Korean firms see China overtaking in all major export sectors by 2030

South Korean companies predict China will overtake the country in competitiveness across 10 major export industries, spanning semiconductors, electronics, automobiles, shipbuilding and batteries, in the next five years, an industry survey showed Monday (December 29).

The Federation of Korean Industries surveyed 200 leading companies across the country’s top export sectors, assessing their competitiveness against China, the US and Japan.

The industries covered in the survey were semiconductors, displays, electronics, including computers, mobile devices and home appliances, automobiles and auto parts, general machinery, shipbuilding, secondary batteries, petrochemicals and petroleum products, and bio-health.

According to the survey, respondents said Chinese companies have already surpassed their Korean counterparts in five categories as of 2025, with steel at the top, followed by general machinery, secondary batteries, displays and automobiles and auto parts.

Korea remained slightly ahead in the remaining five sectors in 2025, but when companies projected to 2030, all sectors are expected to fall behind their Chinese rivals.

When asked to rate the competitiveness of the US, China and Japan in comparison to Korea at a baseline of 100, companies rated the US at 107.2, China at 102.2 and Japan at 93.5 in 2025. By 2030, they projected these figures to climb to 112.9 for the US, 112.3 for China and 95.0 for Japan.

“Domestic companies believe Korea’s corporate competitiveness has already fallen behind that of the US and China, and that the gap will widen further over the next five years," the FKI said in a statement. “Chinese corporate competitiveness is expected to reach a level equal to that of the US within the same period.”

Companies picked China as Korea’s top export competitor this year, with 62.5 % of respondents selecting China, followed by the US with 22.5 % and Japan with 9.5 %.

By 2030, China’s share is projected to rise to 68.5 %, while the US is expected to edge down to 22 % and Japan to 5 %.

When compared with the US, Korea maintained a lead in only three sectors: steel, shipbuilding and secondary batteries. By 2030, steel is also expected to flip, leaving Korea ahead of the US only in shipbuilding and batteries.

Companies said China outperforms Korea largely in price competitiveness, productivity, government support, skilled talent and core technologies.

“Korea currently holds an advantage over China only in product branding among six categories, but even this is expected to be overtaken by China within the next five years,” the FKI said.

Against the US, companies said the US outperforms Korea in all areas, product branding, skilled talent, productivity, core technology, government support and price competitiveness, with the gap expected to widen by 2030.

Survey participants identified weakened domestic product competitiveness as the primary challenge to Korea’s competitiveness, cited by 21.9 % of respondents. This was closely followed by increasing external risks at 20.4 %. Other concerns included sluggish domestic demand due to population decline at 19.6 % and insufficient talent in AI and other critical technologies at 18.5%.

In order to strengthen competitiveness, 28.7 % of companies called for government action to mitigate external risks, followed by 18 % who supported establishing robust systems to nurture essential talent, 17.2 % who urged easing taxes, regulation and labour-market rigidity, and 15.9 % who favoured boosting investment in emerging technology.

Ahn Sung-mi

The Korea Herald

Asia News Network