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  • The Next Export Industry ‘Pharmaceuticals’ to Follow Semiconductors
    2019-05-27 hit 115

    The Next Export Industry ‘Pharmaceuticals’ to Follow Semiconductors

     

    - Average export growth rate of exports for 5 years was 21.1 percent, which exceeded that of semiconductors (19.3%) Need to intensively foster the industry as a new export industry -


     

    Pharmaceuticals are rapidly growing as a Korea’s future export industry following semiconductor.


     

    According to a report titled ‘Examination of Korea's Export Competitiveness and Implications’ issued by the Institute for International Trade (President, Shin Seung-kwan) of the Korea International Trade Association on May 27th, Korea's exports of medical supplies reached a record high of 3.720 billion dollars last year. The average annual export growth rate between 2014 and 2018 was 21.1 percent, which was significantly ahead of major items such as semiconductors (19.3%), computers (8.7%), automobiles (-4.1%) and wireless communication devices (-12.8%). In particular, biomedicines, which are currently focusing on overseas markets rather than domestic market, grew at an average annual rate of 35.6percent from 2014 to 2017.


     

    In terms of each country’s export ranking and export market share in 2017, Korea ranked 22nd in the world with a market share of 0.46 percent, following China (10th, 2.06%) and Japan (19th, 0.70%). Considering the rankings and market shares of China and Japan in 2010 that were 11th (1.94%) and 18th (0.85%), respectively, their performances were rather at a standstill or declined. However, Korea overwhelmed China and Japan during the same period by jumping 5 steps from the ranking 27th (0.23%) in 2010 with the more than doubled market share.


     

    The revealed comparative advantage (RCA) index of Korea's pharmaceutical exports was 0.147 (the world's 22nd) behind India (1.290, 12th), Japan (0.187, 20th), China (0.169, 21st). However, it indicated that Korea’s global competitiveness is continuously improving as the figure increased more than two times from 0.085 in 2010.


     

    The Export Similarity Index (ESI), which shows the degree of competition between the two countries in a particular market, is also dramatically increasing in advanced countries of medicines such as the United States, Germany and Japan. As of 2017, the ESI index between Korea and the United States was 0.51, the highest among the major economies, followed by Germany (0.44) and Japan (0.33). The fact that the export similarities between Korea and the United States and Korea and Germany have increased compared to the past means that Korea is fiercely competing with advanced countries in pharmaceuticals.


     

     

    A researcher at the Institute for International Trade of the Korea International Trade Association, said, "Korean pharmaceutical industry is showing the possibility of major leaps in all aspects, including global market share, export competitiveness, and competition with medically advanced countries." The researcher stressed, "If the efforts for continuous research and development (R&D), institutional support, and professional human resources training are organically combined, the pharmaceutical industry will become the second export industry following semiconductor industry."


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