Seventh EU Asia Top Economist Round Table

10 July 2015

@asiamatters_biz #TERT @asiabusinessweek

‘A New Era in EU Asia Economic Partnership’

10 July 2015Radisson Blu Royal Hotel, Dublin

A Business Perspective on the EU-Korea FTA and EU-Korea Trade

Sangwoo KimPresident of Corporate Affairs Europe, Samsung

EU-Korea Trade

Sangwoo KimPresident, Corporate Affairs Europe

Samsung Electronics

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77 Years old

USD 318 Billion Revenue (‘14)

USD 28 Billion Net income

67 Affiliated Companies- Electronics Industries- Machinery & Heavy Industries- Chemical Industries- Financial Services- Services and Others

673 Offices &489,000 EmployeesIn 90 countries

Since1938

46 Years old

USD 188 Billion Revenue (‘14)

KRW 23 Trillion Net income

220 Global Base &330,000 EmployeesIn 84 countries

3 Business Units- Consumer Electronics - Mobile Communications - Semiconductors

Since1969

Samsung at a Glance

SAMSUNG SAMSUNG ELECTRONICS

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Seoul in 1948

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Korean War in 1950

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Seoul today

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Last year, South Korea GDP was USD 1410.38bn – all time high so far

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Innovation Union Scoreboard 2015

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EU exports to Korea on the rise

Over the last dozen of years, EU28 exports to South Korea more than doubled

The overall progress in the country and the steadily growing buying power may be amongst the reasons for that growth

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EU – Korea FTA

The FTA entered into force in July 2011; it:

is the first of a new generation FTAs that goes further than any previous agreements in lifting trade barriers

is the EU's first trade deal with an Asian country

eliminates duties for industrial and agricultural goods in a progressive, step-by-step approach

on 1 July 2016, will eliminate import duties on all products except for a limited number of agricultural products

also addresses non-tariff barriers to trade with particular focus on the automotive, pharma, medical devices and electronics sectors

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EU – Korea FTA: several years later

Pretty good

Not so great

Not so bad

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EU – Korea FTA: not so bad

BUT since the 12-month period before the FTA took effect:

– EU exports of goods to Korea increased by 35%

– EU exports to Korea of fully or partially liberalised products grew more than the overall exports – by 46% and 37% respectively

– EU exports of motor vehicles to Korea increased by 90%

– EU exports of transport equipment increased by over 56%

– Had the FTA not been in force, the current level of EU exports to Korea would have led to duty payments of EUR 1.6bn

– Overall, the EUR 7.6bn trade deficit with Korea turned into a trade surplus of EUR 3.6bn in the EU's favour

FTA faced fears over anticipated adverse effect on the EU economy, especially in light of the financial crisis

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EU – Korea FTA: not so great

In 2014, EU imports from Korea totalled EUR 37.9bn – roughly equal to the 12-month period before the FTA took effect

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EU – Korea FTA: pretty good

In 2014, Korean imports of goods to EU increased by 6% compared to the previous year

Since the FTA took effect

Significant increases were noted in EU imports of:− plastics 50%− mineral products 112%− chemical products 48%

EU imports from Korea of motor vehicles grew by 53%– EU imports of passenger cars from the rest of the world declined by 7%

EU imports from Korea of car parts increased by over 20%– respective imports from the rest of the world increased by merely 3%

While imports of electronics decreased by 13% in the second year of FTA implementation, in the third year they increased by 31%

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EU – Korea FTA: pretty good

Thank you!