Korea Business Guide: March 2020

Tuesday, March 31, 2020

Salon du Chocolat Seoul 2020

Salon du Chocolat Seoul 2020

January 10^th to January 12^th, 2020

COEX Hall D, Seoul Korea

http://www.salonduchocolat.kr/english

The Salon du Chocolat is an international exhibition first launched in France in 1995. The Salon du Chocolat Seoul 2020, January 10^th to January 12^that COEX Hall D was the sixth show held in Korea. The show was organized by Exporum. The exhibition also held shows for chocolatiers and fashion designers, pastry shows, choco seminars and chocolate cooking experiences.

Exhibits: Cocoa, Chocolate, Growers, Raw Materials, Beverage, Bakery, Dessert, Machin & Equipment, Packing, Interior Accessory, Franchise, Associations etc.

2018 Exhibit Results

● 121+Exhibitors

● 35,000 Visitors

Exhibition

The entrance to the exhibition hall was full of the scent of sweetness. As the opening day was a working day, the exhibition had limited visitors however, the number of visitors is expected to grow during the weekend.

The booths which were near the entrance were international groups and embassies. The Ghana booth was the first booth that one saw when entering the exhibition. There were also booths from Vietnam, Czech Republic, Guatemala, Ecuador, Mexico and other countries.

Next to the international booths, there was the ‘Chocolate Dress Room’ which displayed chocolate fashion items that are showcased during the Cacao Show. The Cacao Show was a runway show that offered visitors the opportunity to enjoy music, fashion and chocolate designs.

Towards the middle of the exhibition hall is the Choco Art section displaying various chocolate art from sculptures to small size chocolate houses that visitors could not resist.

The chocolate that was displayed during the exhibition was unforgettable. There were so many different types and brands of chocolate from raw material chocolate for designs and bean to bar chocolates. In the center of the exhibition hall, renowned chefs specializing in chocolate showed off their masterpieces.

An ongoing seminar was in place by Ghana’s delegation which was the year’s County of Honor. They were explaining the opportunities and steps of investing in Ghana focusing on the Cacao sectors and specific information regarding the health benefits of Cacao.

There were many other events in place included in the Cacao Show, Choco Demo, Choco land and others. These events are one of the main attractions of the exhibition. It allows visitors to have more interaction with the exhibitors and provides a better connection.

It would be difficult to compare to the exhibition in 2019 due to its differences, but there are pros and cons to each show. In 2019, the exhibition was somewhat mixed with the coffee and chocolate industry while this year it was more focused on the chocolate industry. However, the number of exhibitors dropped to around 80 companies which a lot less than last year. There was also more bean to bar companies last year when the International Cocoa Organization was sponsoring the show.

General Market Information

The Ministry of Agriculture, Food and Rural Affairs (MAFRA) reported in 2016 that the chocolate industry growth rate was an average of 1.7% from 2011 to 2015 resulting in market size of KRW 1.15 trillion. In 2017, the retail market grew but domestic chocolate production decreased due to imports of premium chocolate. The tariffs on chocolate is 0 following the FTAs with the US, EU and other Asian countries. Imported chocolate was initially distributed by domestic confectionery companies which made it possible for premium chocolate brands to flourish in the Korean market.

The introduction of premium chocolate changed consumers' attitude towards chocolate. Consumers started to show interest in how chocolate is made and the concept of bean to bar chocolate. As the price and stable supply were difficult it was not easy to have for the bean to bar industry to grow. However, in 2016, the bean to bar chocolate segment gained popularity with the public and cacao bean imports started to stabilize after 2017. Korea was late to introduce the bean to the bar market compared to the US and Japan but we believe that it will catch up resulting in rapid development.

There are many possibilities for the chocolate market in Korea but it will require constant efforts in marketing and promotion to keep up with the competition.

If you would like to identify and capitalize on business opportunities in Korea, let IRC Guide your Way! www.ircconsultingkorea.com, Jacob at lsh@ircconsultingkorea.com

Monday, March 23, 2020

Korea: Second Wave?

As the world reels from the impact of the rapidly spreading virus, I too have tempered my optimism over the past week. The early assessment that the virus was coming under control (based on daily declines in the number of new cases) proves to have been pre-mature. There were several days last week where daily new cases jumped back to the 150 plus mark.

Furthermore, the virus seems to be stalking closer. A greater percentage of the new cases are in the Seoul, metropolitan area and less concentrated in the Daegu hot spot. The son of a colleague at SFS, our local international school, returned from a study break in the UK with COVID-19 among his gifts. Saruga, our local supermarket was closed for disinfecting on Sunday when it transpired that a patron who visited on Wednesday had tested positive. I am not sure whether I should be pleased that we took care of the weekly purchases on Saturday morning before it closed or be concerned that we shopped while the virus might have been lurking around.

Public support in the fight against the virus seems to have taken a blow as well. Video clips of young people thronging to night clubs laid bare the image of civic solidarity. Many churches continue to hold mass services tarnishing the reputation of Christianity here. News reports about a young family of three that recklessly visited Italy last week all returning with the virus enraged citizens who are clamoring they be punished. The prime minister gave a speech on Saturday urging all citizens to be vigilant pleading for the postponement of all non-urgent meetings. The next week or two will unveil whether Korea's tremendous efforts are a model for the world to follow or were merely a fluke. We are not out of the woods yet but let's hope that Sunday's low number of new cases (64) is a return to the downward trend and that last week's high numbers were the anomaly.

