Martial Arts, Korea Propose 'Next 20' for Mid- to Long-Term Trade Response

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[Asia Economy Reporter Park Sun-mi] The Korea International Trade Association's International Trade and Commerce Research Institute, celebrating its 20th anniversary, has presented ‘Next 20’ as four key preemptive tasks to respond to mid- to long-term changes in the global trade and commerce environment.

In the report titled ‘Changes in the Global Trade and Commerce Environment and Response Tasks: Next 20’ released on the 13th, the Korea International Trade Association's International Trade and Commerce Research Institute advised that the global trade environment is rapidly changing, focusing on the spread of supply chain crises after COVID-19, qualitative growth of exports, digital transformation, and new trade norms, and that Korea’s trade must proactively respond to these changes.

First, just as major countries such as the United States are concentrating policy capabilities to secure flexible and stable supply chain networks, it emphasized that Korea must also strengthen its response capabilities in emergencies by establishing a government-wide supply chain control tower. It also pointed out that for Korean exports to leap from quantitative growth to qualitative growth, it is essential to enhance the value-added effect of exports and to integrate manufacturing and services. Customized research and development (R&D) support is necessary so that export companies can maintain comparative advantages or improve technological capabilities.

Since COVID-19, with the expansion of the non-face-to-face economy, digital transformation using big data and artificial intelligence has emerged as a core factor for future export competitiveness; however, domestic export companies’ digital transformation is still at an insufficient level. According to a March survey of export companies, nearly half responded that digital transformation is either not progressing or progressing slowly, and 65% of respondents reported difficulties in securing R&D and infrastructure costs and specialized personnel. This is why there is advice to expand IT convergence-type R&D support and establish an export support system that considers digital expertise to accelerate the digital transformation speed of Korean companies.

New trade norms emphasizing economic security, environment, digital, labor, and human rights are also expected to affect Korea’s overall trade environment. The report stated, “Major countries such as the United States and the European Union (EU) are strengthening their own interests through bilateral and plurilateral agreements,” and emphasized, “We must participate in discussions from the initial stages of various upcoming negotiations, such as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), to achieve negotiation results that align with our practical interests.”

Cho Sang-hyun, Director of the International Trade and Commerce Research Institute, said, “The global trade and commerce environment remains challenging due to the prolonged US-China hegemonic competition,” and added, “To ensure that our trade maintains a good trend for the next 20 years, the public and private sectors must strengthen communication and establish a meticulous supply chain management system to respond calmly to unexpected supply chain crises.”

Meanwhile, on the occasion of its 20th anniversary, the International Trade and Commerce Research Institute held an online seminar at 2 p.m. on the same day under the theme ‘Changes in the Global Trade Environment and Responses,’ sharing the major transformation of the global trade environment and innovation tasks for export companies via video conference with export companies.

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