SEOUL, Aug. 21 (Korea Bizwire) – “Provided the current situation remains the same going forward, [industries] excepting a few such as semiconductors, general machinery and weapons manufacturing will lose market share. In particular, the automotive, shipbuilding, petrochemical, textiles, home appliances, and communications devices industries will see their respective global market share drop in 2025 compared to recorded figures in 2015 despite a diversity of efforts.”
The above is an excerpt from a report published by the Korea Institute for Industrial Economics and Trade. A closer look at the figures shows the expected market share of Korean companies in the future:
Industry Increases 2015 to 2025
- Semiconductors: 16.5 to 18.2 percent
- General machinery: 2.8 to 2.9 percent
- Weapons Manufacturing: 2.4 to 2.7 percent
Industry Declines 2015 to 2025
- Automotive: 3.8 to 5.2 percent
- Shipbuilding: 20 to 36.2 percent
- Petrochemical: 4.7 to 5.4 percent
- Textiles: 1.2 to 2 percent
- Home appliances: 2.5 to 3.1 percent
- Communications Devices: 20.5 to 24.2 percent
The report identifies flaws in domestic means of production and the delay in transition to new businesses as two primary anchors holding down the growth of key industries.
High labor costs, a limited domestic market and declining exports caused by the global economic downturn has made it clear that tried and tested strategies will no longer be the formula for future growth.
The rise of China and its subsequently improved economic standing will also make global competition a field fraught with greater difficulty.
The report outlines four courses of action that the major industries can implement:
- Increase domestic productivity by improving market conditions and regulating means of production
- Search for a new identity in the global value chain
- Implement a transition strategy away from “declining” businesses and towards new ideas and products
- Expand operations in the service and related industries
As an example of what the above implementations might look like, the automotive industry should rectify imbalances between the company and the labor force and introduce a concrete system guaranteeing fair wages.
With a rebound in fortunes likely, the shipbuilding industry should retain its core abilities as it continues its revival through an extensive restructuring process.
The report also calls for the government to implement fair and coherent policies and ensure the survival of industries undergoing restructuring.
Lina Jang (email@example.com)