Peter Underwood, Managing Partner

For up to date information: Korean Ministry of Health and Welfare Infection Rate Tracker

http://ncov.mohw.go.kr/

contact@ircconsultingkorea.com 

IRC CONSULTING

Suite 1705, Officia Building, 92, Saemunan-ro, Jongno-gu, Seoul, Republic of Korea 03186

서울시 종로구 새문안로 92 광화문 오피시아빌딩, 1705호 Tel: +82-2-737-3222,  http://www.ircconsultingkorea.com

Monday, March 16, 2020

Korea: Pariah to Paragon

Korea was the first country outside of China to be hit by a major outbreak of COVID-19. We were quickly labeled a 'hot-spot' and travelers from Korea were restricted from entering many countries. It is worthy to note that over 30% of all air passengers into Korea come from China. Initially, I was critical of the Korean government for failing to restrict inbound traffic from China but I have come to realize that sealing borders is fruitless and sends an incorrect message that "this is a foreign disease we can shut out" when in fact, it is now very much a local one in every affected country that can only be managed at the local level.

The first COVID-19 patient was identified in Korea on 20 January. Screening of inbound travelers was implemented at all international airports. (The systems have been in place since SARS.) Public announcements exhorting people to wash their hands thoroughly, cover their mouth and wear a mask were posted everywhere. A month later (February 20), there were 30 confirmed cases but the number quickly began to grow exponentially.

The government reacted very rapidly. Schools were closed, large gatherings were postponed or canceled, all trade shows and sporting events were canceled, 'social distancing' (staying a meter away from others) was recommended, and the 'hotspot' of Daegu (Korea’s 3^rd largest city and the location of over 70% of all cases), was put themselves in voluntary 'self-quarantine'. From 7 March, churches were urged to suspend Sunday services. Rapid follow-up with anyone who had been in contact with a confirmed patient was implemented and mandatory testing and/or quarantine imposed. In parallel, massive disinfection efforts have been deployed in airplanes, public transportation (with 75 million riders per annum), restaurants, public buildings and even the streets of Daegu.

What is most notable about Korea is that transparent, factual and comprehensive information on the spread of the disease (number of people tested, test results, new patients, fatalities, and an app tracking the recent routes of confirmed cases), was made available to everyone in real time. Widespread testing (with results available in as little as 2 hours) was implemented including a creative 'drive through' testing system that isolated those being tested from health care personnel. (Korea anticipated this outbreak in response to SARS and MERS and had test kits ready to deploy.) Korea is testing 15,000 people per day (more than the sum total that the United States has tested to date) with a total of over 250,000 citizens tested. The cost of testing is affordable (less than $150) with waivers for confirmed patients and the financially disadvantaged. Interestingly, Korea has not banned travel to or from any country!

The national health system has been able to manage all confirmed cases and no one has been turned away from the hospital, even in the virus’s epicenter in the city of Daegu. Korea has taken special care of its elderly with volunteers providing assistance, and priority given to providing masks and protective gear. Even Korea's elderly are highly 'connected' with near universal penetration of smart phones. The whole community follows emergency alerts (which are broadcast nearly every hour) updating the numbers and locations of confirmed patients. Furthermore, they are able to summon help when needed.

Not only have all citizens been urged to wear masks, the distribution of masks has been organized fairly and transparently via pharmacies, post offices and farmer’s cooperatives. Waiting times in lines have shrunk from hours to minutes. Each citizen is entitled to two masks per week. The price is fixed so gouging is impossible. Each purchase is registered so there is public confidence that no one is using influence or connections to beat the system.

The civic response to COVID-19 in Korea must not be underestimated. Citizens have risen to the challenge. Panic-buying and hoarding are non-existent. With the exception of masks (see above) there are no products that are unavailable and no bare shelves in the supermarkets. Mrs. Kim (who took care of our daughter when she was young and is now in her 80s) told us she had seen reports there was a shortage of toilet paper and rushed to the supermarket to buy some. Seeing that the shelves were fully stocked, she realized that she was being foolish and returned home without buying any.

Korea's aggressive response seems to have been effective. Now, less than four weeks since the crisis exploded, we have had seven straight days of a declining number of newly diagnosed patients (with only one 'bump' in the middle). The number of new cases on 15 March was 75. Since 12 March, the number of patients who have recovered from the disease and been discharged from hospital exceeded the number of new cases. While this is no time to be complacent and we are not out of the woods yet, all indications are that Korea has met the challenge and appears to be getting the upper hand.

I observe Korea's response to COVID-19 with a mixture of pride and humbleness. As a life-long resident of Seoul (and fourth generation American to live here), I have always been proud of this country and its achievements. Having witnessed the transition from a 'basket case' of poverty and starvation to a modern, vibrant, dynamic nation of abundance, it is a model to the world. At the same time, I have been a sometime vocal critic of the government, the education system and corporate culture and urged changes to meet the uncertain challenges of the future. However, Korea performs well in crises. All levels of government have exceeded my expectations. The response to the COVID-19 outbreak has been exemplary and is being referenced in many other countries as a model to follow now and for the next outbreak that is bound to come. It is time for the globe to remove Korea from the banned country list and to respect that the response here was mature, rational, democratic and most importantly, effective.

대한민국 만세!