Reshoring Pattern-Analysis of China Based Korean Firms and Its Policy Implications

8 Pages Posted: 28 Apr 2016 Last revised: 5 Jun 2016

See all articles by Minkyung Lim

Minkyung Lim

Korea Institute for International Economic Policy

Jina Yeo

Korea Institute for International Economic Policy

Date Written: February 6, 2015

Abstract

This study is an attempt to categorize China-based firms/industry types according to reshoring suitability. This is because Korean reshoring policy needs to be applied correctly depending on priority of those types which would enhance policy effectiveness.

Our findings show that there exist specific business types and industries more suitable for reshoring. Especially, businesses of the 'FTA utilizing type' are very likely to consider reshoring in terms of reducing costs of production in the long run. These firms would likely include ones that import raw materials from Korea and export it to the EU or the U.S., that import raw material from the EU or the U.S. and export it to Korea, and that import raw material from the EU or the U.S. and re-export it to the same markets. We also found that such industries as leather/wood, shoes/textiles, accessories/glass/jewelry, plastic, machine/electronics, vehicle are favourable to maximizing the effect of tariff elimination.

The comparative analysis of country cases also revealed meaningful implications for Korean U-turn policy. Country analysis was carried out targeting the U.S., Japan and Taiwan.

Keywords: Reshoring policy

Suggested Citation

Lim, Minkyung and Yeo, Jina, Reshoring Pattern-Analysis of China Based Korean Firms and Its Policy Implications (February 6, 2015). KIEP Research Paper No. World Economy Update-15-03, Available at SSRN: https://ssrn.com/abstract=2770207 or http://dx.doi.org/10.2139/ssrn.2770207

Minkyung Lim (Contact Author)

Korea Institute for International Economic Policy ( email )

[30147] Building C, Sejong National Research Compl
Seoul, 370
Korea, Republic of (South Korea)

Jina Yeo

Korea Institute for International Economic Policy ( email )

[30147] Building C, Sejong National Research Compl
Seoul, 370
Korea, Republic of (South Korea)

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