Business with Korea

Business with Korea

Derek Waleko Investment Consultant

Mergers & Acquisitions

KOTRA Los Angeles

August 12th, 2015

South Korea

1. Great Test Market

2. Low Labor Cost

3. Sophisticated High-Technology

Northeast Asia

South Korea

CHINA

Northeast

Asia

Strategically Located

South Korea

Area: 100,210 km2

Population: 50.4 million

Per Capita: $28,100

GDP (nominal): $1.4 trillion

Growth Rate: 3.3%

Trade (5th largest port): ▶ Export: $728.2 billion

▶ Import: $643.6 billion

Inflation (CPI): 1.3%

Unemployment: 3.5%

National Debt: 35.1% of GDP

FDI: $19 billion

Foreign Currency Reserves: $346.5 billion

* Short-Term External Debt: $126 billion

* Gross External Debt: $429 billion

2014

South Korea

In effect Concluded Underway On the agenda

Chile (04)

Singapore (06)

EFTA (06)

ASEAN (07)

India CEPA (10)

EU (11)

Peru (11)

United States (12)

Turkey

Colombia

Canada

Mexico

GCC

Australia

New Zealand

China

Vietnam

Indonesia

China/Japan

RCEP

Japan

Central America

MERCOSUR

Israel

Malaysia

FTA

South Korea

2. Scientific Infrastructure

Source: IFPI Digital Music Report 2015, www.ifpi.org

In 2014 the recorded music market saw the strongest

overall growth from South Korea (19.2%). Globally in

2005, Korea ranked 33rd in the music market.

Among the 10 largest markets in the world.

South Korea

South Korea

Ease of doing business (among 183 economies):

22nd (2007) 23rd

(2008)

19th (2009)

5th (2015)

South Korea

KOTRA

KOTRA

• 1962 – Founded

• 1998 – FDI

• 2013 – M&A

123 offices / 84 countries

1. Business Incubator

2. Marketing

3. Research

4. FTA Help Desk

5. Contact Korea

6. In-house Counsel

7. Investment

FTA Seminars

FTA Seminars

Korean Latino Partnership

Korean Latino Partnership

Foreign Investment Week

Foreign Investment Week

FDI Success Cases

FDI Success Cases

Current Cases

Current Cases

• Bainbridge is an investment

banking firm and a direct

private equity investments

company. Bainbridge works

with the top global

multinational corporations,

private equity firms, pensions,

endowments, and family offices.

• 500 million USD

• Local Motors is an American

motor vehicle manufacturing

company focused on low-

volume manufacturing of open-

source motor vehicle designs

using multiple microfactories.

They were founded in 2007

with headquarters in Phoenix,

Arizona.

• 10 million USD

Current Cases

Bainbridge Investments

Current Cases

Local Motors

KOTRA LA Success Stories

KOTRA LA Success Stories

KOTRA LA Success Stories

KOTRA LA Success Stories

KOTRA LA Success Stories

M&A

M&A

Korean Clients

• Sales

$50M – 5B

• Low Middle Market

Transactions

$5M – 1B

• Controlling Stake

51%

• Manufacturing

Automotive

Biotechnologies

Pharmaceuticals

Mobile components

M&A

M&A

Thank You

FTA

US Exports to South Korea

Million

Gallons

Corporate income tax: 100% for 5 yrs,

50% for 2 yrs

Acquisition tax, property tax: 5-15 yrs

Tariff for capital goods: 5 yrs

To finance the construction of facilities

or the purchase of equipment related to

the investment

Reduction or exemption of rent

Support for building of infrastructure

Subsidies for employment and education

Support in settling into Korea

Criteria

Manufacturing – $30 million FDI or more

Logistics & SOC – More than $10 million FDI

Tourism – More than $20 million FDI

R&D – More than $2 million FDI

FDI Incentives