Economic Cooperation between South Korea and Kazakhstan

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U.S.‐Korea Institute Working Paper SeriesEconomic Cooperation between South Korea and KazakhstanTable 4: Top 10 Export Categories of South Korea and Kazakhstan (2008) (Unit: USD 1 million)2007 2008RankExport CategoryAmount% of IncreaseAmount% of Increase1 Plastics 55 46.8 53 -4.42 Automobiles 78 136.1 31 -59.93 Air Conditioners 4 -77.8 22 4294 Construction Heavy Machinery 25 112.0 19 -25.15 Motor Trucks 44 62.3 18 -59.66 Color TV 17 16.6 15 -12.57 Coffee 7 34.0 12 60.18 Elevators 29 18.6 11 -61.69 Cathode Ray Tube 5 -52.8 10 84.710 Tobacco 6 15.9 8 53.1Total 546 68.6 348 -36.3Note: MTI 4 units, top 10 categories based on the order of the highest amount. The rate of increase is from the same period a year earlier.Source: Korea International Trade Association (KITA).Table 5: Top 10 Import Categories of South Korea and Kazakhstan (2008) (Unit: USD 1 million)2007 2008RankImport CategoryAmount% of IncreaseAmount% of Increase1 Ferroalloy 72 -31.8 139 92.72 Hot Rolled Steel 54 -15.3 106 95.83 Copper and Scrap 40 54,604.8 42 5.54 Magma and Scrap 2 - 40 1,785.55 Silver 6 -74.4 16 186.96 Other Fine Chemicals 4 152.4 5 34.97 Steel Plate 0 - 1 -8 Other Machinery Parts 0 - 0 27,733.69 Corn Flour 0 - 0 -10 Other Printed Matters 0 134.9 0 12.4Total 257 -6.9 350 36.5Note: MTI 4 units, top 10 categories based on the order of the highest amount. The rate of increase is from the same period a year earlier.Source: Korea International Trade Association (KITA)Lee Jae‐young 8
U.S.‐Korea Institute Working Paper SeriesEconomic Cooperation between South Korea and Kazakhstanworld), but ranked 20th in 2008 (0.95 percent of the total Korean FDI to the world). Although the amount of South Koreaninvestment to Kazakhstan is still relatively low, Kazakhstan’s importance to South Korea is steadily rising.Table 6: South Korea and Kazakhstan Investment Trend (USD 1,000 per Case)Year 2003 2004 2005 2006 2007 2008 AccumulationNo. of Reported6 25 32 62 127 65 370CasesNo. of NewCorp.InvestedAmount4 9 19 26 42 27 15913,820 22,527 29,570 264,379 321,078 206,654 976,549Note: The number of reported cases includes the number of common investment cases and the number of increased amount cases.Source: The Export-Import Bank of Korea.Initially, South Korea’s investment in Kazakhstan was concentrated on low-wage manufacturing industries to promote exports.Now, investment is focused on construction, real estate and leasing services, as well as resource development and mining.Most recently, the scope of investment has been expanding into finance and insurance, technology, leisure-related services,and more. The increase in the amount of investment and cases after 2006 resulted from South Korea’s active investmentin real estate and leasing services and construction of large-scale housing complex.Figure 2: Comparison between South Korea’s investment in Kazakhstan in 2001 and 2008 by Category of Business2001 2008Note: The relative importance of invested category of business is based on the invested amount.Source: The Export-Import Bank of Korea.South Korea’s investment in Kazakhstan is mostly by small and medium enterprises (SMEs) rather than by large corporations.As of the end of 2008, the investment rate of SMEs made up 73.7 percent of the total accumulated investment. FDI fromSouth Korean SMEs in Kazakhstan was USD 104.2 million, whereas the amount of investment by large corporations recordedUSD 91.59 million. However, in 2008, Kazakhstan’s credit crunch and economic slowdown reduced 60 percent ofthe investment by SMEs, compared to the previous year.Lee Jae‐young 9
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Economic Cooperation between South Korea and Kazakhstan

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