Gov’t Targets $500 Bln in Exports Next Year

The government plans to increase exports to 500 billion U.S. dollars next year to revive the domestic economy in the wake of the global economic crisis.

Insurance coverage for exporters will be raised 40 trillion won (31.2 billion dollars), and the Korea Trade-Investment Promotion Agency will guarantee product brands manufactured by small- and mid-size companies enjoying high brand recognition overseas.

The Knowledge Economy Ministry announced strategies and measures to increase exports next year at a meeting chaired by President Lee Myung-bak at the COEX Mall in southern Seoul.

The meeting concluded that expanding exports is the most effective way to overcome economic difficulties. Next year’s export target will be raised 53 billion dollars from this year’s to 447 billion dollars.

Upon approval from the National Assembly, the ministry will increase insurance coverage for exports by the Korea Export Insurance Corp. from 130 trillion won (101 billion dollars) to 170 trillion won (133 billion dollars), and increase funding for export insurance funds.

Tax incentives are slated to expand domestic consumption and exports. Those who purchase a hybrid car will get an individual income tax credit and be exempt from acquisition and registration taxes.

For example, a buyer of a hybrid car priced at 300 million won (234,300 dollars) will get a discount of 3.1 million won (2,420 dollars).

The government will also consider cutting tariffs on IT manufacturing equipment and extending the period for tariff quotas.

Overseas marketing strategies will be sought by categorizing export destinations as mature, growth and potential markets. The trade promotion agency will guarantee the quality of products made by smaller companies to help their exports.

In his greeting, President Lee said the country is in a state of emergency. “Financial and foreign currency liquidity problems have been addressed to some degree, and now we have to deal with the slowdown of the real economy. Above all, exports have become the greatest concern among the people and will affect our economy most next year,” he said.

“Korea is a major export-dependent country and exports are the lifeline of our economy. I hope our exporters can see good results next year by diversifying their markets and putting out new products.”

“In the past, I was unwelcome at bank counters though the government said it would help out or put more money in the market. When unnecessary, banks encourage people to borrow but when necessary, they change their attitude.”

Complaining about their difficulties from the slowdown of the real economy in advanced economies and from the financial crisis, trade representatives at the meeting urged expanding financial aid to exporters; increasing assistance to overseas marketing; and forming a pool of experts on export industries.

One hundred officials and businessmen attended the meeting, including Knowledge Economy Minister Lee Youn-ho; Land, Transport and Maritime Affairs Minister Chung Jong-hwan; Korea International Trade Association Chairman Lee Hee-beom; Korea Trade-Investment Promotion Agency President Cho Hwan-eik; GS Caltex Chairman Hur Dong-soo; and STX Group Chairman Kang Duk-soo.