Minister of Knowledge Economy Choi Joong-kyung talks to Business Focus during an interview held at his office in the Gwacheon Government Complex in Gyeonggi Province on Aug. 16. / Korea Times photo by Shim Hyun-chul | Korea moving to sign package deals with Colombia, Ethiopia
By Kim Jae-kyoung
Following the 2008 financial crisis triggered by the U.S. subprime mortgage meltdown, there are two major trends dominating the global economy at both the national and corporate levels.
One is that governments and companies are trying to look further into the future to secure new growth engines for business sustainability. The other is that they are stepping up efforts to find untapped markets where they can take advantage of low costs and ample resources, with China’s rising labor costs erasing savings from the past.
Simply put, the central stage of the global economic war has been moving from a “red ocean” to a “blue ocean,” which refers to uncontested market space that holds great opportunities. This means that the world is facing an uphill battle over dwindling energy and other natural resources and eventually the expansion of their economic territories.
In fact, blue ocean, the term coined by W. Chan Kim and Renee Mauborgne, both professors at INSEAD, is gradually diminishing as China has already penetrated into many African and South American markets, which are considered relatively untouched areas.
Minister of Knowledge Economy Choi Joong-kyung is one of Korea’s few bureaucrats identifying this transformation. He is now at the forefront of the nation’s efforts to hunt for blue ocean markets.
Since he took office in January, he has placed “developing new markets” on his top agenda. In May, his ministry established a new team designed to tap new markets where Korean companies can increase their influence.
Korea on the move
South Korea is now speeding up its move to get the upper hand in some of the untapped markets such as Africa, the Middle East, Southeast Asia and South America. The government has already selected several countries as targets for strengthening economic ties.
They are Indonesia in Southeast Asia, Iraq and the United Arab Emirates (UAE) in the Middle East, Colombia in South America and possibly Ethiopia in Africa. Choi is seeking to sign package deals with these nations. One of the best examples is the recent deal with Indonesia, known as the Indonesia Grand Package.
When the government signed nine memorandums of understanding (MOUs) with Indonesia in May, he proposed what he called the grand package or a two-track approach, under which the two nations are seeking cooperation with both government and business levels concurrently.
The grand package in his words can raise the possibility of winning bigger deals compared to a one-by-one contract, as the approach can increase negotiating power. In other words, Korea can become deeply involved in a target nation’s long-term development projects in return for providing technology and know-how, which Choi believes will help secure new markets.
“The Indonesia Grand Package is the government’s attempt to join Indonesia’s Master Plan (economic development initiative) as a partner in seven key areas — industry/energy,trade/investment, construction, agriculture/fisheries, defense industry and policy/development finance,” Choi said in an interview with Business Focus held at his office in the Gwacheon Government Complex in Gyeonggi Province.
“Currently, we are planning to launch a taskforce solely in charge of promoting and accelerating the package,” he added.
For Minister Choi , the next target is Colombia. Colombian President Juan Manuel Santos has shown keen interest in the Korea’s development model. The reason the South American country wants to make business ties with Korea despite the fact that it has little to export is that it is taking Korea as a role model for industrial development.
The 55-year-old minister recently met with his counterpart from Colombia in Seoul and discussed bilateral ties on 32 economic cooperation projects. Colombia is a country where 80 percent of its territory has yet to be developed and many of its natural resources remain untouched.
“We are taking Colombia as the next success target following the Indonesia case,” he said. Given that the MOUs with Indonesia came after the presidential summit, it is highly likely that the MOU for the Colombia Grand Package will come in mid September at the latest.
Presidents Lee and Santos will have a summit on Sept. 15. Korea’s economic delegation is scheduled to make a visit to Colombia from Sept. 29 to Oct. 4.
Most recently, Choi, who was formerly ambassador to the Philippines, has added Ethiopia to his “blue ocean” list. During his visit in July to Africa with President Lee to support PyeongChang’s bid for the 2018 Winter Olympics, he found that the African country could be another opportunity for Korea.
“I think that Ethiopia can be another win-win solution for both countries if we help them create a (clothing production or agricultural) Multi-Industry Cluster there by using low labor costs and rich natural resources, such as raw cotton,” he said.
Choi’s ambition to tap the Ethiopian market is in line with the ministry’s new strategy of TTC cooperation, under which Korea offers Technology, Training and Consulting in exchange for the rights to develop new markets.
Earlier in April, the government also inked a deal with Iraq to garner the rights to oil supplies — 250,000 barrels per day. In May, it also sealed a deal with the UAE to secure the right to participate in the production at oil fields there with a minimum of 1 billion barrels in reserves.
The minister’s strong passion for developing new markets may come from his belief that a small, open economy like South Korea should focus on boosting exports and keeping the current account balance in good shape for sustainable growth.
Inflation versus external risks
Due to ample liquidity in the market caused by prolonged low rate policies, inflation has been one of the biggest headaches for policymakers. Some argue that the government should let the Korean won appreciate further to curb inflation.
Known as a market interventionist, the former vice finance minister, however, is set against this idea. He believes that artificial adjustment of the exchange rate can cause unwanted outcomes without achieving the intended goal.
“A small, open economy is vulnerable to external shocks. It is not desirable to artificially strengthen the value of the won because it can augment external risks by increasing foreign debts and deteriorating the current account balance,” he said.
“Also, such intervention can expose the local market to currency speculators, while deteriorating small firms’ export profitability,” he added. “If trade accounts worsen due to lower profit margins while foreign debts rise as a result of the intervention, the country can face problems in the external side.”
