Office of Commercial Affairs,
Royal Thai Embassy in Korea
1. Subject: IT trade surplus sets new record
Date: November 8, 2010
Source: JoongAng Daily
Korea’s trade surplus in the information technology sector reached a record of $7.2 billion last month, the Ministry of Knowledge Economy said yesterday. IT exports rose 17.4 percent to $14.1 billion from a year ago, and imports jumped 22 percent to $6.9 billion. The previous surplus record had been set in August at $7.01 billion. IT exports hit a record high last month, breaking the previous record of $13.6 billion set in July. Total IT exports from January to October were $127.4 billion.
“The on-year increase in IT exports last month was mainly led by high overseas demand in cell phones, semiconductors and personal computers,” the ministry said yesterday. The volume of semiconductor exports increased 33 percent year-on-year in October to $4.6 billion. Cell phone exports also posted growth of 2.1 percent for the first time this year. Exports of computer and related components increased 11.1 percent on-year to $730 million, led by more exports of personal computers. By region, exports to the United States jumped 42.2 percent to $1.93 billion, boosted by higher demand for cell phones, which increased 40 percent year-on-year. IT exports to China increased 17.1 percent to $6.02 billion, while exports to Asean countries surged 19.1 percent to $1.26 billion. IT exports to Japan and the EU jumped 11.3 percent and 3.3 percent, respectively, to $710 million and $1.9 billion. The 22 percent increase in Korea’s IT imports to $6.9 billion was mainly led by domestic demand for electronics components (up 17 percent), computer and related devices (up 26.3 percent) and cell phones (up 93.3 percent). Imports increased mainly from China, Singapore and Taiwan.
“Though the current surge in the volume of Korea’s IT exports is expected to slow due to concerns on stagnant economic conditions of major IT trading countries ... growth is to continue as exports of cell phones, mainly led by smartphones, is on a recovery trend,” the ministry said
2. Subject: Korea IMF quota set to rise to 1.8%
Date: November 8, 2010
Source: Hankyung Newspaper
Korea will have a bigger voice at the International Monetary Fund, as the organization is expected to increase the country’s quota share from the current 1.41 percent to 1.8 percent as part of an adjustment that gives a greater say to emerging countries. The quota change will result in Korea becoming the 16th biggest voting power among the IMF’s 187 member nations, up two notches from 18th. Korea will increase its contribution to the IMF from $5.3 billion to $13.5 billion.
The IMF executive board met on Friday, Washington time, to approve the readjustment of the quota system based on an agreement reached by the G-20 finance ministers and central bank governors in Gyeongju last month. The IMF will transfer 6 percentage points of the quota from developed nations to emerging countries, including China, India and Turkey. This was a bigger allotment than that proposed at the G-20 Summit in Pittsburgh in September 2009, when it was decided that a quota shift would amount to 5 percentage points. This is the first change in the IMF quota structure in 12 years. “This historic agreement is the most fundamental governance overhaul in the Fund’s 65-year history,” Dominique Strauss-Kahn, IMF managing director said in a statement on Friday. The proposal will be voted upon by the 187 member nations by Dec. 15 and will be implemented once it receives by 85 percent of the IMF board. The proposal also needs to be approved by national legislatures. Along with Korea, quota shares for other emerging nations will increase, including China, which will see its quota raised from 4 percent to 6.39 percent, allowing the country to rank as the third-biggest power after the United States with 17.41 percent and Japan with 6.46 percent. The quota for Brazil, Russia and India were increased by 0.53, 0.21, and 0.31 percentage points, respectively. This means the so-called BRIC countries will have combined total of a 14.17 percent quota, allowing them to veto proposals with the aid of other emerging nations. The quotas for other nations, including Saudi Arabia, Belgium, Germany and Canada will fall.
3. Subject: Cold spell has cash registers ringing
Date: November 9, 2010
Source: Mail Economic Newspaper
With winter-like weather disguising the fact that it’s still just the middle of autumn, consumers are scrambling to battle the chill by stocking up on everything from coffee cup warmers and blankets to heavy jackets and boots. It’s welcome news for local retailers, which are seeing a solid spike in sales of winter items. In fact, last month’s unexpected drop in temperatures helped fuel overall revenue growth at local department stores, according to industry data.
Lotte Department Store said its sales rose 22.7 percent in October versus the same month a year earlier, driven by an uptick in demand for winter items. Sales of outdoor apparel, for instance, jumped 41.7 percent at Lotte outlets open longer than a year, followed by a 31.5 percent increase in sportswear and a 30.5 percent rise in fur items.
