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China-South Korea: High-Tech Alliance

By Tom McGregor (chinadaily.com.cn) Updated: 2012-11-26 14:42

South Korean companies are launching more expansion into the central and western regions of China to enjoy lower labor and productions costs, which appears as a brilliant two-pronged strategy to boost its trade with China.

This could explain why the country's investments in China have amounted to over $52 billion, which is the seventh largest source of direct investments for China.

Beijing is sending signals that it would implement more market-oriented reforms to encourage more FDI inflows in the near future. Beginning on Dec 17, the Chinese government will loosen foreign capital rules to make it easier for foreign investors to convert global currencies into Chinese yuan.

In the meantime, "China and South Korea pledged this week to speed up their Free Trade Area negotiations," according to the China Daily. "China, Japan and South Korea agreed to open negotiations on a free trade agreement on Nov 20, aimed at creating a better environment for investment."

Wang Yun-jong, chairman of the Korea Chamber of Commerce in China, believes the FTA could inspire the Chinese government "to loosen limitations on foreign investment in the cultural and creative industries, including the film industry, and that foreign investment in broadcasting could be allowed," he said.

Progress has already been made in a bid to boost cooperation in regional software development. Yonhap news cited a press release from the South Korean Ministry of Knowledge Economy.

The announcement said, "the countries will work to increase exchange of information and joint global marketing of their software companies by joint development and sharing of the latest technology through a Northeast Asian association for the software sector."

The strength of South Korea's economy can be found in its high-tech sector. Chinese technology companies can upgrade by establishing a better partnership with its Asian neighbor to the East. Perhaps, it's time to popularize the phrase, "learn from Samsung."

The views do not necessarily reflect those of China Daily.

Mcgregor@chinadaily.com.cn

 

Tom McGregor's previous articles:

Smooth move to loosen foreign capital rules

PAN China pours $105m in Indonesia

China's business taste for wine

HSBC gives thumbs up to Zoomlion 

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