“Cooperation with emerging countries and the Middle East…a new opportunity”- What is the real reason?

“We should seize the opportunity to collaborate with emerging countries such as ASEAN, India, South America, and the Middle East.”

On the 8th, Seo Jin-gyo, the head of the GS&J Institute, a trade expert, forecasted that the export conditions for the Korean economy, which is under the long-term low growth crisis, will improve next year compared to this year. Seo emphasized the importance of expanding exports of high-value-added services using intellectual property rights (IP) as a major task, stepping out of the sharp U.S.-China structure and into the third export zone. It means that we need to leapfrog our export competitiveness by establishing a ‘genuine cooperative relationship’ with them, not just a connection with the simple commodity market. He mentioned that it is necessary to develop a more expanded relationship by transferring some of our technology to them in line with the mid-to-long-term economic development direction of the Middle East and ASEAN regions, where it is difficult to expect national development with only oil money. Seo added, “In the era of autonomous electric vehicles, technologies like internal combustion engines can still be transferred sufficiently.”

He predicted that the U.S.-China relationship will also improve somewhat next year. Seo said, “The U.S. needs a fiscal policy ahead of next year’s election,” and “It needs to raise funds through national debt issuance, which will be an incentive to improve relations with China.” He also said, “Xi Jinping also has no reason to escalate tensions when considering his country’s deteriorating economy.” It reflected the forecast that the export conditions to China could be partially alleviated.

However, it was also predicted that the change in this structure could be a blow to the domestic semiconductor industry depending on the direction of future sanctions. Kim Yang-paeng, a senior researcher at the Industrial Research Institute, said, “The U.S. is delaying China’s semiconductor roll-out with policies such as semiconductor equipment regulation and decoupling aimed at containing China,” and “We need to maintain our competitiveness in memory semiconductors while expanding our tasks to include system semiconductors equipped with artificial intelligence (AI).”

In relation to the fact that Korea’s potential growth rate is tumbling due to the ‘0 birth rate’ shock, opinions were also raised that the expansion of family-friendly management and the restructuring of regions are urgent. Professor Jung Jae-hoon of the Department of Social Welfare at Seoul Women’s University emphasized, “Long-term education reform and a universal social security system for the (collapsing) middle class are important tasks.”