"Seize Opportunities in Europe, Middle East, and China"… KOTRA Introduces Post-Corona Era Overseas Expansion Strategies

Directly Written by 10 KOTRA Overseas Regional Headquarters in North America, Europe, China, and Others

[Asia Economy Reporter Kim Ji-hee] The novel coronavirus infection (COVID-19) has gone beyond being a pandemic stage and is creating a new standard of everyday life called the 'New Normal.' In response, KOTRA has produced a special breaking news report to discover promising emerging markets by region worldwide in the post-COVID-19 era and to introduce strategies for Korean companies to enter these markets.

KOTRA President Kwon Pyung-oh stated, “The ways in which the COVID-19 crisis is being overcome vary by world region,” adding, “We hope this special news report will help our companies discover new business opportunities.” This material was directly prepared by 10 KOTRA overseas regional headquarters, including North America, Europe, and China, and can be accessed through the KOTRA Overseas Market News website.

First, regarding the North American region, KOTRA observed that “permanent changes in market conditions will inevitably lead to fundamental structural changes in the distribution industry and manufacturing.” They emphasized, “Attention should be paid to the growth of online D2C (Direct to Customer), targeting the MZ (Millennial-Z) generation,” and suggested, “Supply chain restructuring due to de-China movement will occur in fields such as medical devices and advanced equipment, and the increased Korea premium is also worth utilizing.”

For Europe, opportunity factors include hygiene and quarantine, digitalization, and supply chain diversification. KOTRA stated, “Our companies should target short-term market opportunities such as medical supplies and IT-related devices, while considering promising company M&A and entry into regional production systems from a mid- to long-term perspective.”

In the case of China, it was diagnosed that changes are occurring across consumption overall, including consumer awareness, purchasing channels, and consumption items amid the economic downturn. Emerging promising industries include healthcare, which has risen due to increased awareness of health and quarantine; online platforms, which have become the core of the digital economy based on AI, big data, and 5G technology; unmanned systems, whose safety and efficiency were verified during quarantine processes; and homeconomy, formed as time spent at home increased. The analysis suggests that Korean companies need entry strategies that actively utilize online and mobile platforms, internet live sales, and O2O (Online to Offline) business.

In Southeast Asia, COVID-19 has further accelerated cashless payments and online shopping. KOTRA emphasized, “Since the average age of ASEAN countries is in the 30s, online marketing is highly effective, so approaches through online platforms and active SNS marketing are necessary.” They also highlighted, “In response to the global GVC (Global Value Chain) restructuring, ASEAN countries will actively attract foreign companies, and the number of promising company listings will increase. Therefore, entry through production bases and M&A can also be considered.”

In the Middle East, ongoing low oil prices and the dual hardship of COVID-19 are heightening the region’s sense of crisis. Accordingly, investment in the medical industry will be strengthened, and entry leveraging the national brand enhanced by K-quarantine is advantageous, according to KOTRA’s analysis. KOTRA stated, “Import dependence across industries will decrease, and regional manufacturing base strengthening will be achieved,” adding, “Our companies can consider long-term entry into manufacturing and production facilities as well as future production base establishment.”

Regarding Japan, it was explained that “conservative business cultures such as paper documents and seals are changing due to COVID-19. IT business solutions are promising.” For consumer goods, “Diversification of entry strategies is necessary due to the expansion of e-commerce,” but “since the proportion of e-commerce varies by product category, a combination of online and offline is required.” Additionally, “It is possible to capture the demand of Japanese companies with production bases in China moving to ASEAN and explore third-country joint cooperation such as local procurement,” they added.

This content was produced with the assistance of AI translation services.