Bridging Borders: Unleashing Korea's Innovative Potential in UAE and the region Through Strategic Trade Collaborations
Korea Focus
Jiwon HaSenior Counsel,Korea Group
Soyeh KiBusiness Development & Marketing Lead,Korea Group
Youra KimLegal Assistant,Korea Group
The dynamic expansion of Korean enterprises into the Middle East and North Africa (“MENA”) region presents an exciting opportunity for local companies to engage with innovative partners from South Korea (“Korea”) while Key Korean state-run and government- backed agencies, including the Korea Agro-Fisheries & Food Trade Corporation (“aT”), the Korea Creative Content Agency (“KOCCA”), Korea SMEs & Startups Agency (“KOSME”), the Korea Trade-Investment Promotion Agency (“KOTRA”), and the Korea International Trade Association (“KITA”) are at the forefront of this initiative. These organisations are dedicated to fostering robust trade relations, offering comprehensive support for Korean businesses, and facilitating local partnerships. With the establishment of presences in the UAE and other MENA countries, these K-agencies are committed to creating seamless business
interactions and mutual growth opportunities. Initiatives such as networking events, business matchmaking, incubating Korean companies and field testing projects, are designed to bridge gaps and enhance collaboration between Korean enterprises and local markets. Al Tamimi & Company’s Korea Group met with representatives of each organisation to explore how these collaborative efforts can benefit local companies, providing insights into the diverse contributions of these agencies and the potential for economic growth and cultural exchange in the region.
Al Tamimi & Company: Please introduce your organisation and the services offered by the aT Center in the UAE.
aT: The aT Center, an agency under Korea's Ministry of Agriculture, Food and Rural Affairs, is dedicated to the distribution, processing, promotion, and market stabilisation of agricultural and marine products. With 17 branches across 11 countries, we focus on boosting the export of Korean agricultural and marine products. Acting as a crucial hub for these exports into the Middle East and Africa (“MEA”), we provide localisation support services, including financial subsidies for compliance with local regulations, directly enhancing sales. We play an essential role in developing a global export network, forming Memorandums of Understanding (MOUs) and orchestrating promotional events with local distributors to increase the volume and diversity of Korean agricultural and food products in key markets.
Al Tamimi & Company: Is there any specific support available for MEA-based companies that are interested in Korean products?
aT: We actively align leading Korean exporters with regional demands to foster business opportunities. Our bi-annual events generate substantial outcomes, inviting local buyers to Korea for in-depth consultations with top exporters and arranging visits to production sites, thus broadening the range of products available for import. The localisation support services, beneficial for both Korean exporters and local buyers, significantly enhance the import of Korean agricultural and marine products. Furthermore, we work closely with well-established local distributors, primarily hypermarkets, to bolster promotional efforts for Korean agricultural goods.
Al Tamimi & Company: What are the common challenges Korean companies face when entering or operating in the MEA region?
aT: Korean companies often encounter limited access to information about Middle Eastern markets, posing significant challenges for those less experienced in adapting quickly to regulatory changes. As the demand for Korean products grows, the success of these companies depends heavily on their agility. The brief timeframe for governmental notifications and implementations in the Middle East often results in considerable losses or setbacks for companies that fail to respond swiftly. Therefore, securing timely and relevant information to adjust promptly is crucial for business success.
Al Tamimi & Company: What are aT's future plans, and what initiatives are planned to expand and establish Korean businesses in the MEA region? If local companies wish to participate in these planned initiatives, how can they apply?
aT: We are organising the K-Food Fair on October 1st-2nd at the Jumeirah Beach Hotel, showcasing 50 prominent Korean agricultural and food companies. This event, featuring one-on-one consultations and attracting 30 local buyers from the Middle East, provides an excellent opportunity to directly experience Korean products and discuss future business prospects. Our objective is to increase the recognition and market share of K-Food in the region, alongside enhancing export volumes and varieties. Supporting Korean companies and cultivating robust networks with reliable local buyers to enhance business opportunities is a key priority. Interested local buyers are encouraged to reach out to us at dubai@at.or.kr or visit our website at https://global.at.or.kr for more information.