Hyundai Department Store, the nation’s third-biggest department store, also saw its monthly revenue rise 23.1 percent over October of last year. Although junior women’s fashion items racked up the biggest gains, with sales ballooning 45 percent, revenue for outdoor items - including coats, gloves and other winter apparel - increased 38 percent as well. Retailers are now offering sales and discounts on warm clothing to coincide with the weather. Lotte Department Store and other retailers are offering discounted Polham down vests for 79,000 won ($71.34). Hyundai Department Store’s Joongdong outlet in Bucheon is holding a sale on outdoor winter apparel through Thursday, cutting prices on brands such as Millet, Eider and Aigle. And Shinsegae Department Store’s flagship outlet at Myeong-dong, central Seoul, has cut the prices of wool boots through Thursday. Other upscale retailers are offering sales on a variety fur items. Galleria Department Store’s online shopping site, for instance, is running a sale that includes Dongwoo Mink shawls for 2.3 million won and Taerim mink vests for 2.6 million won. Discount store chains are offering a variety of products to help customers get toasty at home. Lotte Mart is selling polar fleece blankets in a variety of colors and sizes for 4,800 won to 6,800 won. Polar fleece, according to the company, retains warmth well while being both lighter and more competitively priced than blankets made from super-fine fibers.
E-Mart, the largest domestic discount store chain, is marketing “super-light down jumpers” from private label Daiz. Adult sizes cost 39,000 won, while jumpers for children are on sale for 35,000 won. Long, faux-wool boots are also available for 13,900 won - a relative steal compared to the real thing. Other retailers and online sites are focusing on items to help keep the working world warm in the office. The online site Auction, for instance, is selling a cup warmer that utilizes a USB connection for 5,900 won. It’s also selling a foot warmer that plugs into a USB port for 4,900 won.
Left, a Polham down vest on sale at Lotte Department Store. Right, a Dongwoo Mink shawl offered at Galleria Department Store’s online site. Provided by the companies
4. Subject: G20 to push current balance guidelines
Date: November 12, 2010
Source: Korea Herald
Group of 20 leaders agreed Friday to prepare early warning indicators to curb excessive current account imbalances by next June to prevent instability worsening in the global economy. But they failed to agree on the U.S. proposal to adopt a specific numerical cap on the ratio between current account surplus or deficit and GDP in the face of opposition from China, Germany and other major export-driven economies. In a watered-down agreement, leaders said their finance ministers and the International Monetary Fund would draw up indicative guidelines on excessive imbalances next year.
G20 leaders wave during a group photo session held after their summit on the world economy in COEX in Seoul on Friday. (Chung Hee-cho/The Korea Herald)
“These indicative guidelines composed of a range of indicators would serve as a mechanism to facilitate timely identification of large imbalances that require preventive and corrective actions to be taken,” the G20 leaders’ statement said after their two-day meeting in Seoul. They said the first assessment will be initiated and undertaken in due course under the French presidency of the summit next year. France formally took on the G20’s rotating presidency at the end of the G20 summit in Seoul. The 2011 summit will be held in Cannes on Nov. 3 and 4.
“It is a remarkable progress that we agreed on a detailed schedule for the indicative guidelines to maintain balanced current accounts,” President Lee Myung-bak, host of the Seoul summit, said during a joint press conference. “If they are implemented as agreed, it would greatly contribute toward preventing a global economic crisis. We all have to cooperate for this.” Concerning the currency issue, they agreed to move toward more market-determined exchange rate systems, enhancing exchange rate flexibility to reflect underlying economic fundamentals and refraining from competitive devaluation of currencies. The leaders affirmed their finance ministers’ agreement that advanced economies, including those with reserve currencies, would be vigilant against excess volatility and disorderly movements in exchange rates. “These actions will help mitigate the risk of excessive volatility in capital flows facing some emerging countries,” their joint declaration said. U.S. President Barack Obama hailed the outcome of the summit. “What remarkable is it that we actually made real progress,” he said during a press conference. U.K. Prime Minister David Cameron said: “This time, we are not meeting with the same sense of crisis, so it makes it more difficult.” They pledged to continue with coordinated efforts and act together to generate strong, sustainable and balanced growth. They said G20’s relentless and cooperative efforts over the last two years have delivered strong results but the world still faces risks. “Some of us are experiencing strong growth, while others face high levels of unemployment and sluggish recovery. Uneven growth and widening imbalances are fueling the temptation to diverge from global solutions into uncoordinated actions. However, uncoordinated policy actions will only lead to worse outcomes for all,” it said. The leaders adopted the Seoul Action Plan composed of comprehensive, cooperative and country-specific policy action. The plan called for the nations to undertake macroeconomic policies, including fiscal consolidation where necessary. Regarding the issue of financial reform, the Seoul declaration progressed further from Gyeongju accord and agreed to “conduct rigorous risk assessment on these firms (Systematically Important Financial Institutions) through international supervisory colleges.” The G20 leaders also pledged to continue to resist all forms of protectionism and seek to make significant progress to further reduce barriers to trade. “We will refrain from introducing, and oppose protectionist trade actions in all forms and recognize the importance of a prompt conclusion of the Doha negotiations.” They adopted the Seoul Development Consensus for Shared Growth that sets out their commitment to work in partnership with other developing countries to help them build the capacity to achieve and maximize their growth potential, thereby contributing to global rebalancing. The Seoul Consensus complements our commitment to achieve the Millennium Development Goals and focuses on concrete measures as summarized in an multi-year action plan on development to make a tangible and significant difference in people’s lives, including through the development of infrastructure in developing countries, it said. 5. Subject: In new SSM law, a truce but not peace - ‘Many of our members are already jobless due to corporate retail stores taking away livelihoods.’
