High-tech growth faster in China than in Korea

Economists in Korea and China said Korea still has an edge over China in manufacturing technologies, but they predicted the gap is going to narrow quickly as China’s industry develops.
In a seminar on the development of manufacturing in Korea and China, Youn Woo-jin, vice president of research at the Korea Institute for Industrial Economics and Trade, or KIET, said China has been catching up fast with Korea in high-technology exports. The seminar was co-hosted by KIET, a state-run think tank, and China’s International Institute of Economics in Beijing yesterday.
Youn said Korea moved up two notches to 14th place in terms of the percentage high-tech exports made up of the country’s total manufacturing exports from 1995 to 2005. China jumped eight steps to 21st for the same period.
Youn said that in 2005, Korea’s export industries ranked lower than Singapore’s and Japan’s, but similar to Hong Kong’s. With the maturation of China’s export industries, 57.7 percent of Korea’s exports had Chinese competitors in 2005, up from 29 percent in 1995.
Youn said Korea exports parts and relatively high-end products to China, while it imports relatively low-end finished products. This trend is expected to continue until 2010.
“Mid-tech industries such as the automobile, steel and petrochemical industries in Korea took root as exports industries early, but mid-tech industries in China are still focusing on the domestic market,” Youn said.
Another researcher at the state-run institute said the world’s shipbuilding market continues to boom and Korea is still the leader. But the gap between Korea and China will narrow and disappear by 2015. Korea received ship orders of 220 million CGT, or compensated gross tons, accounting for 39 percent of total orders last year, while China received 127 CGT, making up 22.7 percent of the market share.
Kim Ju-han, another KIET researcher, said as China’s production and exports of steel grow, the two countries’ trade of steel products is no longer complementary but competitive.

By Limb Jae-un Staff Writer [jbiz91@joongang.co.kr]