Al Tamimi & Company: Could you briefly introduce the organisation and the reasons behind establishing the KOCCA Centrer in the UAE?
KOCCA: KOCCA is a government agency dedicated to promoting the growth of the Korean content industry by fostering its development and spearheading its global expansion. The KOCCA UAE Center (“the UAE Centre”) was established to enhance the entry of Korean content companies into the MENA region. With a strategic focus on the UAE and Saudi Arabia, we diligently collect and analyses local market data, rapidly providing Korean enterprises with critical information to support informed market entry strategies. Our active networking efforts aim to identify and engage potential local partners, continually enriching our database.
By maintaining a strong local presence and participating in key regional events, we strive to broaden the distribution of Korean content across the MENA region, identifying potential partners and buyers to facilitate deeper market penetration.
Al Tamimi & Company: Does the UAE Centre also provide services for local companies that are interested in collaborating with Korean companies or considering entering the Korean market?
KOCCA: We support local companies by organising initial virtual meetings with potential Korean partners and facilitating visits to Korea, aligned with major international market events hosted by KOCCA headquarters. These events include the BCWW for broadcasting, the Content Licensing Fair for character animation and comics, MU for music, and Fashion Code for fashion. Our proactive approach includes inviting international buyers as speakers and providing exhibition booths, as well as organising comprehensive business consultation sessions. This enables direct engagement with Korean content and detailed discussion of business opportunities.
Al Tamimi & Company: Do you collaborate with local government agencies or companies? What types of agencies or industries do you typically work with?
KOCCA: In the UAE, our collaboration with government authorities is tailored to the specific requirements of each emirate. In Dubai, for instance, we frequently partner with the Dubai Festivals and Retail Establishment (DFRE) for content regulation and event licensing. A highlight was the successful hosting of a K-POP concert and convention at the Coca-Cola Arena in Dubai in 2023, backed by local government support, where we managed all logistics, including the invitation of Korean artists. Such events, leveraging K-POP’s global appeal, significantly enhance local engagement with Korean cultural content and are seen as valuable by both the local government and our agency. We are committed to expanding these successful collaborations with similar events in the future.
Interest in Korean content across the Middle East continues to grow each year. K-POP, in particular, has garnered intense local interest, driving the demand for more performances. Additionally, local media companies are keenly interested in acquiring Korean dramas and TV shows, underlining our commitment to meet this demand and support the continuous influx of Korean content into the market.
Al Tamimi & Company: What are the UAE Centre’s future plans in the Middle East and North Africa, and how can local companies participate in these initiatives?
KOCCA: In 2024, we are set to open a dedicated physical venue known as an 'antenna shop' to continuously showcase Korean content. This initiative will allow direct interaction with Korean culture across various sectors such as food, beauty, fashion, design, health, and specialised cultural products. Developed in collaboration with 11 Korean ministries and agencies, this platform is designed to capture real-time feedback on the displayed products, with popular items considered for further business development. Our staff will actively facilitate interactions between local companies and the showcased Korean content, transforming the antenna shop from a mere experiential platform into a crucial business hub. This forms a significant part of our strategic focus for the upcoming year.
Moreover, we will continue to enrich the cultural landscape by regularly hosting K-pop concerts, thereby solidifying the popularity of Korean entertainment in the region. Local companies interested in importing and distributing Korean content are encouraged to contact us at uae@kocca.kr.
Al Tamimi & Company: Could you briefly introduce your agency and explain why you established the Global Business Center (“GBC”) in Dubai?
KOSME GBC: KOSME is a national agency in Korea that comprehensively supports Korean SMEs through various programmes. GBC in the UAE, established in 2006, to streamline the entry of Korean businesses into the Middle Eastern markets, our centre in Jebel Ali offers office space and administrative assistance including business licence acquisition until a company is well-established. Recognising the crucial role of networking, we actively facilitate participation in local exhibitions, providing a strategic advantage to the resident companies in our GBC. Currently, our GBC is home to 15 companies, all benefiting from our comprehensive support services.
With increasing interest in Saudi Arabia, especially following high-profile visits, we established a GBC in Riyadh at the end of last year to support Korean companies aiming to enter Saudi Arabia. Companies that have expanded into the UAE often show interest in Saudi Arabia as well. Some of our resident companies in Dubai have also moved into the Riyadh GBC, creating synergy between the two GBCs, which we expect to grow.
