Overview of the food industry​

The food manufacturing industry’s sales stood at KRW 122 trillion in 2018. When including the food service/restaurants industry sales (KRW 138 trillion), overall sales of the food industry amount to approximately KRW 260 trillion, and it is growing at a steady pace.​

Trends and prospects​​

• As for the food manufacturing industry, real GDP is estimated to have grown by 2.2% compared to the same period last year, and annual sales are estimated to have increased by approximately 2.5%. This shows that the domestic food manufacturing industry has performed relatively well despite the spread of COVID-19.
• In the food manufacturing industry, processed meat products, other foods, and processed fruits and vegetables were active in terms of shipments, but the distribution of oils and fats, processed fisheries products, processed dairy products, and beverages was more sluggish. In particular, the demand for other foods, such as noodles and functional health foods, has grown significantly in recent years.​
• The anticipated future conditions of the food industry are expected to include aging populations, an increase in single-person households, instability in international grain prices, and long-term effects from the ongoing COVID-19 pandemic. Nevertheless, sales of the food manufacturing industry are expected to continue their upward trend​

Source: Korea Rural Economic Institute​

Free Trade Zone tenant companies in the food industry

Overview of the textiles and apparel industry

The domestic textiles and apparel industry has 44,931 manufacturers (corporations with one or more employees) and 288,953 related companies, including companies in the textile and fashion wholesale/retail and service industries, contributing to the advancement of Korea’s national economy and daily living. The industry features a well-balanced foundation for production (yarn spinning, fabric production, dyeing, fashion apparel production, etc.) from upstream to downstream, and production technology has advanced evenly across the board. Also, in the case of apparel, the industry is focusing on high value-added functional fibers and eco-friendly fibers rather than mid-priced/low-priced general-purpose products. Furthermore, the apparel industry is advancing its technology and level of commercialization to develop and expand its production of new fibers (industrial fibers, etc.).

Trends and prospects

• The textiles and apparel industry is in the process of developing and commercializing various eco-friendly textile materials to secure its sustainability moving forward. Notable examples include natural fiber-based composite materials, recycled fiber materials, and biodegradable fiber materials. Moreover, markets related to these materials are growing steadily as well.​​
• In order for these textile materials to be directly applied to products in the textiles and apparel industry, there are still some technical and industrial challenges that need solving. Also, industry stakeholders across the globe must continue to improve and refine relevant regulations and policies.
• Fortunately, companies in the domestic textiles and apparel industry are working in tandem with the central government and local municipalities to overcome present limitations and embark on collaborative projects.

Source: Korea Federation of Textile Industries​

Free Trade Zone tenant companies in the textiles and apparel industry​​​

Overview of the paper and printing industry​

The paper/printing industry is an essential material industry for production activities and cultural life, and as a core medium for preserving and disseminating knowledge and information, the level of a country’s printing technology is directly related to the level of that particular country’s culture and knowledge-based industry.

Trends and prospects​​

• By standardizing the print production process, the paper and printing industry is maximizing its productivity and efficiency. In doing so, it is pushing ahead with strategic initiatives that can help standardize print quality, develop eco-friendly printing products and printing processes, and innovate technologies, all of which can lay the foundation in transforming the paper and printing industry into a cutting-edge, high-tech industry.​
• In the paper industry, new applications for paper that differ from existing uses for paper are being developed. For instance, companies are developing special functional paper that can facilitate the commercialization of IT convergence technology or core materials that can be used in high-tech industries. Fundamentally, paper is a reusable and recyclable raw material. With technological innovation, global paper manufacturers are making various efforts to improve the environment taking advantage of paper’s unique eco-friendly characteristics.​

Source: Korea Labor Institute, Korea Paper Association

Free Trade Zone tenant companies in the paper and printing industry​​​

Overview of the petrochemical industry​

The petrochemical industry uses petroleum products such as naphtha or natural gas as raw materials to produce basic oils such as ethylene, propylene, benzene, and toluene. In addition, it is an industry that manufactures synthetic resins (plastics), synthetic fibers (polyester, nylon, etc.), synthetic rubber, fine chemical intermediates, and chemical products using basic oil as a raw material. Also, 70% of personal belongings people use, such as clothing, mobile phones, and bags, are made up of petrochemical products, so the petrochemical industry is indispensable to day-to-day life. Furthermore, it is an industry that is taking the lead in protecting the environment by replacing natural materials such as wood and natural fibers at low costs.

