Korean Government Targets Significant Growth in Exports of Consumer Goods to China

The Korean government is accelerating the expansion of K-consumer goods into the Chinese market, riding the positive wave of improved Korea-China relations. With an aim to define the year as the "Year of the V-shaped Recovery in Exports to China," the Ministry of Trade is facilitating measures to ensure that the growth momentum in consumer goods exports observed in the first half continues through the end of the year.

On August 21, the Ministry of Trade, led by Minister Kim Jeong-gwan, convened a "Consumer Goods Export Review Meeting" with KOTRA President Kang Kyung-seong and other key stakeholders, including officials from Korea's diplomatic missions in China and KOTRA's regional trade offices. The meeting focused on assessing the export performance of consumer goods during the first half of the year and discussing strategies for further market expansion.

Despite the Chinese consumer goods market being valued at over 50 trillion yuan, Korea’s consumer goods exports had declined steadily after peaking at $9.3 billion in 2021. The government is leveraging the revitalization of Korea-China relations following early-year diplomatic engagements to boost exports through reinforced cooperation at both central and local government levels, establishment of certification and distribution networks within China, and enhanced marketing strategies targeting emerging consumer demographics such as Gen Z and the senior population.

As a result, consumer goods exports to China reached $3.44 billion in the first half of this year, reflecting an 8.7% increase year-on-year. Notably, exports in fashion apparel surged by 33.4% and food products by 17.7%. Furthermore, the cosmetics sector experienced a recovery, turning to a growth trajectory of 23.8% since June compared to the previous year.

The growth has not been limited to specific regions, with significant increases noted in various parts of China: Hubei (+378%), Liaoning (+69%), Hainan (+62%), Beijing (+46%), Shaanxi (+33%), and Anhui (+15%).

To solidify the "V-shaped recovery" in consumer goods exports this year, the government plans to intensify support for specialized entry into various regions of China during the second half. This includes adopting local consumer trends through live commerce broadcasts on platforms like TikTok (Douyin) and Xiaohongshu, as well as establishing K-consumer goods pop-up stores in key cities to enhance offline consumer experiences.

The government will also implement a “One Trade Office - One Distribution Network Cooperation Project,” aiming to foster partnerships with large distribution networks like JD and Alibaba, while also developing ten new local distribution networks. Additionally, logistics support systems will be established to connect coastal areas with inland regions through the establishment of K-consumer goods logistics desks in cities like Chengdu and Xi'an. Furthermore, by strengthening networks with local governments in Shandong, Jiangsu, and Guangdong, the ministry aims to create a favorable business environment through proactive resolution of export-related challenges.