Published : Oct. 3, 2013 - 19:32
SMBA chief Han Jung-wha
The Small and Medium Business Administration is seeking to help SMEs grow into global champions.
In an interview with The Korea Herald, SMBA chief Han Jung-wha disclosed its measures to support SMEs.
They included efforts to diversify export lines, support for finding new buyers through global business-to-business websites and the operation of a “global highway program” to nurture globally small but strong players.
Following are excerpts of the interview with SMBA administrator Han.
Korea Herald: The export situation for our SMEs is still not favorable due to the protracted global economic slowdown and advanced countries’ growing protectionism. How can SMEs overcome these challenges?
Han Jung-wha: Our nation’s market is small and we are heavily relying on trade with foreign countries. So it is a must for SMEs to promote globalization to prepare for a new trade environment, such as through expansion of free trade agreements. Our government is promoting various projects to support SMEs’ advance into global markets. In particular, we focus on expanding exports to more countries and helping them strengthen their overseas competitiveness.
Riding on hallyu fever, we are also seeking to help SMEs sell their business-to-consumer products in large markets such as the United States, China and India.
In another effort, we are sending delegations to markets and exhibitions in countries that have FTAs with Korea to promote our SME’s products and explore opportunities to find new buyers.
China is Korea’s largest trade partner and accounts for 23.8 percent of our exports. If Hong Kong is included, the figure rises to about 30 percent.
In response to China’s change in its economic policy, we are planning to target Chinese markets of consumption goods, and materials and parts for Chinese large companies, and infrastructure building in the country’s mid-west region.
In addition, through cooperation in the fields of trade and customs, we are trying to ease tariff barriers.
KH: What is the government’s plan to help SMEs diversify their export markets, which have concentrated on the U.S., China, Japan and the EU?
Han: As the delay in the economic recovery in advanced countries continues, emerging economies are rising as new global consumer markets. But our SMEs’ exports have been mainly made to our major trading partners and they have been slow to respond to the changing trade environment.
Accordingly, we feel they need to diversify their export markets to prepare for the rapidly changing global business environment and to manage risks.
For this, we plan to select strategic goods and promote tailored marketing tactics to find new markets in emerging countries. Our strategies also include sending trade delegations, advancing into major distribution networks and support for Korean SMEs’ efforts for localization.
KH: How is the SMBA supporting SMEs’ participation in overseas procurement markets?
Han: The SMBA is currently supporting SMEs to bid for foreign governments’ procurement projects. For instance, we send delegations overseas to pioneer their procurement markets, support language services at purchase negotiations and provide information and consulting on project bids.
KH: What are the government’s measures to vitalize SMEs’ exports through e-trade.
Han: Currently, world trade is changing from conventional methods to electronic ones. The global e-commerce market is rapidly growing, about 20 percent annually. Online business-to-consumer markets are also growing rapidly, becoming a newly huge export market for our SMEs. So we plan to actively support online exports, which are believed to be suitable for them when considering cost, time and human resources.
We will map out measures for the vitalization of online exports during the second half of this year and expand our support for SMEs’ efforts to find new buyers through global business-to-business websites including Alibaba.
KH: What is the SMBA’s global highway program?
Han: We have established a three-stage support system to foster our SMEs into global, hidden champions. The three steps are evaluation of global competitiveness, establishment of a road map and comprehensive support of R&D, marketing and finance.
Within this year, we plan to select about 100 companies and support them. We will also provide their success stories to start-ups to give other SMEs the chance to succeed as global companies.
By Lee Kwon-hyung (kwonhl@heraldcorp.com)