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2020 European Business in Korea Confidence Survey

The year 2020 has been heavily impacted by the COVID-19 pandemic. However the impact of measures to contain the virus in Korea could be evaluated as rather mild thus making Korea an attractive market for European businesses. Every year, new European companies are entering the Korean market and 91% of participating companies already being here intend expanding their business operation even further, as the 2020 European Business in Korea Confidence Survey showed. 127 European company executives, representing companies with a combined workforce exceeding 47,000 employees and a total turnover of more than EUR 49 billion, answered the survey.

Korea with its population of 50 million people but also with its globally leading companies, is and remains an important market and gateway to Asia for European companies seeking to get a foothold in Asians markets. The wide majority of the respondents (92%) replied that Korea holds at least the same or even a higher level of importance in their company’s global strategy. Indeed, European companies consider Korea as a key market as 66% of responding companies have experienced a similar or higher turnover compared to 2019. Businesspeople are in general more positive than not when it comes to conducting business in the current COVID-19 environment: 45% expect a better business environment in 2021. 15% of companies expecting to have recovered fully business wise from COVID-19 during the first two quarters of 2021 and other 53% expect to have reached this during the second half of the year.

Despite its attractiveness, Korea is also a challenging market. There is still a high need to improve the business landscape such as in labour relations and labour costs, with 63% of the respondents replied that doing business in Korea has become more difficult over the last two years. Profitability in some cases only could be ensured by reducing the workforce as observed at 32% companies although 40% of companies intend to hire additional staff in 2021 and 48% to keep the current workforce on board. Also 46% of business leaders stated that reforms implemented by the Korean government have not helped their business (65% in 2019). Looking at 2021, the most difficult matters for companies were the uncertainty from the resurgence of COVID-19 (52%), labour policy burden (22%) and global trade uncertainty (18%). 

Since 2014, the purpose of the Business Confidence Survey of European Businesses in Korea is to take an annual snapshot of European companies' perceptions, successes and challenges in Korea. It is jointly led by the European, French, British and German Chambers of Commerce and Industry in Korea, with the contribution of the other European Chambers in Korea.

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