Business News for September
Foreign Direct Investment
POSCO E&C to build offshore wind power plant with Norwegian firm
South Korea’s POSCO E&C, formerly POSCO Engineering and Construction, and a Norwegian company are promoting the Ulsan Firefly project, the world’s largest for floating offshore wind power.
POSCO E&C on Aug. 24 said it signed the day before an agreement for the venture with Equinor, a global leader in offshore wind power. Their objective is to produce electricity by building a floating offshore wind power plant of 750 megawatts 70 kilometers off the coast of Ulsan, a scale sufficient enough to power all households in the coastal city.
The two companies will form strategic ties in development, construction and transportation for the project and others in domestic offshore wind power.
Korea to remove regulations to resolve labor shortage
The South Korean government has launched efforts to remove regulations that have hindered business investment. Korean President Yoon Suk Yeol presided over the 4th conference on regulatory innovation and strategy in Seoul on Aug. 24 and said, “Investment-killing regulations should be removed at a rapid pace for the sake of the private economy.”
In an effort to resolve labor shortage at industrial sites, the government has decided to allow non-specialized foreign workers to work for 10 years after entering the country and drastically reduce sectoral restrictions at 1,274 industrial complexes nationwide.
The Ministry of Justice and the Ministry of Employment and Labor have overhauled the system to increase the influx of foreign workers amid a shrinking population and job vacancies. Non-specialist foreign workers with E-9 visas were previously required to leave the country after working for four years and 10 months, but they will now be allowed to work for 10 years without leaving the country.
In addition, the quota for skilled laborers with E-7-4 visas, which was about 2,000 last year, will be increased 17.5 times to 35,000 this year, and the E-9 quota will be increased to 120,000 from 110,000.
Meanwhile, the Ministry of Trade, Industry, and Energy and the Ministry of Land, Infrastructure, and Transport will expand the range of sectors that can move into industrial complexes to actively encourage high-tech and new industry companies to move in and invest. Currently, about 120,000 companies are located at 1,274 industrial complexes nationwide. The Korea Institute for Industrial Economics & Trade estimated that the easing of industrial complex entry regulations will generate more than 24.4 trillion won ($18.42 billion) investment over 10 years.
Trade & Commerce
S. Korea pushing to sign free trade pacts with 7 emerging nations
South Korea is pushing to clinch free trade agreements with seven emerging and high-potential nations, including Kenya and Thailand, in an effort to boost growth momentum and diversify its trade portfolio, the industry ministry said on Aug. 25.
The country is working to sign a bilateral Economic Partnership Agreement (EPA) with Kenya, Tanzania, Morocco, Thailand, Pakistan, Serbia, and the Dominican Republic, and held a public hearing session in Seoul on Friday, according to the Ministry of Trade, Industry and Energy. "The seven nations bear high growth potential and have ample room for mutually beneficial cooperation with South Korea," Roh Keon-ki, Seoul's deputy minister for trade negotiations, said.
South Korea aims to clinch FTAs with more than 10 nations and a trade promotion framework with over 20 nations this year.
S. Korea retakes No. 1 spot in global shipbuilding orders in July
South Korea recaptured the top spot in new global shipbuilding orders for the first time in five months in July, industry data showed on Aug. 14. Local shipyards clinched orders totaling 1.46 million compensated gross tons (CGTs) to build 29 ships, accounting for 44 percent of the global total of 3.33 million CGTs, according to London-based Clarkson Research Services Ltd.
It marks the first time since February for South Korean shipbuilders to take the leading spot.
S. Korea's dutyfree sector expects boom from Chinese tourists' return
South Korea's duty-free stores are over the moon thanks to the resumption of Chinese group tours after a hiatus of six years and five months, with major chains like the Shilla Duty Free Shop and Lotte Duty Free offering discounts and promotions exclusively for Chinese tourists. Shilla on Aug. 27 said 31 group tourists brought by the government-run China Youth Travel Service (CYTS) visited the chain's store in Seoul's Jangchung-dong neighborhood the day before.
They entered the country on Aug. 24 under a package tour planned by the Korea Tourism Organization and CYTS to mark the 31st anniversary of diplomatic ties between both countries.
The domestic duty-free retail sector is thus engaged in intense competition to grab an early lead on the Chinese group tourism market.
Government & Policy
S. Korea to fully open gov't R&D projects to foreign researchers
South Korea's Ministry of Trade, Industry and Energy on Aug. 2 said it will allocate KRW 5 trillion (USD 3.8 billion) of its R&D budget for excellent foreign researchers including those with Korean ancestry.
The ministry will drastically revamp the system, which was run in a closed manner, to allow research institutions abroad with excellent planned projects to directly implement them.
The ministry will also directly issue patents to such researchers after government R&D is carried out, and will also begin exploring R&D demand for domestic companies and foreign researchers and aggressively start joint R&D with the US from early next year.
S. Korea to speed up development of AI chip, UAM sectors
South Korea's finance ministry unveiled a set of measures on Aug. 17 to pave the way for the growth of the country's artificial intelligence chip and urban air mobility (UAM) industries in line with efforts to foster new growth engines.
Under the plan, the country will speed up the establishment of data centers powered by homegrown AI chips and expand financial support for the development of such semiconductor products by fabless firms, according to the Ministry of Economy and Finance.
S. Korea to speed up development of AI chip, UAM sectors
South Korea also said it will establish a task force of government bodies to build a frequency exclusively for the UAM industry to take a leading role in setting global standards.
To speed up the development of self-driving cars, the government said it has revamped privacy laws to allow companies to utilize videos filmed by the automobiles to build a database.
The finance ministry added it plans to designate used EV batteries as a recyclable resource to seek sustainable growth, as current rules define them as disposable waste.
Source: www.investkorea.org, Yonhap News Agency, Korea Economic Daily Global Edition, Pulse by Maeil Business News Korea
*This article is extracted from Invest KOREA information center, 2023