2015
Logistics and Distribution
INVESTMENT OPPORTUNITIES IN KOREA
Logistics and Distribution Centrally located in Northeast Asia, Korea has excellent infrastructure including world-class airports and ports to become the gateway to the Chinese market and global logistics market.
Status of Korean logistics industry (2014)
Incheon International Airport
Busan Port
Cargo traffic volume The world’s 2nd largest
Cargo transshipment volume The world’s 3rd largest
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* Source : KCCI, Statistics Korea
Industry Overview
Competitiveness
Government Policies and Incentives
Status of Korean logistics industry
Korean logistics industry’s ranking in terms of World Bank LPI
Government Policies
Trend of the Northeast Asia’s logistics industry
Korea’s major logistics infrastructure
Incentives
Foreign direct investment : Current status
Success Case
Related Organizations and Associations
B.L International Co., Ltd.
Free Trade Zone Free Economic Zone Related authorities and government organizations Airports and port authorities Related associations and research institutions
Industries ・ Logistics and Distribution
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INVESTMENT OPPORTUNITIES IN KOREA
Industry Overview
Status of Korean logistics industry Centrally located in Northeast Asia, Korea is growing to become the world's logistics hub connecting 56 countries, 184 cities, and 88 airlines as of June 2013 based on its excellent logistics infrastructure including the Incheon International Airport handling the world's 2nd largest cargo volume and Busan Port as the world's 5th largest container port.
6.3% Average growth rate
(2013)
(2013)
(2002~2012)
* Source : Korea Chamber of Commerce, KOSTAT
Trend of the Northeast Asia’s logistics industry The share of the Asian market including the Chinese market is growing in the global trade. The outlook is that the Asian economy will outgrow that of the United States and EU by 2030.
KRW 140 Trillion Sales
360,000 logistics companies
Extemal trade breakdown by region Asia : 5,538
47%
Europe : 6,612
+16%
+13% +19%
53%
+17%
North America : 2,282 +15%
29%
+22%
CIS : 789
71%
51% 49%
Middle East : 1,251
Africa : 594 South and Central America : 750
29% 71%
Internal trade
Extemal trade
USD 500bn p. a.
USD 100bn p. a.
* Source : Re-quoted from WTO; Roland Berger analysis, “Global Logistics Markets”
Foreign direct investment: Current status
Foreign direct investment in the logistics industry
Major investment types Others
Total distribution service
1.3%
3.3%
Terminal operation
4.7%
Warehouse storage Combined transportation
2014 USD 430 million * Source : MOTIE(2014)
Industries ・ Logistics and Distribution
42.7%
7.3% 2013(%)
Cargo transportation
40.7% * Source : Korcham(2013)
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INVESTMENT OPPORTUNITIES IN KOREA
Competitiveness Korean logistics industry’s ranking in terms of World Bank LPI Korea is strengthening its competitiveness in the logistics industry, narrowing the gap between the advanced logistics countries. Korea ranked relatively higher in logistics infrastructure than other components and ranked 21st in the logistics tracing category, which is closely related to the use of IT technologies.
Classification
2007
2010
2012
2014
Ranking
28
26
23
24
Score
3.22
3.33
3.42
3.47
Ranking
25
23
22
18
Score
3.44
3.62
3.74
3.79
Ranking
24
15
12
28
Score
3.44
3.47
3.67
3.44
Ranking
22
23
22
21
Score
3.63
3.64
3.65
3.66
Ranking
25
23
22
21
Score
3.56
3.83
3.68
3.69
Ranking
30
28
21
28
Score
3.86
3.97
4.02
4.00
Customs
Logistics infrastructure
International shipment
Logistics competence
Logistics tracking
Timeliness
* Source : World Bank, “Logistics Performance Index”, http://lpi.worldbank.org/
Korea’s major logistics infrastructure Korea is centrally located in Northeast Asia and has a well-developed network of airports and ports, offering fast access to various cities and countries around the world.
