» ▲Jikwan Sunim, Executive Director of Administration of the Jogye Order of Korean Buddhism (upper center) and Lee Bae-Yong (President Ewha Women's University) (lower) attended "Presevation of China" exhibition at Seoul Historical Museum on Aug. 23. Made available in celebration of the 15th anniversary of Korea-China normalization, about 200,000 have attended the exhibition which runs until Aug. 26.

This week mark the 15th anniversary of the establishment of diplomatic relations between Seoul and Beijing.  Over the 15-year period, the two countries have seen dramatic development in various fields such as trade, culture and education.
Bilateral trade jumped from $6.4 billion in 1992 to $118 billion in 2006, according to the Ministry of Foreign Affairs and Trade. It will likely reach $150 billion this year.  About 43,000 Korean companies are operating in China, making it one of Korea's largest trading partners. Korea is the fourth biggest trade partner for China.

The active economic exchange is mainly due to China's rapidly growing economy and its particularly close proximity to Korea.  The gross domestic product (GDP) of China is No. 4 in the world with $2.7 trillion in 2005, representing five percent of the world's GDP.  China's growth rate has stood at around 10 percent since 2001. Plus, China has the largest foreign reserves, roughly $1.7 trillion on hand.
China has attracted annual foreign direct investment of over $60 billion since 2004, with a significant portion of the investment going into the service sector.  Since 2002, most of Korea's overseas investment has been in China.

With the active economic exchange, the number of people who visited each nation also increased. The number of Chinese visitors to Korea increased from 87,000 in 1992 to 897,000 in 2006. Similarly, the number of Korean visitors to China also increased from 43,000 in 1992 to 3,924,000 in 2006.
 Until recently Chinese goods were considered cheap, both in terms of quality and price. But now Chinese manufacturers equipped with improving technological prowess are threatening their Korean rivals in the global market. The Ministry of Information and Communication compiled data on the technology gap between Korea and China in 506 core IT sectors. According to the data, the gap narrowed to 1.7 years last year, from 2.6 years in 2003.

According to a report filed by the Korea Development Bank Research Institute, China ranked as the top supplier of components to the American market last year, with a 15.9 percent share. It ranked fourth with 5.7 percent in 2000. In contrast, Korea's share of the American market dropped to number six (4.0 percent) from number five (5.3 percent) during the same period.
The technology gap has also affected Korea's trade structure with China. Korea had a trade surplus of US$23.3 billion from China in 2005, but that fell to $20.9 billion last year and is showing a downward trend for this year.

08/24/07