$500 Billion Export Goal Set for Next Year

$500 Billion Export Goal Set for Next Year

The government has announced an all-out offensive to boost exports. Officials in a trade promotion meeting on Tuesday decided next year’s export target of US$500 billion and vowed to achieve a trade surplus.

Knowledge Economy Minister Lee Youn-ho said the government will increase export insurance funds designed to protect exporters from payment defaults in developing countries by W40 trillion (US$1=W1,288) next year from the present W130 trillion to W170 trillion. The Korea Trade-Investment Promotion Agency will guarantee products made by small and mid-sized businesses under the logo “KOTRA Guaranteed Brand.”

To boost the export competitiveness of Korean-made hybrid cars to be marketed from July next year, the government will exempt owners from consumption tax as well as acquisition and registration tax. People who buy hybrid cars will also be exempt from government bonds required by all automobile purchasers. An official at the Knowledge Economy Ministry said the tax breaks will lower the price of a hybrid car, estimated to range between W24 million to W30 million, by as much as W3.1 million.

The government also decided to cut tariffs on imported equipment to manufacture IT products, while allowing consortiums between large and small businesses to hire people who are exempt from active military service. The scope of exemptions on income tax for workers dispatched overseas will rise from the present W1 million to W1.5 million.

It remains to be seen whether the government’s plans can be realistically implemented. Korea’s exports this year are estimated at $445 billion, and outbound shipments would have to rise 11 to 12 percent to achieve the target. Major Korean economic think tanks have predicted outbound shipments to total around $480 billion, rising only around 8 percent next year. The Korea International Trade Association estimates $482.5 billion, up 8.6 percent, the Samsung Economic Research Institute $484.7 billion, up 8.3 percent, and the LG Economic Research Institute $486.7 billion, up 8.9 percent.

(englishnews@chosun.com )

Commentary: I saw this and suddenly KLF came to mind. Are vows enough? Homage to, "They're justified and they're ancient?" Perhaps if most consumers in Korea's major export markets simply trade down as Walmart's retail customer growth indicates many US buyers are doing. Tongue in cheek, is this "Moo Moo Land?"