"Mid-sized Companies' Overseas Market Expansion Requires Comprehensive Policy Support System Activation"

Junggyeonryeon Announces Results of 'Survey on Challenges Faced by Mid-sized Companies Entering the US Market'
Urgent Need for Proactive Policies to Address Global Trade Norm Changes Including IPEF Participation

Korea Federation of Medium-sized Enterprises

[Asia Economy Reporter Kim Cheol-hyun] It was suggested that comprehensive policy efforts are urgently needed to respond to changes in the global trade environment in order to expand overseas markets, including the U.S. market.

On the 14th, the Korea Association of Medium & Large Business (KAMLB) announced this through the results of the "Survey on Difficulties Faced by Medium & Large Enterprises Entering the U.S. Market," conducted immediately after the decision to participate in the Korea-U.S. summit and the Indo-Pacific Economic Framework (IPEF) in May. This survey was conducted through online questionnaires and in-depth interviews targeting 18 medium & large enterprises with sales ranging from 100 billion to 3.6 trillion KRW, including those exporting to or operating business sites in the U.S., as well as those seeking local entry.

The survey results identified the top difficulty in exporting to the U.S. as the burden of export-related costs such as rising raw material prices. Medium & large enterprises pointed out that exchange rate fluctuations and management instability due to exchange losses, the complexity of technical regulations such as certifications, and lack of market information also exacerbate difficulties. KAMLB emphasized, "Since the success or failure of individual companies in the global market is directly linked to the stability of national industry and economy, a comprehensive policy support system should be activated, including expanding export financing support and simplifying export and licensing procedures."

For medium & large enterprises operating local business sites in the U.S., hiring local personnel, regardless of professional or simple labor positions, was identified as the most challenging issue. The increased logistics costs after the COVID-19 outbreak, cultural differences, fierce competition with local companies, and difficulties in obtaining local visas were also mentioned as major challenges. Furthermore, medium & large enterprises agreed that to effectively respond to changes in the trade environment, including Korea's participation in IPEF, the government must strengthen economic security such as stabilizing global supply chains and respond to new trade norms. The medium & large enterprise sector stated, "Considering the scale of trade with China, diplomatic responses are essential to resolve uncertainties regarding various issues such as potential trade environment instability caused by Korea's participation in IPEF and strengthened human rights and environmental regulations."

It was also suggested that proactive measures should be taken to reflect national interests in new global trade norms, actively utilize existing FTA agreements, and expedite policy efforts to secure supply chain stability for China-related industries. Lee Ho-jun, Executive Vice Chairman of KAMLB, said, "In addition to the collapse of global supply chains, the situation is becoming more chaotic with the U.S. Inflation Reduction Act and the declaration of the Biotechnology and Bio-Manufacturing Initiative," adding, "Government efforts, such as promoting the enactment of a basic law to establish a pan-government supply chain response system, should be carefully reviewed to ensure they function as an effective support system rather than additional regulations."

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