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SCMP Reporter

KOREA is now Hong Kong's seventh largest trading partner with bilateral trade increasing by 11 per cent last year.

  Business dealings were worth US$8.4 billion and accounted for 3.2 per cent of Hong Kong's total trade. Much of that trade involved re-exports from China.

  'Hong Kong is an important entrepot for Korea-China trade,' according to the Trade Development Council. Re-exports between the two rose by 12 per cent last year to US$3 billion and have continued to rise steadily this year.

  Hong Kong's domestic exports to Korea were rising dramatically. Last year, the increase was 38 per cent and, in the first two months of this year, exports were up by another 18 per cent.

   Leading the export drive was trade in tobacco, semiconductors, watches, textiles, cutlery and computer parts.

  Conducting much of that trade were about 350 Korean companies with Hong Kong bases, including seven of the country's leading conglomerates or chaebols - Hyundai, Lucky-Goldstar, Lotte, Kolon, Daewoo, Samsung and Sunkyong.

  These chaebols have been largely instrumental in Korea's rapid economic development, exerting a far-reaching influence in virtually all sectors of the economy, from manufacturing, construction and finance to international trade, hotels and retailing.

  Korea's top 50 chaebols account for 15 per cent of the country's entire gross national product.

  Tourism was another noteworthy bonus to Hong Kong. Almost 250,000 Koreans visited the territory last year - an increase of almost 15 per cent over the previous year, reflecting Korea's recent economic recovery after two years of sluggish growth.

  The economy was forecast to grow by 7.6 per cent this year.

  Since re-establishing diplomatic relations with China two years ago, Korea's direct trade dealings with the mainland have gone into 'lift-off' mode.

  Within six months of the accord being signed, Korean companies had embarked on 644 projects in China, mainly in Shandong and the northeast provinces, with the trend continuing at a rapid pace.

 Korean companies are investing in labour-intensive ventures such as textiles, garments, footwear, electrical appliances, electronics and toys.

  Foreign investment in Korea was up, too, due not only to a booming economy but to the easing of government regulations.

   In the past year, foreign businesses have been allowed to establish a total of 20 retail outlets. In the first four months, about 192 foreign enterprises valued at US$519 million were launched, an increase of 36 per cent from the previous year.



Bilateral trade with territory jumps 11 pc