December 19 'ASEAN Investment Seminar and Expo Year-End Meeting'
27% Increase in Investment in Greater ASEAN Over 3 Years... Supply Chain Rapidly Emerging
295 Trillion Infrastructure Market to be Established by 2030... "Greatest Opportunity"
Huh Chang-soo, Chairman of the Federation of Korean Industries and CEO of GS Engineering & Construction. (Photo by Federation of Korean Industries)
[Asia Economy Reporter Moon Chaeseok]
"ASEAN (Association of Southeast Asian Nations) is South Korea's second-largest trading partner. Over the past decade, more than 80% of South Korea's newly established overseas subsidiaries have been set up in ASEAN countries, highlighting the region's importance."
Huh Chang-soo, Chairman of the Federation of Korean Industries (FKI), highly praised ASEAN's value as an alternative supply chain and investment destination during his remarks on the 19th. He also appealed for support in South Korea's bid to host the 2030 Busan World Expo.
The FKI announced that on the 19th, it held the "ASEAN Investment Seminar and 2030 Expo Bid Year-End Meeting" at the FKI Conference Center in Yeouido, Seoul, inviting ambassadors from ASEAN countries to South Korea. After providing information on ASEAN infrastructure investments at the year-end event, a dinner meeting was held to wish for the successful hosting of the 2030 Busan Expo.
The event was attended by ambassadors from the 10 ASEAN countries to South Korea and diplomats in charge of investment. Participants included Nguyen Vu Tung, Ambassador of Vietnam to South Korea; Gandhi Sulistiyanto, Ambassador of Indonesia to South Korea; Eric Teo, Ambassador of Singapore to South Korea; Maria Teresa Dizon-De Vega, Ambassador of the Philippines to South Korea; among other ASEAN ambassadors and investment diplomats.
From South Korea, over 40 CEOs and executives from major companies such as POSCO, GS Construction, Korean Air, LG CNS, LX International, Hanwha Techwin, Doosan Enerbility, Daewoo Construction, POSCO International, E1, Hyundai Engineering, Hanwha Life, Hana Financial Group, Shinhan Financial Group, CJ Logistics, Kyungbang, KCC Glass, KBI Group, Chong Kun Dang, SM Group, and Daesung Industrial attended, including Chairman Huh.
In his dinner speech, Chairman Huh said, "For South Korea, which is facing difficulties such as the US-China trade conflict, labor shortages, and resource concentration in some countries, ASEAN is a good solution. For ASEAN, which requires large-scale investment and advanced technology support for economic development, South Korea will be the optimal partner."
He continued, "I ask the ASEAN ambassadors to support South Korea's bid for the 2030 Busan Expo," emphasizing, "The Korean business community is working with the government with all its might to secure the Expo hosting rights."
Earlier in October, the FKI toured the Jisu Village area in Jinju, Gyeongnam, where many of the major entrepreneurs who built South Korea into one of the world's top 10 economies were born. They requested support for the Expo from key ambassadors, including those from Brunei and Myanmar.
FKI Vice Chairman Kwon Tae-shin also stressed the importance of ASEAN. Vice Chairman Kwon said, "At a time when global economic uncertainty is increasing due to the US-China conflict and the Ukraine war, ASEAN is emerging as a stable supply chain alternative."
He added, "Various infrastructure projects actively underway in ASEAN countries present great opportunities for Korean companies. Expanding investments in traditional infrastructure such as ports, railways, and roads, as well as future-oriented infrastructure like smart cities, eco-friendly power facilities, and new capital city construction, are excellent business opportunities."
According to the FKI, South Korea invested a net total of $22.8 billion (approximately 29.6 trillion KRW) in ASEAN from 2019 to 2021. This amount increased by about 27% compared to $18 billion (approximately 23.35 trillion KRW) invested from 2016 to 2018.
ASEAN's value is also high from the perspective of supply chain diversification. Kim Heung-jong, President of the Korea Institute for International Economic Policy (KIEP), said in his presentation "Global Supply Chain (GSC) Changes and ASEAN," "In the era of US-China conflict, ASEAN is expected to emerge as a core region for changes in East Asian supply chains," advising, "South Korea needs to diversify supply chains in key and strategic industries with ASEAN."
Kim added, "The spread of regionalization in global value chains, changes in intra- and extra-regional trade patterns led by emerging countries within ASEAN, and changes in trade structures following US-China trade frictions are expected to expand ASEAN's role as a key hub in the East Asian regional value chain (RVC). The Indo-Pacific Economic Framework (IPEF), which includes seven ASEAN countries, is also likely to have a significant impact on changes in ASEAN supply chains."
IPEF was launched in May with participation from 13 countries including South Korea, the United States, and Japan. It is a consultative body responding to new trade agendas such as digital, supply chains, and clean energy. The seven ASEAN countries refer to Singapore, Brunei, Indonesia, Malaysia, the Philippines, Thailand, and Vietnam.
Kim said, "Due to China risks and US-China trade frictions, companies leaving China are rapidly entering ASEAN. We should utilize ASEAN as a market to replace or supplement sluggish trade with China by leveraging ASEAN's position as a global hub for intermediate goods trade."
Trade attach?s and investment agency officials from major ASEAN countries also presented their countries' infrastructure investment plans. Speakers included Hilmi Tanjuang, Head of the Indonesia Investment Coordinating Board (BKPM) Seoul Office; Derek Tangapan, Deputy Director of the Malaysia Investment Development Authority (MIDA) Seoul Office; Jose Dincsei, Economic Counselor at the Philippine Embassy in South Korea; Kritawat Mattayamongkun, Economic Counselor at the Royal Thai Embassy and Head of the Thailand Board of Investment (BOI) Seoul Office; and Bampettuan, First Secretary at the Vietnamese Embassy in South Korea.
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