Al Tamimi & Company: Could you share a success story of visible outcomes achieved through GBC's support?
KOSME GBC: Among our resident companies is EXBODY Co., Ltd., a medical device company specialising in musculoskeletal examination and body analysis equipment. They sought to expand into the Middle Eastern market but faced challenges in securing relevant certifications and buyers. We collaborated with local certification bodies to analyse EXBODY's technical documents, identify necessary certifications, and update product manuals and component details. Consequently, EXBODY obtained the ROHS certification from the UAE Ministry of Science and Technology. This achievement enabled them to secure local clients such as medical institutions and gyms, resulting in significant business success last year.
When companies look to enter new markets, navigating regulations and establishing a business foundation can be challenging. We receive positive feedback from our resident companies for providing practical support, such as regulatory advice and office space, helping them overcome these barriers and establish their businesses successfully.
Al Tamimi & Company: Are there services available for local companies interested in collaborating with Korean companies or considering entering the Korean market?
KOSME GBC: In addition to dedicated office spaces for our resident Korean companies, we provide a co-working space designed to foster collaboration and networking between local businesses and Korean companies. Local companies eager to engage with Korean partners are encouraged to visit our GBC in Jebel Ali and utilise this co-working facility. Bookings can be made through our website.
Furthermore, we actively select buyers from the UAE and invite them to events in Korea. This year, we have identified and recommended approximately 10 UAE buyers to participate in the 2024 World Korean Business Convention in October. Expenses for their journey, including airfare and accommodation, are covered, enhancing the opportunity for direct interactions and fostering potential business collaborations with these selected buyers.
For local companies aiming to source Korean products, we recommend registering on our B2B platform, GoBizKorea. This platform hosts offerings from over 300,000 Korean companies and is invaluable for acquiring sought-after items, such as Korean cosmetics. It also facilitates direct communications with suppliers, streamlining the procurement process. Additionally, local companies interested in doing business with Korean companies are welcome to contact us at leehanjoo@kosmes.or.kr. We will add you to our buyer list and provide you with relevant information.
Al Tamimi & Company: What future plans does GBC have, and what initiatives will you undertake to facilitate business expansion between Korean and local companies in the MENA region?
KOSME GBC: Traditionally, Korean companies have primarily focused on industrial goods and construction in the Middle East. However, recent years have seen a diversification in interest, spurred by the influence of Hallyu (the Korean Wave). There is now growing enthusiasm among Korean firms in sectors such as beauty, healthcare, food, and high-tech industries, including artificial intelligence. This broadening of interests is highly beneficial.
To support this expansion, we aim to deepen our collaborations with Free Zones in the UAE, acknowledging the critical role of logistics in facilitating trade. With Korea's robust portfolio of leading logistics companies, we are poised to establish a strong foundation in this sector during the latter half of this year, in line with our strategic long-term objectives.
Al Tamimi & Company: Could you elaborate on the role of the Korea Trade-Investment Promotion Agency Middle East Regional Headquarters (“KOTRA”)?
KOTRA: KOTRA serves as a pivotal facilitator for Korean enterprises seeking to penetrate and expand within the MENA region. With a purview that encompasses 20 nations, including the UAE, Saudi Arabia, and Türkiye, it operates an extensive network of 15 Trade Centres. The suite of services provided includes market analysis, business matching, subsidiary setup guidance, and startup incubation, all meticulously tailored to aid companies in acclimating to the regional market. Moreover, we drive the MENA ingress of Korean firms through strategic programs such as supply chain integration, investment in cutting-edge sectors, startup proliferation, project sponsorship, and Hallyu-inspired marketing.
Al Tamimi & Company: How does KOTRA engage with local authorities and businesses in the Middle East, and what mechanisms are in place to support Korean companies' regional ambitions?