In the midst of the 2008 crisis, Choi, who spent most of his career at the finance ministry, was criticized heavily for his weak won policy. However, his policy was credited later for helping the country weather the crisis faster with the economy getting back on track.
In the meantime, Choi downplayed concerns over a double-dip downturn of the global economy. “I think chances are slim that the global economy will slip back into a double dipping despite fiscal troubles in the United States and Europe,” he said.
“Effective policy responses by the U.S. and Europe, and international cooperation of the G-20 countries, will be a key to overcoming the ongoing crisis.”
But even if some of the major powers fall into a critical situation, Korea will be able to withstand shocks from outside, he stressed, citing improvement in key indicators measuring external risks, such as foreign reserves, structure of foreign debts, current account balance and national credit ratings. |
한국, 저개발 자원부국과 패키지딜 추진 (최중경 지식 경제부 장관 인터뷰)
- 대안주유소 치솟는 기름값 잡기 위한 대안
- 더블딥 가능성은 크지 않아, 국제적 공조 필요
- 미, 유럽 위기 치닫더라도 한국경제 견뎌낼 수 있을 것
2008년 글로벌 금융위기 이후에 세계 경제에 변화를 가져온 두 개의 주요 트렌드가 있다. 하나는 각국 정부와 기업들이 미래 지향적으로 변했다는 것이다 지속 가능한 성장을 위해 새로운 성장동력을 찾기 위해 노력하고 있다. 다른 하나는 비용상승과 자원 부족의 문제점을 해결하기 위 새로운 시장 개척에 나섰다는 것이다.
간단히 말해, 세계 경제 전쟁의 주 무대가 기존의 “레드 오션”에서 “블루 오션”으로 옮겨지고 있다. 이는 에너지 확보 및 경제영토 확장을 위한 글로벌 경쟁이 점점 더 치열해 질 것임을 의미한다.
사실, 지난 몇 년간 중국정부 및 중국 경제인들이 아프리카와 남미 시장에 공격적으로 침투하면서 블루오션으로 여겨지는 시장은 점점 줄어들고 있는 상황이다.
최중경 지식경제부 장관은 물밑에서 벌어지고 있는 이러한 흐름을 읽고 있는 몇 안되는 고위 관료이다. 그는 현 이명박 정부가 추진하고 있는 블루오션 시장 개척 노력의 선봉에 서 있다. 지난 1월 취임 후 최장관은 “새로운 시장 개척”에 많은 노력을 기울여 오고 있다. 5월에는 우리 기업들의 활동무대를 넓힐 새로운 블루오션을 만들기 위해 산업자원협력실을 신설했다
블루오션 개척을 위한 구체적인 노력으로 지경부는 대륙별로 우선 협상 대상국을 선정하고 있다. 동남아의 인도네시아, 중동의 이락크와 UAE, 남미의 콜롬비아, 그리고 아프리카의 이티오피아가 지경부의 리스트에 포함되어 있다. 최중경 장관은 이 국가들과 개별 분야별 협정보다는 경제 전반에 걸쳐 패키지 딜을 구상하고 있다.
가장 단적인 예가 “인도네시아 그랜드 패키지”다. 지난 5월 인도네시아 정부와 9개의 MOU를 체결할 당시 최장관은 “그랜드 패키지” 혹은 “투-트랙 접근” 방식을 제안 했다. 이는 인도네시아의 경제 개발 계획에 정부, 민간 차원에서 동시에 경제협력을 추진하는 것을 말한다.
최장관은 패키지 딜을 추진함으로 해서 협상력을 높여 좀더 큰 딜을 확보할 수 있을 거라 믿는다. 다시 말해 우리는 기술과 노하우를 전수해 주면서 각 국의 경제개발 프로젝트에 깊이 관여 함으로서 유망 시장을 선점 할 수 있다는 전략이다.
“인도네시아 그랜드 패키지는 인도네시아가 수립한 자국의 경제개발 마스트 플랜에 주 파트너로 우리가 참여하여 산업/에너지, 무역/투자, 건설/인프라, 농림/수산, 방산, 정책/개발금융 등 7개 분야에서 총 55개 의제를 추진하고 있는 것을 말합니다,” 최장관은 최근 과천 정부종합청사에서 갖은 비즈니스포커스 (코리아타임스 주간 경제섹션)과의 인터뷰에서 말했다.
“현재 그랜드 패키지를 밀착 추진하기 위한 별도의 전담 조직을 설치하는 방안을 검토 중에 있습니다.”
최장관에게 다음 타켓은 남미의 콜롬비아다.
“인도네시아 다음의 성공모델로는 중남미의 콜롬비아를 생각하고 있습니다.” 최근 최장관은 콜롬비아 상공부와 에너지부 장관을 만나서 총 32개의 ‘경제협력사업’을 논의했다.
지경부는 새로운 블루오션 개척을 위해서 적정기술(Appropriate Technology)과 교육•훈련(Training), 자문(Consulting)을 결합한 협력패키지인 TTC 협력을 검토 중에 있다. 최장관은 이티오피아를 TTC 협력의 대상국으로 고려하고 있다.
“에티오피아의 풍부한 면화•피혁, 저임금을 활용하여 현지에 의류생산 또는 피혁 농공복합단지(MIC)를 조성하면, 두 나라 모두에게 좋은 비즈니스가 될 수 있을 것입니다.”
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