Exporters say many markets too mature to promise more profit

Published : Mar 21, 2016 - 11:32 Updated : Mar 21, 2016 - 11:32

A large majority of Korean exporters see their respective markets as being too mature to deliver profits or sales increases, and want to find new lines of business, a survey indicated Monday.

When the Korea Chamber of Commerce and Industry (KCCI) recently polled 300 local manufacturers of the country's 13 mainstay export products, 66.3 percent said their markets have ripened to the point that growth has dulled and profit is falling. Another 12.2 percent assessed the markets as being on downward spirals. Only 21.5 percent said they saw growth potential.

Matured markets, according to the polled firms, include computers (80 percent), textiles (76 percent), flat panel displays (72.2 percent) and wireless communication devices (71.4 percent). Below them were automobiles (50 percent) and semiconductors (41.7 percent).

Some of the companies picked shipbuilding (26.1 percent), textiles (25 percent) and flat panel displays (22.2 percent) as markets that are already on downward paths.

While 86.6 percent said they plan to pursue new businesses as alternatives, nearly half of them (45.7 percent) said they will stay in closely related lines of business, the survey showed. ICT convergence, new materials, new energy and biohealth were picked as some new areas of interest.

The companies, however, have been slow in acting out their plans. Of those who said they will pursue new businesses, 56.6 percent said they were still in the initial stage of review, compared with 23.2 percent who are in the launching process and 10.5 percent who were ready to go to market. According to the poll, 49.5 percent of the companies worry about uncertain profitability in planning new businesses.

"Not only labor-intensive industries but the IT industry as well are in structural ruts from teeming markets and rising technological standards," the KCCI said. "The semiconductor and automobile industries can't be complacent as late market entrants are fast catching up and market conditions are changing rapidly." (Yonhap)