Incheon Int'l Airport and Port of Incheon Incheon Port Korea’s third-largest container port in terms of container throughput Specializes in sea-air multimodal transport Incheon Int'l Airport The world’s second largest airport in terms of cargo throughput Has been rated the world’s best seven years in a row
Pyeongtaek Port
Ulsan Korea’s largest industry-supporting port Recorded Korea's 3rd largest cargo throughput in 2012 The world's 4th largest liquid cargo port
Busan Port
Korea’s fourth-largest container port
The world's 5th container port
Has the largest pier devoted to car exports and imports
Serves as a Northeast Asian center of transshipments, with feeder networks connecting most of the ports in Japan and the coastal area of China
Yeosu-Gwangyang Port The world’s 15th largest port and Korea’s 2nd largest container port
Handles 75% of the national port container cargo
Easy access to the Chinese market Promoting investment in the hinterlands of Gwangyang Harbor (468,359 m2 available for lease) * Source : Invest Korea (2014)
Industries ・ Logistics and Distribution
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INVESTMENT OPPORTUNITIES IN KOREA
Government Policies and Incentives Government Policies
2002
Aimed to be the logistics hub in the Northeast Asia
2006
Fostered logistics companies
2001,2011 2009 ~ 2013 2014
Incentives
Established the basic plan for logistics industry Established plan to bring the Korean logistics industry in line with advanced markets Drew up measures to promote investment in the seven promising service industries Expanding logistics infrastructure and fostering logistics industries
Expanding supply of logistics complexes
Enhancing the logistics hub function ofthe Incheon International Airport
Advancing the courier industry
Free trade zone
Free economic zone
Low-priced leases Tax deduction Simplified import and export customs clearance Simplified freight management
Incentives for special economic zones
Tax deduction Management environment Settlement environment Incentives for development projects
Success Case B.L International Co., Ltd. A fruit distribution company B.L International Co., Ltd., was established in 1993 with a 100% equity investment by B.A.K. Holdings Limited (CanadaB.L International is expected to create a new logistics business model by providing a wide range of high added-value logistics services that go beyond transshipment and storage to include fruit rinsing, sorting and packaging based on its advanced refrigerator and freezer facilities.
Industries ・ Logistics and Distribution
1993 Advanced into Korea with a 100% equity investment by B.A.K. Holdings Limited (Canada).
Yongin Logistics Center Runs a logistics base in Yongin for fresh fruit exports and imports.
2013 After filing a foreign investment report, the company is building logistic facilities in the hinterland of the Busan New Port (Corporate tax cut for 7 years).
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INVESTMENT OPPORTUNITIES IN KOREA
Related Organizations and Associations Free Trade Zone
Free Economic Zone
Related authorities and government organizations
Industries ・ Logistics and Distribution
Free Trade Zone
Website
Administrative Agency of Gunsan Free Trade Zone
www.ftz.go.kr/gunsan
Administrative Agency of Masan Free Trade Zone
www.ftz.go.kr
Administrative Agency of Daebul Free Trade Zone
www.ftz.go.kr/daebul
Administrative Agency of Yulchon Free Trade Zone
www.ftz.go.kr/yulchon
Administrative Agency of Donghae Free Trade Zone
www.ftz.go.kr/dongh
Administrative Agency of Gimje Free Trade Zone
ftz.go.kr/gimje
Administrative Agency of Ulsan Free Trade Zone
ftz.go.kr/ulsan
Free Economic Zone
Website
Incheon Free Economic Zone Authority
www.ifez.go.kr
Busan·Jinhae Free Economic Zone Authority
www.bjfez.go.kr
Korea Agency for Saemangeum Development and Investment
www.kasdi.go.kr
Gwangyang Free Economic Zone Authority
www.gfez.go.kr
Yellow Sea Free Economic Zone Authority
www.yesfez.go.kr
Daegu and Gyeongbuk Free Economic Zone Authority
www.dgfez.go.kr
Chungbuk Free Economic Zone Authority
www.cbfez.go.kr
East Coast Free Economic Zone Authority
www.efez.go.kr
Government organization
Website
Ministry of Land, Infrastructure, and Transport
www.molit.go.kr
Ministry of Oceans and Fisheries
www.mof.go.kr
Korea Trade Investment Promotion Agency (KOTRA)
www.kotra.or.kr
Korea International Trade Association
www.kita.net
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INVESTMENT OPPORTUNITIES IN KOREA
Airports and port authorities
Organization Incheon International Airport Corporation
www.airport.kr
Busan Port Authority
www.busanpa.com/service
Yeosu Gwangyang Port Authority
www.ygpa.or.kr
Ulsan Port Authority
www.upa.or.kr
Incheon Port Authority
www.icpa.or.kr
Gyeonggi Pyeongtaek Port Corporation
www.gppc.or.kr
Related associations and research institutions
Industries ・ Logistics and Distribution
Website
Organization
Website
Korea Transport Institute
www.koti.re.kr
Korea Maritime Institute
www.kmi.re.kr
Korea International Freight Forwarders Association
www.kiffa.or.kr
Korea Integrated Logistics Association
www.koila.or.kr
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