Since the 1960s, South Korea has achieved an incredible record of growth and integration into the world economy. Today Korea is a highly diversified economy with an annual gross domestic product (GDP) of about $951 billion dollars and a GDP per capita of $19,513. Living standards and education levels have risen and are now equivalent to or higher than those in industrialized western economies. Private consumption and exports of goods and services continue to be the key drivers of Korea’s economic growth. Korea is at the centre of northeast Asian global value chains and is a trading partner of many countries around the world. For example, Korea’s rise as a world leader in semiconductors (e.g. RAM and flash memory), digital displays (e.g. LCD and plasma panels) and other consumer electronics has been spectacular. Korean flagship companies like Samsung and LG have become household names around the world. The Korean government is now beginning to invest in industries ranging from aerospace, biotechnologies, clean technologies and robotics to financial services and entertainment. Businesses that succeed in Korea typically do so because they have a unique niche offering, can outperform competitors on quality, speed, price, reliability or service and have superior customer relationships.
Like other Asian economies, Korea has been strongly affected by the 2008/09 global economic downturn. The Korean economy started to contract in the fourth quarter of 2008, primarily due to a drop in manufacturing, and a decline in construction. In 2009, the Korean GDP increased by 0.2%, as growth resumed in the second half of he year. A rise in consumption and exports so far in 2010 have accelerated South Korea’s recovery., and good growth is anticipated for the year. While South Korea is experiencing one of the strongest recoveries among the OECD economies, further development will strongly depend on the course of government support measures.
The Government of Canada has identified Korea as a Global Commerce Strategy priority market—based on extensive consultation with government, academic and Canadian business and industry representatives—and has developed a comprehensive Market Plan that identifies the following sectors as offering clear market opportunities well suited to Canadian capabilities and interests in the region:
Canada-Korea Commercial Relations, 2005-2009 ($ Millions)
Canada is currently engaged in free trade agreement (FTA) negotiations with South Korea. A successful conclusion would deliver significant commercial benefits across a wide range of sectors of the Canadian economy—from agriculture to high-tech services—and expand opportunities for Canadian companies to capitalize on Korea’s strong place in supply chains that span Asia and the globe. As the FTA talks proceed, Canada’s Trade Commissioners in Korea continue to focus on promoting opportunities for greater bilateral trade in goods and services; facilitating investment in Korea by Canadian stakeholders; positioning Canada as a destination of choice for Korean investors; furthering science and technology and innovation partnerships with Korea’s many advanced-technology companies, and helping more Canadian companies successfully enter the market.
Canada has a number of bilateral trade and investment policy instruments in place that are helping to facilitate and support Canadian commercial engagement in Korea:
Unless otherwise stated, all data is for 2009 and expressed in Canadian dollars. All data based on latest available national statistics drawn from a variety of sources, including: Statistics Canada, Export Development Canada, Bank of Canada, IMF WEO, UNCTAD.
For further information about Korea, visit the Foreign Affairs and International Trade Canada website or contact the Trade Commissioner Service at 1-888-306-9991.
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