Trends and prospects​​

• The domestic petrochemical industry has maintained a favorable business condition for the past four years thanks to increased global demand and low oil prices despite intensifying protectionism and low growth in China, which is its main export destination. Korea’s petrochemical industry boasts the world’s fourth-largest production capacity when it comes to petrochemicals. Over the decades, it has continued to increase its production capacity by improving the efficiency of its processes and expanding its facilities.
• As for global demand, COVID-19 is expected to become less of a factor as vaccination rates go up in major countries. Thus, the conditions surrounding demand industries will see marked improvements, and thus, boost the demand for petrochemical products going forward. According to a report published by IHS, despite the impact of COVID-19, demand in the global chemical market is expected to continue on its upward trajectory until 2025.

Source: Korea Petrochemical Industry Association

Free Trade Zone tenant companies in the petrochemical industry

Overview of the medicine and pharmaceuticals industry

The medical/pharmaceuticals industry is a high value-added industry that directly affects human life and health, and as a knowledge-based industry, it is a high-tech and value-added industry that encompasses all processes, from the production and sale of raw materials and finished pharmaceuticals to researching and developing new drugs. In addition, the medical/pharmaceuticals industry is much more technology-intensive than other industries, and although it entails a long investment period and high risk along with a high degree of expertise, the industry is classified as a future growth industry because it can generate enormous high added value if it succeeds in developing a new drug.

Trends and prospects​​

• Korea’s medicine and pharmaceutical exports have continued to grow over the past five years at a rate of 16.1%, and in 2019, total medicine and pharmaceutical exports exceeded KRW 6 trillion for the first time ever.32) In 2020, Korea broke through into the ranks of the top-20 in global medicine and pharmaceutical exports. It went from 22nd in 2019 to 19th in 2020, an indicator reflecting the country’s much-improved competitiveness in exports.​

Source: Korea Health Industry Development Institute​

Free Trade Zone tenant companies in the medicine and pharmaceuticals industry

Overview of the medical and precision equipment industry

The medical equipment industry uses technology from multiple fields related to the design and manufacturing of medical device products, and it is an applied technology field in which clinical medicine and engineering such as electricity, electronics, mechanical materials, and optics are converged together. Ultimately, it aims to improve the quality of human life through medical devices. Moreover, medical equipment are composed of various product groups, and are becoming increasingly complex and diversified with further technological advancements. In other words, the medical equipment industry is a multi-variety, small-volume production industry. As for lower-end (price-wise) or some select markets, specialized small and medium-sized enterprises (SMEs) lead the market, and high-end, high-value products are led by a small number of large companies.

Trends and prospects​​

• The medical equipment industry is developing based on advanced technology from Industry 4.0. At the same time, as the global healthcare paradigm shifts from disease treatment to rapid diagnosis, prevention, and monitoring due to pandemics like COVID-19, aging populations, and an increase in the number of chronic diseases, the potential for continued growth of the medical equipment industry is also growing.
• Meanwhile, the medical equipment industry is expected to grow in the diagnostic realm despite the development of a COVID-19 vaccine thanks to continued investment in R&D and the recruitment of new personnel in the field of in vitro diagnostic devices, which has grown rapidly due to the spread of COVID-19. Moreover, the importance of traditional medical devices such as digital X-rays and ultrasound scanners will continue to rise as well. Also, the pace at which the market is growing for home medical devices using wearables is quite remarkable. In addition, as the artificial intelligence technology that processes the data obtained through wearable devices advances, 3D printing technology to develop patient-specific medical equipment and the development of materials and parts are expected to improve.

