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Lee, Woo-gap Column - Korea-China FTA and the Attraction of President Park

News provided by MACCINE KOREA
November 30, 2014 10:19 KST
  • Lee, Woo-gap: CEO, Friend Co. Ltd. and Harvard Co. Ltd.

SEOUL--(Korea Newswire) November 30, 2014 -- Korea-China FTA was finally signed on November 10 after a long series of negotiations. Some expect a rosy future with a open market of 1.3 billion people that is worth KRW 5 trillion, while others play it down because it does not encompass some important trade items.

My company produces equipment for shipbuilding, with a unrivaled competitiveness in valve spindle for low-speed engines. With world-class technologies and know-hows, we have been setting up mutually cooperative relationships with Chinese companies. We foresaw the Korea-China FTA to pass in time, which prompted us to begin a joint project to construct a large factory in China. It is clear that such advances by my company and the like others will be put under highlight with the passing of the new agreement. However, what we must pay attention to is soft power, rather than traditional industries like shipbuilding, automobile, and steel.

Soft power is a concept on the opposite spectrum of hard power consisting of economy and military, proposed by a scholar of international politics, Joseph Nye, in 1989. Soft power, easily put, is the power of culture. In the method through which power is exercised, soft power refers to the ability to make others want what I want them to do. That is, soft power is attraction to the one holding the power.

Currently, the United States’ status as the superpower is being challenged in many fields by China. There is a low chance, however, that the U.S. will give up its status to China in the 21st century because of its soft power. On a related note, Joseph Nye argued that soft power ultimately has a larger influence than economic or military assets.

China, boosted by its rapid growth, is increasing its overseas investment in order to leap into the front in the race to become the economic superpower. Compared to China’s economic prowess, however, its soft power is less developed, which China, well aware of this fact, is attempting to make up by establishing 465 Confucius Institutes in 465, and 713 of its smaller organizations around the world. Despite such struggle, China is still considered to be child with a large body when it comes to soft power.

What about Korea’s soft power, in comparison? It is undeniable that American popular culture is in favor in most places in the world. Hallyu, or Korean Wave, is the only culture that threatens the dominance of American culture locally and in several aspects. Korean Wave is targeting the world beyond Asia with K-Pop, tv dramas, and games, causing several Asian countries including China to worry over their weakening indigenous popular cultures.

Under such circumstances, we must focus our attention to the influence of Korea-China FTA on the countries’ soft power. Through the newly signed agreement, China opened its previously blocked entertainment market to Korea, which means that Korean companies, in collaboration with Chinese firms, can now produce dramas, films, K-Pop concerts, music albums, and animated tv shows. Compared to China’s trade agreements with other countries, Korea-China FTA allows for the highest level of opening in cultural service market, which will make it easier for Korean entertainment companies to advance into the Chinese market. But the most important aspect of all this is that Korean Wave, the Korean attractiveness, will have a closer place with the 1.3 billion Chinese people, and it has a value that cannot be converted into money. The new situation will give even more advantage to the Korean cultural business, which is already enjoying worldwide fandom.

People around the world enjoy American popular culture, drinking Coca-Cola, enjoying Starbucks, and going crazy over McDonalds. With the new FTA in place, 1.3 billion Chinese will now enjoy Korean soju bombs (mix of soju, a traditional Korean alcoholic beverage, and beer), put on Korean makeup, and come to Korea for cosmetic surgeries. Korea’s newfound attractiveness will also likely influence its foreign relations, causing China to become closer to it than North Korea. In the end, a relatively small flutter of open cultural markets may bring the typhoon that is the unification of the Korean Peninsula.

What then, has caused China, a culturally proud country wary of invasive foreign cultures, to so easily adopt Korea’s soft power? There may be many reasons, but I believe a big part has been played by President Park, whose attractiveness caused many Chinese, including President Xi Jinping of China, to open up their hearts to her country.

The international order in the Northeast Asia resembles that of a cold battlefield, with the complex relationships between Korea, China, Japan, and the U.S. forming a seemingly unsolvable not. An attractive president is a luck for Korea in such a situation.

Lee, Woo-gap
CEO, Friend Co. Ltd. and Harvard Co. Ltd.

Introducing a corporation, Friend Ltd.
Friend Ltd. is a manufacturer that produces marine equipment and marine diesel engine parts. It is a primary supplier to Korea's leading shipbuilding and diesel engine manufacturers as Hyundai Heavy Industries, STX, Sung Dong Shipbuilding and Doosan Engine.
Specifically, Friend Ltd. produces cable tray and valve spindle.
Cable tray is the world’s best product which manufactured with know-how gained from over 30 years of experience in manufacturing related products.
Valve spindle is a part that installed on a low-speed engine and is a product only produced by 1 company in Europe, 1 in Japan and 3 Korean companies in the world.
In particular, Friend obtained all approvals from MAN Diesel & Turbo, the world’s largest marine and industrial engine manufacturer, and is the only authorized company to WARTSILA, a specialized marine engine manufacturer.
Based on the world’s best competitiveness, it is supplying not only to Korea’s large shipbuilders (Hyundai Heavy Industries, STX, Doosan Engine), but to the top 10 engine makers of China and to Mitsui of Japan.
And the all necessary process required in manufacturing valve spindle at Friend, from the delivery of raw materials to packaging and shipping, are done on the premise, therefore has an advantage to able to quickly respond to the buyer’s needs.



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