UK companies are today (6 November 2013) celebrating new trade partnerships with South Korea, which will boost commercial ties between the 2 countries.
The announcements come during a state visit to the UK by The Republic of Korea’s President, Park Geun-hye, in her first official visit to the UK since her election.
At the inaugural JETCO (Joint Economic and Trade Committee) this morning Business Secretary Vince Cable and Korea’s Minister of Trade, Industry & Energy, Yoon Sang-jick, committed to doubling trade by 2020, and doubling foreign direct investment between the UK and South Korea by 2020.
A number of trade deals were also signed including Hyundai Capital UK and Santander Bank announcing a £20 million expansion to provide finance packages to buyers of Hyundai and Kia vehicles as part of a scheme that will create 40 new UK jobs.
Since the EU Korea Free Trade Agreement was signed in July 2011, entering the South Korean market has become easier for UK companies. UK exports to Korea reached a new historical peak in 2012 and the UK is now Korea’s 2nd largest trading partner among EU countries.
Business Secretary Vince Cable said:
UK goods exports to Korea increased 82% year-on-year in 2012 making South Korea the single largest growth market for UK exports.
Korea will be the 10th largest contributor to world growth over the next 5 years and companies such Samsung, LG and Hyundai are already global names. That’s why we’re working to making it quicker and easier for British and Korean companies to do business together.
Further trade deals announced during the visit include:
the University of Oxford was awarded a grant of over £600,000 to conduct research on energy technologies in cooperation with Korean academic and industrial partners
both Newcastle and Strathclyde universities signed separate memorandums of understanding (MOUs) with the Korea Institute for Advancement of Technology and the Korea Offshore and Shipbuilding Association to commit to 3 intakes of postgraduate students, with £5 million per year to be shared between the 2 universities.
Lloyd’s Register and Korea Hydro & Nuclear Power Co. Ltd. signed a contract worth more than £6.5 million to perform independent verification of nuclear facilities in the Republic of Korea. The agreement recognises the importance of independent assessment, which promotes greater industry collaboration for safety, reassuring the industry stakeholders and the public of the safety of Korea civil nuclear industry
Hana Financial Group signed an MOU with Barclays Group to support Korean corporations initiating or promoting businesses in Africa. Hana Bank will utilise Barclays Africa’s broad geographical footprint and capabilities to provide comprehensive and competitive financial services for Korean customers in Africa where Korean banks have yet to establish a presence
Imperial College and Postech signed an MOU to stimulate further collaborations between the UK and Korea in the area of hydrogen & fuel cells, leveraging funding from both the Engineering and Physical Sciences Research Council (EPSRC) and the Korean government
UK Export Finance (UKEF) signed an MOU on reinsurance with the Korean export credit agency, Korea Trade Insurance Corporation (K-Sure) which sets out how the 2 agencies will cooperate in the field of export credits
UKEF also signed an MOU on mutual support with the Export-Import Bank of Korea (Korea Eximbank) setting out how the 2 agencies will cooperate in the field of export credits and aim to boost co-operation between the 2 nations in support of national exports
the Korea Development Bank, the Korea Venture Capital Association and the British Venture Capital Association have signed an MOU committing support to Korean and UK businesses in third countries, and agreeing to exchange information on venture capital investment
Energy Secretary Ed Davey and Korea’s Minister of Trade, Industry & Energy, Yoon Sang-jick signed a MOU committing both governments to cooperate in commercial civil nuclear matters, both in the UK, South Korea and in third countries
UK Trade & Investment (UKTI) signed a MOU with the Korea Trade-Investment Promotion Agency, which will underpin the pledge between the 2 countries to double trade and investment by 2020
UKTI, the Korea Exchange Bank, and the Korea Federation of Small and Medium Business signed an MOU to formalise their working relationship, help UKTI to broaden its client base in Korea and attract even more high-value investment from the market
The UK’s Trade & Investment Minister Lord Green also launched the Korea-UK Global CEO forum which brings together business leaders from both countries to create new commercial partnerships.
Notes to editors:
The Korean economy will be the 10th largest contributor to world growth over the next 5 years, comparable to that of the UK, or greater than France, or Italy.
7% of GDP in Korea is spent on education and 74% of Koreans undertake post-graduate level education. This presents excellent opportunities for UK education providers.
Major UK exports to Korea include general industrial machinery and equipment, medicinal and pharmaceutical products and beverages.
Significant Korean exports to the UK include electrical machinery, appliances and parts, telecommunication, sound recording, sound reproducing appliances and road vehicles.
More than 200 Korean companies have already set-up their businesses in the UK. Major Korean investors include:
- Korea National Oil Company (KNOC), the largest Korean investor in the UK through its acquisition of Dana Petroleum. KNOC/Dana, with support from the Embassy, has recently announced its £1.1 billion Western Isles expansion project
- Samsung Electronics and LG Electronics, both of which have European HQ and design/R&D facilities in UK
- Samsung C&T, which recently acquired Darlington-based Whessoe Engineering, and is a partner in the consortium that recently won the contract to build the £600m Mersey Gateway bridge
- the Korea National Pension Service (NPS), the world’s third largest pension fund that opened its European HQ in London in June 2012 and has infrastructure assets including the HSBC Tower and a 12% stake in Gatwick Airport
- the Korean Investment Corporation (KIC), Korea’s sovereign wealth fund, which opened its European HQ in London in December 2011. KIC has acquired UK real estate, and is looking to diversify as an equity investor in a number of projects
6.In the 2012 Autumn Statement, UKTI was awarded an additional £70 million for each of 2013/14 and 2014/15, enabling the recruitment of more international trade advisers around the country, expansion of existing services including the Trade Access Programme (TAP) and the Overseas Market Introduction Service (OMIS), and support to expand the range of assistance available to UK companies through overseas British chambers of commerce.
7.The government’s economic policy objective is to achieve ‘strong, sustainable and balanced growth that is more evenly shared across the country and between industries’. It set 4 ambitions in the ‘Plan for Growth’, published at Budget 2011:
- to create the most competitive tax system in the G20
- to make the UK the best place in Europe to start, finance and grow a business
- to encourage investment and exports as a route to a more balanced economy
- to create a more educated workforce that is the most flexible in Europe.
Work is underway across government to achieve these ambitions, including progress on more than 250 measures as part of the Growth Review. Developing an Industrial Strategy gives new impetus to this work by providing businesses, investors and the public with more clarity about the long-term direction in which the government wants the economy to travel.
8.UK Trade & Investment (UKTI) is the government department that helps UK-based companies succeed in the global economy. We also help overseas companies bring their high quality investment to the UK’s economy – acknowledged as Europe’s best place from which to succeed in global business. UKTI offers expertise and contacts through its extensive network of specialists in the UK, and in British embassies and other diplomatic offices around the world. We provide companies with the tools they require to be competitive on the world stage. For more information on UKTI, visit www.ukti.gov.uk or visit the online newsroom at www.ukti.gov.uk/media.
9.UK Export Finance is the UK’s export credit agency. It complements the private market by providing assistance to UK businesses, principally in the form of insurance to exporters and guarantees to banks. In doing so, it works with exporters, banks and project sponsors to support UK exports to, and investments in, markets across the world.
10.Korea Trade Insurance Corporation (K-sure) was founded by the Korean government in 1992 to operate export and import insurance programs for the purpose of facilitating global trade.
11.The Export-Import Bank of Korea (Korea Eximbank) is an official export credit agency providing comprehensive export credit and guarantee programs to support Korean enterprises in conducting overseas business.