Market Feasibility

A. Country Profiling

          

  South Korea is a stable, highly developed, democratic republic with powers shared between the president and the legislature. Tourist facilities are widely available and it has a modern economy. http://travel.state.gov/travel/cis_pa_tw/cis/cis_1018.html

Political and Legal Highlights

           

               The President is the head of state Republic of Korea, who is elected by direct popular vote for a single five-year term. The President appoints the Prime Minister with approval of parliament and supervises over the State council or cabinet. The president is also the commander-in-chief of the armed forces and is the highest representative of the republic.

            

            The members of the National Assembly or Kukhoe which is the unicameral Korean parliament serve a four-year term of office. At present, the legislature has 299 seats, of which 243 are elected by regional vote and the rests are allocated by the relative representation ballot. The Supreme Court is the highest judiciary body wherein justices are employed by the president with the approval of the parliament.

http://en.wikipedia.org/wiki/South_korea

Economic Highlights

             Since the early 1960s, South Korea’s economy had undergone an extraordinarily fast industrialization usually based on agriculture.  http://www.mapzones.com/world/asia/south_korea/economyindex.php

           

           Korea’s growth and constancy have brought it a voice in the future of world economic development as the world’s 12-th largest economy. http://www.korea.net/news/news/newsView.asp?serial_no=20041013021&part=112&SearchDay=

Table 1

Economic Indicator: 1998-2003

	1998	1999	2000	2001	2002	2003
South Korea
Inflation  (% change)	7.5	0.8	2.2	4.1	2.7	3.6
Exchange rate (per US$)	1,401.44	1,188.82	1,130.96	1,290.99	1,251.09	1,191.61
Interest rate	15.3	9.4	8.5	7.7	6.8	6.2
GDP (% real growth)	-6.9	9.5	8.5	3.8	7	3.1
GDP (national currency millions)	484,103,000	529,500,000	578,665,000	622,123,000	684,263,000	721,346,000
GDP (US$ millions)	345,432.60	445,399.60	511,658.20	481,896.10	546,933.50	605,354.10

Source: Euromonitor

In 2003 the GDP grew by around 3.1% and in 2004 the growth of 5.5% is expected. The growth of 5.3% was forecasted in 2005. In 2003, inflation was 3.5& and in 2004 the inflation should be 3.7%. The prices were forecasted to rise by 3.4% in 2005. After a household credit boom came to an end and some very old structural problems reappeared, the economy caught during the first half of 2003. The recovery relies heavily on rolling exports even though the growth has now restarted and while domestic demand stayed subdued. The authorities used macroeconomic policies to maintain the economy as growth slowed. The fiscal policy was relaxed and the monetary policy was eased. In the latter part of 2003 an export-led recovery began.

                

               For the year the net exports posted strong growth of 90.6% and on the GDP growth it contributed 208 percentage points, but the private consumption declined by 1.4%.

           

Other Economic Indices

Table 2

Consumer Expenditure by Purpose 1990-2010

						growth
Won Billion	1990	1995	2000	2005	2010	1990/2010
Food	18,959	34,952	47,434	61,436	75,075	295.99%
Alcoholic drinks	818	1,556	2,491	3,327	4,066	397.07%
Tobacco	1,672	3,084	4,458	5,510	6,419	283.91%
Clothing and footwear	4,522	11,757	11,386	14,430	17,088	277.89%
Housing	9,708	24,058	38,790	48,363	53,887	455.08%
Household fuels	2,975	7,181	11,398	14,879	18,333	516.24%
Household goods and services	5,830	12,127	13,599	18,211	22,713	289.59%
Health goods and medical
services	6,100	13,411	21,437	27,960	34,371	463.46%
Transport	12,114	25,459	36,700	48,444	60,273	397.55%
Communications	1,305	4,636	13,060	17,659	21,690	1562.07%
Leisure and recreation	8,045	18,125	21,620	n/a	n/a	n/a
Education	4,006	9,196	14,543	n/a	n/a	n/a
Hotels and catering	7,179	14,281	19,425	25,276	30,873	330.05%
Other items	7,904	21,807	34,497	43,192	55,030	596.23%
TOTAL	91,138	201,630	290,839	376,118	458,456	403.03%

Source: Euromonitor

            The consumer expenditure on food in South Korea in the year 2000 amounted to 47,474,000,000. By the year 2010, the growth on consumer expenditure on food will be 295.99%. Food being the top highly consumable activity has an increasing development in the South Korean Market.

