At the end of 2011, T&T enjoyed a US$822 million trade surplus with South Korea, Ambassador Won-kun Hwang said on September 27 at the Embassy of the Republic of Korea in Fairways, Maraval. Thanks to liquified natural gas (LNG) exports from T&T to Korea, for the first eight months of 2012, T&T has already started registering a staggering surplus for this year too. While Korea is the seventh largest exporter in the world, with approximately US$466 billion in exports annually, LNG imports usually tip the scale in T&T's favour, the ambassador said. Of the US$912 million in imports that Korea took from T&T in 2011, LNG imports, mainly through a "short-term three-year contract" between BPTT and the Korea Gas Corporation (KOGAS), accounted for US$860 million, Hwang said.
Again bolstered by LNG, trade figures for the first eight months of 2012 show that T&T already has a US$405 million trade surplus with Korea, a country with the ninth largest trade volume in the world at US$892 billion. While it decreased by 35.9 per cent from 2009 to 2010, from 2010 to 2011, LNG exports into Korea grew by a whopping 259.4 per cent. At the end of 2010, Korea imported US$239 million in LNG from T&T, US$860 million at the end of 2011, and US$413 million so far for 2012. This puts little T&T in the number seven spot on the list of energy-supplier countries to Korea. Qatar is number one, followed by Indonesia, Oman, Malaysia, Russia and Yemen. Nigeria and Brunei are beneath T&T as eighth and ninth, respectively. Korea meets 97 per cent of its energy needs through imports.
Methanol is the second largest export from T&T to Korea. At the end of 2011, Korea imported 86.7 per cent more methanol from T&T than during 2010. Korea imported US$42 million in methanol at the end of 2011. Figures for up to August 2012 show that methanol exports already stand at US$34 million, 21.3 per cent more than the same period last year. Scrap metal, non-iron and iron, accounted for US$9 million in exports from T&T to South Korea at the end of 2011. Figures available for 2012 so far show that this figure already stands at US$7 million. In comparison with the same period last year, scrap iron exports from T&T to Korea have grown by 81.3 per cent.
Korean exports to T&T growing
Korean exports to T&T are also "very impressive," the ambassador said. He said Korean automobile manufacturers' market share in T&T is astounding because it is comparable to that of much larger countries, like Saudi Arabia and Chile. Korea has been consistently increasing its market share in T&T, he said. At the end of 2009, Korean vehicle manufacturers held 16.6 per cent of the market with 2,021 new sales out of a total market of 12,154 new vehicles sold. This increased to 17.6 per cent at the end of 2010 when 2,165 new Korean vehicles were sold out of a total market of 12,350. At the end of 2011, Korean vehicle manufacturers Hyundai and Kia increased their market share further to 23.4 per cent, with 3,032 new unit sales out of a total market of 12,966.
At the end of Q1 2012, Korea is poised to maintain a respectable market share at 24.4 per cent, with 826 new vehicles sold out of a total of 3,383. Up until 2011, Hyundai was the more popular Korean vehicle brand. In 2009, Hyundai sold 1,093 units while Kia sold 928. In 2010, Hyundai sold 1,118 units while Kia sold 1,047. In 2011, Hyundai sold 1,491 units while Kia sold 1,541. "In T&T, there are two car dealers which sell Korean manufactured cars. Southern Sales sells the Kia Brand, while Neal and Massy sells the Hyundai brand," said Third Secretary Youngsoo H Kim in an embassy document. The third secretary said among the "benefits to Southern Sales from the sale of Kia" are that it has helped the T&T company to become the second largest dealership in 2011, and it has helped the company to achieve the highest volume and sales in 2011. It has also prompted the company to expand by opening a new Kia showroom, he said.
With regard to Neal and Massy, Kim said in his document, "In 1992, almost 20 years ago, Neal & Massy Automotive Ltd partnered with Hyundai in the twin island republic of Trinidad and Tobago. Building on a strong market acceptance, two years ago they began an intense focus on customer service and satisfaction, and it is this, combined with (a) phenomenal product and support for Hyundai, that (have) fuelled their market share growth in 2011. They are very thankful to Hyundai for the undying passion, drive and support. The team at Neal & Massy Automotive Ltd values the new thinking that will support their journey to (be) number one in the market. For the month of April 2012, the Hyundai brand attained second position in the industry with 189 unit sales and a market share of 17.3 per cent." The year 2011 closed with Korea registering approximately US$45 million in automobile exports to T&T, up 50 per cent from the previous year.
As at August 2012, the figure had reached approximately US$38 million, up 33.9 per cent in comparison to the same period last year.
Korea's second largest export to T&T are metal products, which accounted for US$18.5 million at the end of 2011, up 175.8 per cent from the previous year. Approximately US$2 million in metal products were imported into T&T from Korea up to August 2012, 85 per cent less than during the same period last year. Machinery is Korea's third top export to T&T, accounting for US$12.2 million at the end of 2011, and US$1.642 million for the first eight months of 2012. "We guess many Trinidadians are using Korean TVs," Hwang said. He guessed that Korean air conditioners are also in use in many homes in T&T. He said Korean air conditioners reach desired temperatures "in only three minutes, and use much less electricity than other brands."
Where the rubber meets the road
Korea's fourth largest export to T&T are tyres. At the end of 2011, T&T imported US$3.4 million in tyres from Korea, 37 per cent less than in 2010. Up to August 2012, the embassy's figures said T&T imported only US$1.692 million in tyres. Batteries are the fifth largest import T&T companies take from Korea. At the end of 2011, T&T car battery resellers imported US$2.3 million in Korean batteries, 15.9 per cent less than in 2010, but up to August 2012, US$1.9 million were imported, which represents a 34 percent increase in comparison with the same period last year. Korea's total exports to T&T at the end of 2011 were US$90.3 million, 68.2 per cent more than in 2010. Up to August 2012, Korea exported US$49.5 million to T&T, down 20.7 per cent in comparison with the same period last year.
Hwang said, "Korean exports are expected to increase at a steady rate because Korean cars are selling very well and they are increasing their market share here." As for T&T's surplus in the trade relationship, the ambassador said it depends a lot on international LNG?prices. Hwang said while there is no foreign direct investment from Korea into T&T, Samsung Engineering is constructing a plant as a Petrotrin contractor, which will provide jobs to T&T nationals. Hwang, who has been in T&T for only six months, said, "In recent years, we do not see any Korean companies moving into the Trini market, but that does not mean it's not possible. That will be my homework."