5 - Singapore-Korea Business Linkages Post-KSFTA and Implementation

Summary

This chapter aims to analyse some of emerging trends in Singapore's businesses entering Korea post-KSFTA, highlighting the success of specific Singapore companies that have benefited from the KSFTA. The chapter also highlights some of the mechanisms through which the KSFTA implementation is being monitored, focusing on the facilitative role played by International Enterprise (IE) Singapore in this process.

POST KSFTA SCENARIO AND BUSINESS ACTIVITIES

While Singapore companies in the real estate and food services were been particularly active in Korea even prior to the KSFTA, IE Singapore has been actively assisting Singapore companies in their ventures to and expansion in Korea by playing the facilitator's role and providing market know-how. In 2006, IE led four missions to Korea in sectors such as Infocomm Technology (ICT), Electronics and Precision Engineering (EPE), Lifestyle Services and Business Services. These missions were aimed at helping companies to explore the market and meet up with potential Korean partners. IE Singapore has planned another four out-going missions to Korea this year. It also signed a Memorandum of Understanding with the Korea-Trade Investment Promotion Agency (KOTRA) to foster greater trade and investment between the two countries through collaborative activities. Two key Korean agencies, the Korea International Trade Association (KITA) and the Small Business Corporation (SBC), established representative offices in Singapore in 2006.

According to the Korea International Trade Association, figures of growth rates of exports and imports of some major items of trade between Korea and Singapore have revealed that products such as oil and chemicals on which tariff reductions were undertaken by Korea in the KSFTA have led to expansion of imports of these products from Singapore 10 months after the KSFTA took effect, compared to its growth 10 months before the agreement was implemented. On the export side, semiconductors and steel slabs have seen a comparatively higher growth rate from Korea to Singapore in the post-KSFTA period.