KOTRA: We forge partnerships with influential government bodies in the UAE, such as the Abu Dhabi Chamber of Commerce and Industry (ADCCI) and the Dubai Chamber of Commerce and Industry (DCCI), as well as with entities like the Roads and Transport Authority (RTA) and Dubai Electricity and Water Authority (DEWA). It also collaborates with investors to advance investment initiatives, with a particular emphasis on strengthening ties with enterprises in burgeoning industries like renewable energy, defense, and AI/semiconductors. We provide bespoke support to Korean companies navigating the MENA market, offering guidance from the initial stages of market entry to the realisation of business objectives. For local companies interested in exploring opportunities in Korea, we offer streamlined services, including visa facilitation and matching with Korean buyers. Through Invest Korea, an investment arm of KOTRA, we extend our support to investors looking to invest in Korea, ensuring a seamless process from the expression of interest to the execution of investment plans. Additionally, we collaborate with UAE investment institutions and associations to create platforms for Korean companies to showcase their technological prowess, aiming to identify and nurture promising investment opportunities.
Al Tamimi & Company: What are the prevailing trends in the commercial exchanges between Middle Eastern countries and Korea, and how is KOTRA adapting to the evolving legal and regulatory landscape?
KOTRA: The recent visit of UAE President Mohamed bin Zayed Al Nahyan to Korea, culminating in the signing of the 'Korea-UAE Comprehensive Economic Partnership Agreement (“CEPA”)' [1] by both leaders, underscores Korea's commitment to fostering reciprocal trade cooperation. The December agreement between Korea and the Gulf Cooperation Council (GCC) on an FTA heralds an era of enhanced economic collaboration through tariff reductions and the opening of service sectors. As a catalyst for national trade and investment, we remain vigilant in monitoring the successes and challenges experienced by Korean and local companies, optimising the benefits of CEPA and FTA. We are also proactive in identifying and mitigating non-tariff barriers and other commercial impediments, ensuring that these concerns are addressed in bilateral negotiations. The current surge in Korean companies leveraging the Hallyu (Korean wave) to enter the consumer goods market in the MENA region, coupled with the rise in ICT and advanced manufacturing joint ventures, is exemplified by the inauguration of the 'Arte Museum' in Dubai Mall, a testament to the fusion of Korean technology and local market demand.
[1] Joint Statement between the Republic of Korea and the United Arab Emirates on the occasion of the State Visit of HH Sheikh Mohamed Bin Zayed Al Nahyan, President of the UAE, to the Republic of Korea (May 2024)
Al Tamimi & Company: What are KOTRA's strategic plans for fostering cooperative business expansion and entry for Korean and local companies in the Middle East and North Africa, and what initiatives are on the horizon?
KOTRA: We are poised to continue our multifaceted support for economic collaborations, including the penetration of advanced industries, the promotion of Hallyu-driven consumer goods, startup cultivation, and investment attraction. We are dedicated to fortifying relationships with companies in key future industries, as outlined in the agreements between Korean and UAE leadership. In the upcoming year, we will spearhead the 'Korea-UAE Business Partnership Plaza' under the aegis of the UAE Korean Economic Association and will launch the 'K-Lifestyle in Middle East 2024' marketing campaign. At prestigious international exhibitions like GITEX, we will establish a Korea Pavilion to facilitate networking and business matching between Korean and local companies, further cementing its role as a bridge between Korean innovation and regional market opportunities. Local companies interested in KOTRA's initiatives can contact us at marketing@kotra.ae for detailed information and guidance.
Al Tamimi & Company: Could you briefly introduce your organisation and explain why you established a regional headquarters in the UAE?
KITA: Founded in 1946 to foster economic growth through global trade, KITA is Korea’s largest private trade promotion organisation, with over 73,000 member companies in the manufacturing and services sectors. In 2018, KITA expanded its activities to facilitate Korean companies' entry and enhance trade in the MENA region by establishing the UAE regional headquarters, dubbed 'the UAE Centre'. Starting from 2019, the UAE Centre broadened its services to include support for startups. The UAE Centre primarily matches Korean exporters with local buyers and connects Korean startups with Fortune 500 companies based in the region to foster business and investment opportunities.
Focusing on startup support, the UAE Centre identifies promising ventures and arranges business meetings with global Fortune 500 firms, while also conducting local service testing to ensure successful market entries. Known as 'field testing,' this key initiative, launching in 2024, is designed to simulate and validate Korean startup services in the local market before a full-scale launch.
