Global Supply Chain Restructuring... This Year's Promising Countries for Overseas Expansion Are 'Here'

Six Promising Countries Selected for Overseas Expansion by the Ministry of Trade, Industry and Energy and KOTRA
India, Malaysia, Uzbekistan, UAE, Germany, and Italy

The global supply chain restructuring is accelerating due to the tariff policies of the Trump administration. Six promising countries have been identified where Korean companies seeking new markets to avoid geopolitical risks can expand.

The Ministry of Trade, Industry and Energy and the Korea Trade-Investment Promotion Agency (KOTRA) announced on the 3rd that they published the report "6 Promising Countries to Watch for Entry in 2025," which summarizes export opportunities in six promising export countries following the government's February inter-ministerial emergency export measures. This considered the situation where the new U.S. administration has successively announced tariff policies, reshaping the existing trade order. KOTRA included in the report entry strategies to find markets that Korea can target not only in leading countries of the global South but also in advanced countries with stagnant growth for pioneering new markets.

◆ India, emerging as a 'global manufacturing hub' = India's large-scale infrastructure development, representing the rapidly growing global South, signifies definite market opportunities. The Indian government invested 100 trillion rupees (approximately 1,658 trillion KRW) according to the "Infrastructure Revival Plan" announced in August 2021. Various projects such as ▲urban infrastructure (water supply, sewage, and waste treatment) ▲road connectivity ▲airport construction are underway. KOTRA analyzed that Korean companies need to focus on demand for construction equipment and power materials and show interest in local market entry.

◆ Malaysia, aspiring to be a 'data hub' in the AI era = Malaysia, which attracted investments worth about 23 trillion KRW from global leading companies such as Google and Amazon, is actively strengthening its AI infrastructure. Based on ▲low electricity costs ▲favorable geographical location ▲government incentives, the AI data center ecosystem is rapidly growing. In addition to the sixfold increase in Korea's exports to Malaysia last year, including computer recording media, demand for new technology services such as data center management, security, and virtualization is expected to continue.

◆ Uzbekistan, emerging as a 'Eurasian entry base' = The shift in the Central Asian automobile industry landscape after the Russia-Ukraine war is also a notable opportunity. Uzbekistan is rising as a key hub in the Eurasian region. Due to the prolonged Ukraine war, demand for Russian-made cars is shifting to Central Asian production, aiming to produce up to 1 million units by 2030. Accordingly, technological cooperation and equipment transfer in the automobile manufacturing sector are expected to become active, expanding the market and increasing opportunities for corporate entry.

◆ UAE building new growth engines beyond oil = The United Arab Emirates (UAE) is pursuing industrial diversification based on logistics, tourism, and AI industries to move away from an oil-centered economic structure. In particular, expansion of renewable energy and nuclear industries is expected due to ▲tourism industry ▲urban development ▲energy diversification efforts, creating new market demand.

◆ Energy and production structure improvement in Germany and Italy = The report also identified Germany and Italy as promising countries where a win-win strategy can be pursued through supply chain diversification and industrial innovation partnerships. Despite economic downturns, the automation-related industries in these two leading European manufacturing countries are expected to grow steadily at an average annual rate of 3.51% until 2030. In an environment where efforts to diversify supply chains are underway, energy diversification and expanding demand for industrial automation can create a positive environment for Korean companies to enter the local market.

KOTRA diagnosed that the current global market is mixed with uncertainties and new growth engines, stating, "The trend is shifting from a 'norm-based' system centered on the World Trade Organization (WTO) to a 'self-interest' centered system such as supply chain blockades." It added, "With the spread of generative AI and growth of the global digital market, opportunities for innovation are also being discovered," and analyzed that "the global South has also emerged as a new growth engine of the world economy."