South Korea: Companies returning production bases from China to South Korea: Only 80 companies
-A Korean company that depends on low production costs in China-
Korean companies:
It highlights the “risk of being overly dependent on China as a manufacturing base.”
In South Korea, a law was introduced in 2013 to stop the flow of increased overseas production.
However, only a limited number of companies have returned their production bases from China to South Korea.
Survey by Korea Institute of Industry (KIET):
Of the thousands of companies expanding into China, only 80 have returned part of their business to South Korea since the introduction of the law.
Korean Government:
Earlier this year, it expanded related subsidies to the service sector and IT (information and communication) companies.
However, the appeal of returning to South Korea seems to be weak.
Korea SME Federation:
Researcher Bae Ho Young
Rigid labor market and
High employment costs,
Touching various environmental regulations,
He points out that “the hurdle is too high” to return to South Korea.
Survey conducted in June:
Of the 10 Korean companies based in China, 7 are not interested in returning to their home countries.
Of the 10 companies that entered Vietnam, 9 also said they had no such plans.
International Labor Organization (ILO):
In South Korea, the average monthly wage of factory workers is $ 3,405 (about 360,000 yen) as of 2019.
13 times more than Vietnam in 2018,
It is four times that of China in 2016.
(Bloomberg) –Yahoo! News
https://news.yahoo.co.jp/articles/c438df2e1ba24b5efc57c0870b1cd916d538a568
South Korean Firms Reluctant to Bring Production Back From China
High costs at home prompt shifting firms to choose SE Asia
Just 80 firms relocate some operations to Korea since 2013
Anecdotal evidence
indicates that firms considering cutting back operations in China are instead looking to relocate in Southeast Asia.That suggests Korea is missing
an opportunity to bring back jobs,secure its supply chains in the pandemic and maintain its domestic production competitiveness.