Euromonitor Global Market Information

Economic Highlights

            Since the early 1960s, South Korea’s economy had undergone an extraordinarily fast industrialization usually based on agriculture.  http://www.mapzones.com/world/asia/south_korea/economyindex.php

            Korea’s growth and constancy have brought it a voice in the future of world economic development as the world’s 12-th largest economy. http://www.korea.net/news/news/newsView.asp?serial_no=20041013021&part=112&SearchDay=

Table 1

Economic Indicator: 1998-2003

	1998	1999	2000	2001	2002	2003
South Korea
Inflation  (% change)	7.5	0.8	2.2	4.1	2.7	3.6
Exchange rate (per US$)	1,401.44	1,188.82	1,130.96	1,290.99	1,251.09	1,191.61
Interest rate	15.3	9.4	8.5	7.7	6.8	6.2
GDP (% real growth)	-6.9	9.5	8.5	3.8	7	3.1
GDP (national currency millions)	484,103,000	529,500,000	578,665,000	622,123,000	684,263,000	721,346,000
GDP (US$ millions)	345,432.60	445,399.60	511,658.20	481,896.10	546,933.50	605,354.10

Source: Euromonitor

In 2003 the GDP grew by around 3.1% and in 2004 the growth of 5.5% is expected. The growth of 5.3% was forecasted in 2005. In 2003, inflation was 3.5& and in 2004 the inflation should be 3.7%. The prices were forecasted to rise by 3.4% in 2005. After a household credit boom came to an end and some very old structural problems reappeared, the economy caught during the first half of 2003. The recovery relies heavily on rolling exports even though the growth has now restarted and while domestic demand stayed subdued. The authorities used macroeconomic policies to maintain the economy as growth slowed. The fiscal policy was relaxed and the monetary policy was eased. In the latter part of 2003 an export-led recovery began.

For the year the net exports posted strong growth of 90.6% and on the GDP growth it contributed 208 percentage points, but the private consumption declined by 1.4%.

           

Other Economic Indices

Table 2

Consumer Expenditure by Purpose 1990-2010

						growth
Won Billion	1990	1995	2000	2005	2010	1990/2010
Food	18,959	34,952	47,434	61,436	75,075	295.99%
Alcoholic drinks	818	1,556	2,491	3,327	4,066	397.07%
Tobacco	1,672	3,084	4,458	5,510	6,419	283.91%
Clothing and footwear	4,522	11,757	11,386	14,430	17,088	277.89%
Housing	9,708	24,058	38,790	48,363	53,887	455.08%
Household fuels	2,975	7,181	11,398	14,879	18,333	516.24%
Household goods and services	5,830	12,127	13,599	18,211	22,713	289.59%
Health goods and medical
services	6,100	13,411	21,437	27,960	34,371	463.46%
Transport	12,114	25,459	36,700	48,444	60,273	397.55%
Communications	1,305	4,636	13,060	17,659	21,690	1562.07%
Leisure and recreation	8,045	18,125	21,620	n/a	n/a	n/a
Education	4,006	9,196	14,543	n/a	n/a	n/a
Hotels and catering	7,179	14,281	19,425	25,276	30,873	330.05%
Other items	7,904	21,807	34,497	43,192	55,030	596.23%
TOTAL	91,138	201,630	290,839	376,118	458,456	403.03%

Source: Euromonitor

            The consumer expenditure on food in South Korea in the year 2000 amounted to 47,474,000,000. By the year 2010, the growth on consumer expenditure on food will be 295.99%. Food being the top highly consumable activity has an increasing development in the South Korean Market.

Euromonitor Global Market Information