(MENAFN- Daily News Egypt) Egypt stands as a pivotal strategic partner for South Korea within the African continent. Currently, over 40 Korean enterprises span across various sectors within Egypt, showcasing the robust commercial synergy between the two nations. The trade volume between Egypt and South Korea is on a trajectory towards recovery in 2024, buoyed by the recent positive shifts in Egypt's economic landscape.
In the wake of the last decade, Egyptian-South Korean relations have flourished, marked by a surge in trade, as well as cultural, political, and economic collaboration. In the aftermath of the inaugural African-South Korean summit, Daily News Egypt engaged in dialogue with Kim Yonghyon, the esteemed Ambassador of the Republic of Korea to Egypt. The discussion provided insightful revelations regarding the summit's key resolutions and the progressive strides in Egypt-South Korea cooperation.
What is the significance of South Korea's first summit with African countries, and what are the key areas and outcomes of the summit?
The inaugural Korea-Africa Summit (4-5 June) marks a significant step in South Korea's commitment to building a sustainable and strategic long-term partnership with Africa. The summit, which saw participation from 48 African countries and regional organizations, focused on shared growth, sustainability, and solidarity. Key outcomes include the adoption of the Joint Declaration, and the announcement of“Korea's Commitments” to increase ODA to $10bn by 2030, provide $14bn in export financing, and initiate high-level dialogue on critical mineral supply chains. The agenda also covered infrastructure, food security, climate change, and digital technologies.
How will the summit enhance cooperation between South Korea and African countries?
The summit has laid a strong foundation for future cooperation. The“Korea's Commitments” are set to boost economic ties, with substantial financial pledges to aid Korean trade and investment in Africa. The high-level dialogue on mineral supply chains and discussions on key global issues like infrastructure and climate change are poised to deepen the partnership.
Can you discuss Egypt's role and contributions to the success of the 2024 Korea-Africa Summit?
Egypt played a pivotal role as a strategic partner. Rania Al-Mahsat, Minister of International Cooperation, led the Egyptian delegation, while Amr Taalat, Minister of Communication and Information Technology, participated in the ICT Leadership Forum. Their involvement was instrumental in the summit's success.
What were the major bilateral outcomes of the Summit between Egypt and Korea?
The summit was a milestone for Egypt-Korea relations, with several key achievements:
Korea's soft loan pledge to Egypt increased from $1bn to $3bn.
The MOU between the Korean EXIM bank and the Ministry of International Cooperation aims to broaden joint development projects.
KOICA and EAPD signed an MOU on trilateral cooperation to provide development assistance to African countries.
An agreement to establish a Digital Government Cooperation Center in Egypt by 2025, reinforcing Egypt's role in supporting the digitization of government services in Africa.
As the South Korean Ambassador to Egypt, how would you describe the current state of relations between South Korea and Egypt?
Since the establishment of the Comprehensive Cooperative Partnership in 2016, following President Al-Sisi's historic visit to Korea, our bilateral relations have been growing rapidly. We've seen significant achievements, particularly in the last few years.
What are the key challenges and opportunities in further strengthening these ties?
Over 40 Korean companies are thriving in Egypt across various sectors, including electronics, transportation, chemicals, and textiles. The success of these companies is crucial to attracting more Korean investment. Companies like Samsung and LG are already contributing to Egypt's manufacturing and export initiatives, creating quality jobs. However, sustaining excellent bilateral relations requires ongoing support from the citizens of both nations, which is why we're committed to fostering mutual understanding through active exchange and public diplomacy.
Can you reveal the trade exchange volume between Egypt and Korea during 2023?
Egypt is a key trading partner for Korea in Africa. In 2023, our bilateral trade volume was $2bn, which, while a decrease from $3.2bn in 2022, is expected to recover due to improvements in Egypt's economic environment.
How has the trade relationship between the two countries evolved in recent years?
The trade volume doesn't yet reflect the full potential of our partnership, given Egypt's strengths as an emerging economic powerhouse. The Korean Embassy actively promotes business exchanges and interactions to expand this potential. Additionally, a joint feasibility study for an Economic Partnership Agreement is in progress, which, once concluded, will likely boost trade and Korean investment in Egypt.
Could you elaborate on the nature and extent of Korean involvement in major projects such as the Suez Canal Economic Zone (SCZONE) and the New Administrative Capital?
Korea's involvement in Egypt's major projects is a testament to our interest in exploring new collaboration opportunities. In the SCZONE, a key driver of Egypt's economic growth, Hyundai Rotem is partnering with NERIC to build a factory for Cairo Metro vehicles. SK Ecoplant has signed an MOU to construct green hydrogen and ammonia facilities.
What about the New Administrative Capital?
The New Administrative Capital's construction is progressing well, with LS Electric, a major Korean electric company, participating currently in the construction of the Greater Cairo Monorail project connecting Cairo and the New Administrative Capital. Korea's experience in building Sejong, our administrative city, is being shared through the Korean National Agency for Administrative City Construction's (NAACC) cooperation with its Egyptian counterpart, the Administrative Capital of Urban Development (ACUD) to develop smart cities.