Source: Korea Health Industry Development Institute​

Free Trade Zone tenant companies in the medical and precision equipment industry​

Overview of the plastic and rubber industries

The plastics industry can be divided in two ways: an industry that includes materials and processing industries, or an industry that includes the processing industry only. The former includes the base resin industry that produces raw materials for plastic products, the compound industry that produces composite materials by adding fillers and reinforcing materials to synthetic resins, and the processing industry that processes these materials to produce various types of products. Meanwhile, the latter includes the plastic product manufacturing industry that processes synthetic resins and compounds to produce plastic products (the latter constitutes the plastics industry according to the general national statistical classification). Unlike plastic, metal, and ceramic materials, the rubber industry is unique in that it produces a material that has a unique characteristic - elasticity. Rubber is a material that delivers superior performance in terms of sealing, elasticity, and shock absorption compared to other materials. Thus, the rubber industry is indispensable for the transportation industry, the electrical and electronics industry, the medical and biotechnology industry, the energy industry, the household goods industry, and the construction industry.

Trends and prospects​​

• Despite growing exports, the domestic production and utilization rate of plastic products is on the decline due to increased dependence on Japan for high-value-added products as well as the increase in imports of low-value-added products from China and Southeast Asia. These trends are being influenced by the rising dependence on imports from Japan mainly for plastic films, sheets, and plate products used for display production, and greater volume of imported plastic bags and packaging plastic containers from China and Southeast Asia.​​
• Domestic production and utilization rates of rubber products are on a precipitous decline due to a decrease in exports, mainly driven by the tire industry. The decline in rubber consumption stems from stagnating global finished car sales, decrease in domestic production of tires due to an increase in the market share of imported tires in the domestic automobile industry, and plummeting demand for tires that go on new cars as well as replacement tires due to the decline in global car sales and driving distance as a result of COVID-19.

Source: Korea Federation of Plastic Industry Cooperatives, Korea Institute for Industrial Economics and Trade​

Free Trade Zone tenant companies in the plastics and rubber industries

Overview of the metals and non-metals industries​

The metal and non-metal industries, as national key industries, have played a crucial role in providing basic materials for Korea's rapid economic growth. In particular, Korea's metal industry has maintained its world-class competitiveness since the 1970s thanks to the government's intensive support policy and the stable growth of demand industries such as automobiles and shipbuilding.

Trends and prospects​​

• In order to respond to future issues such as aging populations, abnormal climate due to global warming, increase in energy demand, deepening resource scarcity, and environmental conservation, research is being conducted to play a role as a core material for future technologies such as IT, bio-health, high-efficiency energy, and artificial intelligence in pursuit of advanced technology, convergence, and high added value.​
• More specifically, various studies, including research and development with currently ongoing materials and components technology development projects, development of high value-added special metal technology used in high value-added lightweight materials for lightening transportation equipment and engine material parts for aviation, research on resource circulation utilization technology of process by-products and waste materials, and research on low energy consumption and eco-friendly process technology for strengthening competitiveness in the steel industry through digital transformation, are under way at present.

Source: Korea Industrial Technology Association

Free Trade Zone tenant companies in the metals and non-metals industries

Overview of the automobile industry​

The automobile industry is the world's largest manufacturing industry with global sales exceeding USD 1 trillion and it employs more than 10 million people, playing a leading role in the economic growth of countries with their own automobile industry. The automobile industry stimulates production and distributes technology in new growth industries such as information technology (IT), biotechnology (BT), energy technology (ET), and environmental technology (ET) as well as traditional industries such as steel, machinery, and materials industries, which are its related industries. The automobile industry is also an industry where new technologies are applied the fastest and creates large-scale demand for new industrial sectors.​​​​​​

Trends and prospects​​

• In the global automobile market, production is declining due to production setbacks brought on by the resurgence of COVID-19 and the insufficient supply of semiconductors for vehicles. However, with the supply of vaccines in major countries and various economic stimulus measures, demand for cars is recovering. Thus, the sales volume in 2021 is seeing an uptick from the previous year.​
• The transition from internal combustion vehicles to eco-friendly vehicles is gathering more momentum as support for eco-friendly vehicles has been expanded as part of policies to strengthen carbon emission regulations and post-pandemic economic stimulus plans.​