Date: November 14, 2010
Source: Yonhap News
Incheon Complex Fish Market was bustling with solicitous merchants and customers. But behind what is an everyday scene at traditional markets, small-scale merchants are fighting for their livelihoods against large corporate chains determined to take away market share. The protracted friction within the retail industry recently met a solution of sorts, as a law barring the opening of so-called super-supermarkets (SSMs) near traditional markets was approved last week after more than a year of intense debate between small-scale merchants and corporate retail chains. Reactions within the industry vary. But the solution is far from definitive - as a second law regulating SSMs is set to pass later this month, and small business merchants work to deter the opening of other corporate retail chains not covered by the law. On Nov. 10, the National Assembly finalized a long-delayed revision of the Retail Industry Development Act. According to the new law, discount stores spanning over 3,000 square meters (32,300 square feet) or super-supermarkets defined as corporate-run markets between 1,000 and 3,000 square meters, will not be able to open a new outlet within a 500 meter radius (1,640 feet) of a traditional market or shopping district. This is no small deal. There are 1,550 traditional markets and 39 traditional shopping districts in Korea that could be deemed SSM-free zones, and the Ministry of Knowledge Economy estimates that the prohibited area for new SSMs will reach 31.2 percent of the nation’s commercial district areas. Representatives of small-scale merchants say that this law couldn’t have been passed too soon. “Small-scale merchants have been protesting large retail chains for six years, and laws reflecting their position had not passed until now,” said a representative of the small merchant support department at Korea Federation of Small and Medium Business. On the other hand, reactions from the super-supermarkets were mostly measured, as the passage of the law had been expected. “Everyone knew this law will be formally passed. We will continue to operate normally within the boundary of the law,” said Choi Hyun-joo, a PR representative of Lotte Super, the largest super-supermarket chain in both revenue and number of stores. However, there are signs that disputes between small merchants and corporate chains will continue. In front of the Gangseo District Office building in Seoul yesterday, a group of individual supermarket workers from the Southwestern Seoul Supermarket Association took turns standing guard to keep a GS Retail store from opening. “After we stopped them from putting up the store sign and moving in a few days ago to avoid being regulated by the new law, they’re now trying to change the store from an SSM to a convenience store to avoid being eligible for arbitration by merchants,” said Lee Yoon-geun, head of the association. “Many of our members are already jobless due to corporate retail stores taking away our livelihoods. I can’t help but think that [the law] is too late.” Although traditional markets are protected under the Nov. 10 revision, the super-supermarkets are barred from opening their doors only after the head of a local government designates the protected area, so there’s still some time from actual enforcement, said the Kbiz representative. Moreover, the Nov. 10 revisions are not the final word. A second set of laws regulating SSMs are slated to be passed on Nov. 25. Dubbed the “coexistence law” after a keyword pushed by the current administration in reconciling big business and smaller enterprises, it will allow for arbitration by the government.
Large retail chains have their own grievances. “It is unfortunate that the official criteria have skewed toward merchants without taking the customers’ position into account,” said Choi, the Lotte Super PR representative. Some traditional markets are successfully uniting and systemizing to achieve economies of scale. Back in the Incheon Complex Fish Market, there was an unbroken procession of customers. This 700-store, 2,000-merchant-strong traditional market has not yet felt the SSM blues. The market boasts 5,000 to 6,000 customers on a weekday, and 30,000 on a weekend. It has kept its wholesale heritage as well as reinforced competitiveness by instituting new customer-centered practices like organizing similar stores into departments, ready acceptance of gift certificates and strengthening its specialty - fish. “We are a traditional market with our strong suit being in wholesale, and retailers cannot match our specialization in marine products,” said Lee Seung-bou, the head of the merchants’ association that runs the market.
6. Subject: Import prices rise for 7th consecutive month
Date: November 15, 2010
Source: Hankyung Economic
Korea’s import prices increased in October from a year ago mainly due to rising oil prices, marking the seventh consecutive monthly gain, the central bank said yesterday. In local currency terms, prices of imported goods and materials gained 8.1 percent last month compared with the same month last year, the Bank of Korea said in a monthly report. The October gain marks a faster pace than 7.8 percent on-year growth in September. Compared with September, however, import prices declined 0.9 percent last month after staying flat the previous month, it said. The central bank said the October on-year increase is largely attributable to rising oil costs. Petroleum represents the bulk of imports in Korea, which almost entirely relies on inbound shipments for its oil needs. The prices of imported raw materials, including oil, spiked 15 percent last month compared with a year earlier, the bank said. “Prices of oil and other nonferrous metals are on the rise in year-on-year terms as the world economy emerged from the global economic crisis and more investors chose these assets as an alternative to a weak U.S. dollar,” a BOK official said. The results came ahead of the central bank’s decision to leave its key interest rate unchanged on Tuesday. It has left its base rate at 2.25 percent for the third month in October after raising it by 0.25 percentage points from a record low in July.
Source : http://www.depthai.go.th