Can you provide details on the volume and focus of South Korean foreign direct investments in Egypt?
Korea sees Egypt as a pivotal investment hub in the region, with $870m invested and over 40 active Korean companies. Manufacturing is the primary sector, led by giants like Samsung and LG Electronics, which are also major exporters from Egypt.
LG Electronics has been manufacturing home appliances in Egypt since 1990. Samsung Electronics keeps expanding its product portfolio and now produces smartphones and tablets as well as TVs. Samsung's portfolio will be even more expanded soon to include high-end smartphones after the completion of a new factory line in Beni-Suef. I am proud that Samsung Electronics and LG Electronics have become major exporters from Egypt to Europe, the Middle East, and Africa.
Moreover, Korean SMEs are vital partners in Egypt, involved in producing electronic components, steel, razors, and plastic products. Their contributions include exporting products, job creation, and technology transfer, bolstering the Egyptian economy.
How do Korean companies view the current economic developments and investment opportunities in Egypt? What challenges do they face when doing business in Egypt?
Korean companies have encountered challenges due to Egypt's foreign currency shortage in recent years. However, the economic situation is rapidly stabilizing, thanks to a significant influx of foreign currencies from the international community. This has generally improved the business conditions for Korean companies.
With the enhanced business environment, the Korean business community is showing a strong interest and enthusiasm for Egypt. As costs rise in traditional manufacturing bases like China and Vietnam, many Korean companies are exploring new investment opportunities. Given Egypt's strategic location, its extensive Free Trade Agreement (FTA) network, and its young, skilled workforce, I am optimistic that economic cooperation between Egypt and Korea will grow substantially.
Can you share the number of Korean tourists who visited Egypt during the year 2023? How important is tourism in strengthening bilateral relations?
The number of Korean tourists visiting Egypt has been rebounding post-COVID-19. In 2023, approximately 33,408 Korean tourists visited Egypt, marking a 129% increase from the previous year.
Tourism plays a crucial role as it allows for a deeper, first-hand understanding between the peoples of both countries. In 2022 and 2023, the Korean government reduced its travel advisory levels for regions such as South Sinai and Siwa, enabling more Korean tourists to experience Egypt's beauty.
The Korean government is committed to enhancing people-to-people exchanges, which includes efforts to resume direct flights between Cairo and Seoul.
Considering recent regional developments, such as the Palestinian-Israeli conflict, including Egypt's role, what implications do you see for South Korea and the region?
The Korean Government is deeply concerned about the escalating humanitarian crisis in the Gaza Strip. We have called for the protection of civilians under international humanitarian law and have provided $10m in humanitarian aid to the Egyptian Red Crescent and UNRWA. We commend Egypt's mediation efforts towards a ceasefire and a comprehensive solution, and we hope for positive outcomes soon. As a non-permanent member of the UN Security Council, Korea is committed to contributing to peace and stability in the region and supports a two-state solution for the Israel-Palestine issue.
We also recognize the critical importance of secure navigation in the Red Sea, a key maritime route for global trade (accounts for 15% of sea freight). We are optimistic about the normalisation of the Suez Canal operations.
Are there any upcoming joint projects or initiatives between South Korea and Egypt that will further enhance bilateral relations?
Yes, development cooperation is a cornerstone of our bilateral relations. Egypt has been designated as a priority partner for Korea's Official Development Assistance (ODA) for 2021, marking it as our first ODA priority partner in the MENA region. Numerous joint development projects are underway.
Following the agreement, we anticipate more bilateral projects to increase Korea's concessional loans to Egypt from $1bn to $3bn during the 2024 Korea-Africa Summit.
Several projects are in progress across sectors like infrastructure, digital governance, green transition, and higher education. For instance, the Green Suez Infrastructure Project, valued at $147m, will enable the Suez Canal Authority to construct eco-friendly LNG tug boats and ferries, aiding Egypt in reducing its carbon emissions.
What are the long-term goals and aspirations for the South Korean embassy in Egypt?
The South Korean embassy in Egypt aims to foster a strong, mutually beneficial relationship with Egypt. We see Egypt as a key strategic partner due to its significant location connecting Europe, the Middle East, and Africa, and its extensive Free Trade Agreement (FTA) network. Our long-term goals include enhancing economic cooperation, cultural ties, and strategic partnerships.
How do you envision the future of the relationship between South Korea and Egypt?
I envision a future where the manufacturing prowess of Korea synergizes with Egypt's growth potential and attractive investment incentives. This includes golden licenses, tax exemptions, and export subsidies offered by the Egyptian government. Such collaboration promises a win-win scenario, boosting investments and enriching both nations. As we approach the 30th anniversary of our diplomatic relations, the embassy is dedicated to realizing this potential through cultural events, delegation visits, and people-to-people exchanges, including tourism, to strengthen our bond with the Global South.
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