Kotra's New CEO Cho

Kotra to tap into national funds of new rich countries to attract FDI, give more support to SMEs

The Korea Trade and Investment Promotion Agency (Kotra) will change the name of its 94 overseas trade centers to Korea Business Centers, President Cho Hwan-ik, the new top manager of the government-run export promotion organization said during his first press conference on July 31.
The new CEO, who formerly headed the Korea Export Insurance Corp., another state-run company, and was also a former vice minister of the Ministry of Commerce, Industry and Energy, said Kotra will close its 11 trade centers in Korea and increase the number of its officers assigned to resources-rich countries around the world.
"Kotra should get rid of its bureaucratic habits and become an open-type business hub,"Cho said in unveiling what his main focus would be for Kotra.
He said changing the name of Kotra's overseas offices has to do with changes in emphasis in Kotra's major roles, which are to not only entice foreign investors to Korea, but also to secure natural resources, which is growing in importance in recent years.
He said he will also reorganize the organization to reflect the change of priority in its responsibilities in the fall. Kotra will provide greater support to SMEs operating in foreign countries by closing down domestic trade centers and reducing Kotra's overseas regional offices. Kotra will provide increased on-the-spot support to SMEs overseas.
The move is in line with Kotra's plan to foster 3,000 selected SMEs to be export oriented by 2012. Kotra will turn itself into an active developer from a passive promoter so that it may be able to provide strategies tailor-made for each country in which it operates.
The trade promotion agency will stop being just a trade promotion agent under its Contact Korea program. Through the program, Kotra will search for qualified foreign experts and introduce them to local Korean firms in need of such personnel in their organizations, adding a new dimension to its usual workload.
The trade agency will also take on providing support to exporters of knowledge and financial services to foreign countries with such markets. The knowledge service industry has been growing rapidly to the extent that it has to find overseas markets to further expand, offering such services as online government service, software and other knowledge-intensive business areas. Exports of knowledge services have been avoided due to the need for investments that must follow such exports.
The new Kotra head said he plans to steer the agency to attract $20 billion worth of foreign direct investments into the country by 2012. The agency will tap into national investment funds operated by countries in the Middle East, China, Russia and other rapidly growing economies to invest in Korea. It will also make efforts to attract foreign capital to be invested in the industrial parks exclusively for machinery parts, especially auto parts.
Cho said "liquidity around the world has been expanding rapidly, centered around natural resources-rich countries and countries with huge trade surpluses. He said Kotra should tap the funds of those countries, along with advanced economies, the usual sources for investment funds.
The top Kotra official said investment funds from those countries should be directed to such huge national projects as the Saemankum Industrial Complex to be built on reclaimed land in South Chungcheong Province and the project to develop southern coastal areas of the country.
Kotra will also hire local experts at its overseas business centers to strengthen specialty areas where professionalism is required, such as plant construction projects. In some cases, Kotra will go as far as naming qualified local personnel to run a Kotra business center, if the situation warrants.
Kotra made a list of 30 countries rich in natural resources and its offices in those countries will help Korean firms to explore for natural resources and win such social overhead capital projects as building bridges, highways, power plants and other large projects. He will also consider opening Kotra offices in African countries rich in natural resources. nw

President Cho Hwan-ik of Korea Investment and Trade Promotion Agency.

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