Al Tamimi & Company: Media reports suggest that Korean startups are highly interested in entering the Middle East. From your perspective on the front lines, what are the prospects for Korean startups in this region?
KITA: There is substantial interest among Korean startups in expanding into the Middle East, recognised as an emerging market and a strategic hub within the MENA region. Attracted by the area's wealth in sovereign funds and family offices, many Korean VCs and startups are exploring opportunities here. Although details about specific companies are confidential, there is a high demand for mentoring and numerous enquiries about establishing VC bases. These efforts aim to facilitate investments in both Korean and local startups, promising mutual growth.
Current investments in Korean startups, while limited, are expected to increase. The UAE is strategically focusing on attracting FDI into competitive sectors such as manufacturing and high-tech, where Korean firms have a strong foothold. This alignment could lead to significant mutual benefits, including overseas expansion for Korean companies and enhanced FDI for the UAE.
Particularly, the UAE shows a strong interest in sectors such as food self-sufficiency and provides substantial investment and administrative support to facilitate Korean entries. As industries prioritised by Saudi Arabia and the UAE continue to develop, there will be increased opportunities for companies capable of contributing significantly to these sectors. Active support is planned to ensure these companies can match with local investors, further facilitating successful integrations into the market.
Al Tamimi & Company: What types of local government agencies and companies do you typically work with?
KITA: We maintain strong relationships with local chambers of commerce to enhance our regional network. We play a crucial role in inviting Korean and international stakeholders and investors to major events in Korea, facilitating discussions on trends and networking opportunities. For instance, at NextRise, KITA's premier startup event, we attract global corporations, 200 leading Korean companies, and 100 venture capital firms. The most recent event, NextRise 2024, held in June, featured H.E. Ahmed Khalifa Al Qubaisi, Chairman of the Abu Dhabi Chamber of Commerce, and led to a Collaboration Agreement between the Abu Dhabi Chamber and KITA to support startup growth in both countries.
For our field test projects supporting startups, we collaborate with local government agencies and companies. We oversee these projects, allowing Korean startups to test their technologies locally. KITA had successfully conducted projects in New York, London, Spain, and Indonesia, in environments such as airports and libraries, to identify areas for improvement. We coordinate with relevant authorities for regulatory approvals and partner with local enterprises managing spaces like shopping malls and airports. A notable success is Deeping Source, a Korean AI startup that tested and refined its services through our project before successfully expanding into the US market.
KITA: As mentioned, KITA has over 73,000 member companies in Korea. If a local company is looking for partners or buyers in Korea, we can facilitate connections with relevant member companies. Additionally, when local conglomerates in the Middle East seek niche technologies to enhance their products or services provided by startups, we can offer support. It is rare for a single startup to fully meet the needs of a company, so it's important to combine services from multiple startups to provide comprehensive solutions. We can coordinate collaborations between local startups and those from Korea and other countries to deliver these integrated services. If local conglomerates or even medium-sized enterprises are looking for such niche services, we are here to assist.
Al Tamimi & Company: What plans does the UAE Centre have for the future, and what projects will you be undertaking in the Middle East and North Africa? If local companies wish to participate in these projects, how can they apply?
KITA: We are advancing various initiatives in the MENA region. Firstly, we are establishing a foundation for regularly conducting startup test bed projects. While the UAE is the primary focus, other Middle Eastern countries such as Oman and Qatar are also being considered. These projects are attracting significant interest as their success could lead to Foreign Direct Investment (FDI) in the respective countries. This initiative offers mutual benefits for Korean startups aiming to enter the Middle Eastern market and the local economies involved.
Additionally, in the latter half of this year, we plan to launch a new lunch club in the UAE to strengthen networking with local businesses during lunch hours. These meetings, held monthly or bi-monthly, will invite local startups, investors, and other business stakeholders to engage in case studies and enhance local networking.
Companies interested in KITA's initiatives and requiring our assistance can contact us at kitauae@kita.net for detailed information and guidance.
For further information,please contact Jiwon Ha and Soyeh Ki,Youra Kim.
Published in September 2024