Source: Export-Import Bank of Korea

Free Trade Zone tenant companies in the automobile industry

Overview of the shipbuilding industry​

The shipbuilding industry produces and sells vessels, and provides important technologies to overall national industries such as shipping and transportation, maritime development, and national defense construction. The entire industrial supply chain encompasses all of the important economic industries, from raw materials for steel production in the upstream, and various software as well as electronic components used in the shipping and logistics industry in the downstream.

Trends and prospects​​

• In the first half of 2021, the global shipbuilding and maritime industry witnessed its greatest recovery in recent years, and the recovery has led to some rapid growth. With the global economy on its way to recovery and increased orders from shipowners, fair winds are blowing in the shipbuilding industry. Some forecasts even say a supercycle (long-term boom) in the shipbuilding industry will start this year. As such, the market is keeping an eye on Korea and China, which rank first and second in global shipping market share.
• During the first half of 2021, the global economy saw a modest rebound thanks to greater COVID-19 vaccine supply and fiscal stimulus measures in a large number of countries. Buoyed by increasing demand for maritime trade, the global shipbuilding industry also recovered across the board, leading to a boom in the performance of major shipbuilders in Korea and China. With the oil and gas transportation and passenger ship markets expected to recover in the second half of the year, the upward momentum from the first half will most likely carry over to the second half.

Source: KOTRA

Free Trade Zone tenant companies in the shipbuilding industry

Overview of the machinery industry​​

The machinery industry is a high-value-added industry that not only has a large upstream and downstream ripple effect between industries as a supply industry for production facilities, but also has a large employment-inducing effect due to the differentiation of parts assembly and processing processes. The most notable characteristic of this industry is that there are various types of machines depending on the type, method, and place of use, so production tends to be small-lot and order-made. Recently, more efforts are being made to converge and integrate mechanical technology and electronic and information technology, and this is pushing the machinery industry to transform itself into a more knowledge-based industry.​

Trends and prospects​​

• With more stringent global greenhouse gas emission regulations on the horizon, environmental regulations are being actively promoted at the global level in the machinery industry. Efforts to green machine technology in anticipation of these low-carbon regulations are being carried out mainly in advanced countries, and this is expected to act as a barrier to entry into the machinery industry in emerging countries.
• In the machinery industry, the convergence with IT is accelerating - the industry is evolving from the “Mechatronics era” (1980~2010), to the “IT Machinery era” (2010~2040), and the “Intelligent Robot era (2040~).” The "Future Science and Technology in 2035" report, compiled by the Japanese Ministry of Education, Culture, Sports, Science and Technology, emphasizes the importance of convergence between manufacturing and IT from a short-term perspective of the next five to ten years. In particular, the report presents Japan’s goals in five major areas: advanced IT manufacturing technology; virtual design manufacturing technology; high value-added product manufacturing technology; nano-processing and micro-processing technology; and manufacturing-related human and robotics technology.

Source: Korea Institute for Industrial Economics and Trade

Free Trade Zone tenant companies in the machinery industry​

Overview of the distribution industry​​​

The distribution industry is an industry that engages in the wholesale/retail of agricultural, forestry, livestock, fisheries products (including processed and cooked products), and industrial products, as well as the storage, delivery, and packaging, and provision of related information and services.

Trends and prospects​​

• Online shopping is growing rapidly due to an increasing number of consumers preferring more convenient modes of shopping. In particular, the proportion of mobile shopping has increased to more than half of all means of shopping.​
• Korea has the perfect environment for e-commerce. Korean consumers are highly accommodating to new technologies, and the Korean market has the best infrastructure for e-commerce; it was the first market in the world to provide 5G communication services, it offers great internet speed, and its smartphone penetration rate is among the highest in the world.

