in Gyeonggi Province
A: There are about 40,000 small and medium-sized manufacturers in the province, accounting for about 33 percent of all small and medium industries (SMIs) in Korea. Some 5,600 venture capital firms are also operating in the province, taking up about 30 percent of such companies in the country. Such numbers show that Gyeonggi is the industrial center of Korea.
Q: Which overseas markets do SMEs in the province prefer and what are their strategic goods for export
A: According to a recent survey of small and medium-sized exporting firms in the province, SMEs here prefer markets in Asia, Europe, the Americas and the Middle East, in that order. This seems that they might have been influenced by the country’s conclusion of free trade agreements (FTAs). I think it important to make the most of the Korea-ASEAN FTA, Korea-India Comprehensive Economic Partnership Agreement (CEPA), Korea-EU FTA, and Korea-U.S. FTA.
The provincial SMEs’ strategic goods for export are Green energy items such as solar energy and bio-energy-related items, automobile components, and IT goods. Besides, I believe we can find new overseas markets, if we have competitiveness in goods of new technologies and new designs, energy-saving products, and new idea goods.
Q: What programs do you have to find new overseas markets
A: The most important thing in SMEs’ exports is to find buyers – how to find and have consultations with potential buyers who would buy their goods. GSBC is operating various programs to help them do this. One such program is “Export Consultations with Invited Potential Buyers.” The idea is to help SMEs have consultations with foreign buyers in the country and find overseas markets without much difficulty.
The second program is “Overseas Market Development” designed to launch overseas sales teams to help SMEs have consultations with potential buyers overseas. The idea is to support them in finding buyers easily through branches of the Gyeonggi Business Center (GBC) or the overseas network of KOTRA.
The third program is to help them participate in overseas exhibitions, which are the most important marketing outlets particularly in advanced nations. GSBC opens group exhibition halls for the provincial SMEs at prominent trade shows and gives subsidies to individual firms participating in exhibitions where it is difficult to take part in as a group. In addition, our center is hosting one or two Gyeonggi provincial goods exhibitions overseas. We’ve already hosted such shows twice this year – in Mumbai, India and Santiago, Chile.
GSBC is also operating GBC branches in Kuala Lumpur, and cities in BRICs with great growth potential, such as Mumbai, Moscow and Sao Paulo. In fact, GBC branches are playing the role of overseas branches of companies in Gyeonggi Province.
Q: What did you achieve from major trade or export shows, including G-Fair, this year
A: About 580 SMEs participated in the 12th G-Fair held this year, clearing the way for G-Fair to establish itself as the country’s largest exhibition of consumer goods produced by SMEs. During this year’s show, 330 foreign buyers and merchandise market managers from major Korean distributors were invited for about 2,153 export consultations. As a result, consultations for some US$370 million-worth exports were held and export contracts worth US$150 million were signed.
Besides, GSBC has hosted six rounds of export consultations, including those during G-Fair, and invited a total of 576 foreign buyers since January this year. As a result, a total of 4,046 export consultations have been held this year, in which consultations were talked about US$690 million-worth exports and US$190 million-worth export contracts were signed.
Especially, Korean SMEs have suffered many difficulties in the wake of the global financial crisis that broke out in October last year. They have been able to overcome such difficulties partly because GSBC has helped them find new markets. We’re very proud of it.
Q: What major trade promotion events and/or export consultations do you have for 2010
A: In 2010, with a goal of finding strategic markets and promoting strategic items, we’ll operate a program to develop overseas markets with focus on nations, with which our country has concluded FTAs, and on those with high growth potential. We’ll also focus on making inroads into component outsourcing markets for advanced countries, the Chinese market, and construction equipment markets in the Middle East.
We’ll also expand our overseas marketing project, including dispatching trade promotion teams and participating in overseas trade shows, and host G-Fair for outstanding goods produced in the province at KINTEX in the autumn on an enlarged basis.
Let me give you a briefing on major projects we’re going to implement next year. First of all, we plan to send overseas market development teams on 15 occasions, starting with the dispatch of a team to the auto component and machinery market in India in February. We’re going to host export consultations with more than 500 invited foreign buyers four times, beginning with the “G-Trade Global” export consultation event scheduled for January. As for overseas G-Fair shows, we’ll host two such events in Mumbai in May and Istanbul in the autumn, taking advantage of a better trade atmosphere created by the Korea-India CEPA and the Korea-EU FTA.
Q: What strategies do you have to implement future new-growth engine projects for SMEs in the province
A: We have a strategy to upgrade the level of the provincial industry and secure comparatively advantageous future new-growth engines through development of strategic industries compatible with characteristics of the provincial industries and through support for technological development. In 2009, GSBC supported 12 sectors in four industries – five sectors in the key industry including state-of-the-art conversion technological components, two in the conventional industry including textile, three in the Green industry including bioengineering, and two in the new industry including knowledge-based services.
Q: What PR and marketing strategies do you have to enhance global recognition of goods made by SMEs in the province
A: GSBC is operating www.tradehelper.or.kr, an online trade website, on which products of about 4,500 SMEs in the province are introduced. Furthermore, in order to enhance global recognition of their goods, we’re concentrating on keyword advertising on famous overseas search engines, such as Google, Yahoo! and MSN and other portal sites. Besides, we continue to send circular letters to potential foreign buyers, and actively publicize SMEs’ products by distributing e-directories and CDs. We’re also planning to put ads on global B2B websites, such as Alibaba, GlobalSources, EC21, ECPlaza, and Kompass, and overseas trade magazines.