Despite COVID-19, K-Bio Performs Well... Bank of Korea Reports Increasing Pharmaceutical Production and Exports in Incheon

[Asia Economy Reporter Eunbyeol Kim] Despite the impact of the novel coronavirus disease (COVID-19), the production and export of pharmaceuticals in the Incheon region continued to grow.

According to the Bank of Korea on the 27th, pharmaceutical production in the Incheon region increased by 55.8% year-on-year in the first quarter of this year and further rose by 11.1% in April. This growth rate is significantly higher compared to the national average, which recorded 12.9% in the first quarter and -0.3% in April.

Exports also surged by 99.2% year-on-year in the first quarter, greatly surpassing last year's (12.4%) and the national (52.5%) figures, and maintained a high growth rate of 88.2% during April and May.

Kim Ah-hyun, a manager at the Bank of Korea Incheon branch, explained, "The major export products of the Incheon region, biosimilar products, are essential medicines such as autoimmune disease treatments and anticancer drugs, which were not directly affected by COVID-19. Additionally, these products have recently been launched consecutively in Europe and the United States."

Looking at exports by country and region, pharmaceutical exports to Europe showed strong growth. Competition in the European biosimilar market has intensified, leading some large pharmaceutical companies with low cost competitiveness (Pfizer, Amgen, Boehringer Ingelheim) to consecutively withdraw their plans to launch in the European market. Manager Kim predicted, "This phenomenon will continue for the time being as the sales of biosimilar products expand."

From January to May this year, Incheon's exports to Europe increased by 102.2%, a sharp rise compared to 17.9% in the same period last year. The export share reached 75.0%.

As K-Bio gains attention as a post-COVID industrial strategy, fostering the bioindustry within the region is being emphasized even more. Discussions are emerging about changing the structure that is concentrated only in a few large companies and lacks small and medium-sized bio ventures.

Tourism demand in the Jeju region sharply declined but has recently shown signs of easing. Travel agencies in Jeju saw a sharp drop in sales from January to April, with 31 out of 1,123 agencies closing. The number of restaurant closures during the same period increased by 70.4% year-on-year, totaling 271 closures.

However, the number of tourists in May recovered as overseas travel demand was replaced by domestic travel destinations. Recovery was particularly seen in golf courses and luxury hotels. Credit card payments at golf courses in May shifted from a decrease in March and April (year-on-year) to a 4.6% increase year-on-year.

[Image source=Yonhap News]

In the Gangwon region, the impact of COVID-19 continued, and travel sentiment has not yet recovered, resulting in ongoing sluggishness. Although tourism-related service production showed a moderate recovery last year, it sharply declined in the first quarter of this year due to the COVID-19 situation. Lee Gyu-hwan, a manager at the Bank of Korea Gangwon branch, stated, "The total number of visitors from April to May decreased by 72.5% year-on-year." The mining area also saw a significant drop in visitors as the Kangwon Land casino was closed.

Meanwhile, in the Gangneung and Sokcho areas, known as coffee cities, the number of coffee shops increased despite COVID-19. According to an analysis by Park Jeong-hyun, manager at the Bank of Korea Gangneung branch, the number of coffee shops in the first quarter of this year rose by 9.2% year-on-year, continuing the growth trend. This is the highest level since 2016 based on the first quarter. Newly opened stores in the first quarter numbered 46, exceeding the average of 44 stores over the previous three years. Forty-five percent of coffee shops in the Yeongdong region are concentrated in Gangneung, adjacent to the East Coast. Manager Park said, "If the COVID-19 situation stabilizes, improved transportation conditions will increase tourists, leading to favorable growth."

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