Source: KOTRA

Free Trade Zone tenant companies in the distribution industry​​

Overview of the logistics industry

The logistics industry is an industry that provides transportation, storage, unloading, packaging and other related services for a fee in response to the needs of others. It is divided into the cargo transportation business that transports cargo by rail, road, sea and air, the logistics facility operation business that supports and subsidizes the cargo transportation business, and the logistics service business.

Trends and prospects​​

• Until the 2000s, Korea's logistics industry grew significantly (quantitatively) due to its rapid economic growth and export-oriented economic structure. In the 2000s, it also grew qualitatively thanks to the rise of the Chinese market and the government's investment in logistics infrastructure (Incheon International Airport, Busan New Port, inland logistics bases, etc.).
• Currently, the logistics business trend is rapidly changing with the acceleration of Industry 4.0 using technologies such as IoT, 3D printing, autonomous vehicles, AI robots, drones, big data and cloud technologies. DHL (2016) forecasted the following as key logistics business trends following the innovations brought on by Industry 4.0: Predictive logistics; batch size one; convenience logistics; de-stressing the supply chain; process logistics; gray power logistics; logistics market platform; multi-purpose shared network; omnichannel logistics; on-demand delivery; sharing economy logistics; smart energy logistics; super grid logistics; and tube logistics.

Source: KOTRA

Free Trade Zone tenant companies in the logistics industry​

Overview of the energy industry​​

The energy industry is an industry facilitating the transition to a safe and clean new energy system centered on renewable energy and energy efficiency in response to the public demand for climate change response, fine dust reduction, and nuclear power plant safety.​

Trends and prospects​​

• The new and renewable energy industry is expected to be activated mainly by solar power, wind power, and hydrogen fuel cells. Large corporations and medium-sized companies are building a solar power-oriented market, and a number of small and medium-sized enterprises (SMEs) are helping production across the entire solar power value chain.
• According to the Korea Institute of Science and Technology Evaluation and Planning (KISTEP, 2018), the level of technology in the new and renewable energy sector in Korea is 86% (100% means the highest technology), meaning that it lags behind advance markets (Europe, USA, Japan) in terms of technology by roughly 10%.​
• The Korean government is aiming to raise renewable energy generation to 20% by 2030, and plans to supply more than 95% of newly installed facilities with clean energy. Moreover, in order to expand the demand for new and renewable energy, the Ministry of Trade, Industry and Energy has also raised its goal of new and renewable power supply (RPS) from 9% in 2022 to 10%.
• The biggest blow to global renewable energy demand is raw material prices. Excessive increase in raw material prices is expected to impact renewable energy demand negatively.​

Source: KOTRA

Free Trade Zone tenant companies in the energy industry​

Overview of the energy industry​​

The energy industry is an industry facilitating the transition to a safe and clean new energy system centered on renewable energy and energy efficiency in response to the public demand for climate change response, fine dust reduction, and nuclear power plant safety.​

Trends and prospects​​

• The new and renewable energy industry is expected to be activated mainly by solar power, wind power, and hydrogen fuel cells. Large corporations and medium-sized companies are building a solar power-oriented market, and a number of small and medium-sized enterprises (SMEs) are helping production across the entire solar power value chain.
• According to the Korea Institute of Science and Technology Evaluation and Planning (KISTEP, 2018), the level of technology in the new and renewable energy sector in Korea is 86% (100% means the highest technology), meaning that it lags behind advance markets (Europe, USA, Japan) in terms of technology by roughly 10%.​
• The Korean government is aiming to raise renewable energy generation to 20% by 2030, and plans to supply more than 95% of newly installed facilities with clean energy. Moreover, in order to expand the demand for new and renewable energy, the Ministry of Trade, Industry and Energy has also raised its goal of new and renewable power supply (RPS) from 9% in 2022 to 10%.
• The biggest blow to global renewable energy demand is raw material prices. Excessive increase in raw material prices is expected to impact renewable energy demand negatively.​

Source: KOTRA

Free Trade Zone tenant companies in other industries