Wed, July 14, 2010
Business > Industries

Newly-launched SK China eyes localization as means of expansion

2010-07-14 08:56:53 GMT2010-07-14 16:56:53 (Beijing Time)  Xinhua English

SEOUL, July 14 (Xinhua) -- Upon the launch of South Korea's conglomerate SK Group's affiliate in China, the group seeks to put more stress on the Chinese market and to engage in business from the perspective of the Chinese people.

"We have launched SK China based on the judgment that we need to do business from the viewpoint of the Chinese people while contributing to China's economic growth as a Chinese company," SK Executive Vice President Kwon Oh-yong told Xinhua in an e-mailed interview.

SK China, marking its official launch on July 1, has been set up as South Korea's third-largest business tycoon seeks to concentrate on promoting its business in China and to expand its business base to other emerging markets.

SK, as the first South Korean firm to roam into the Chinese market, has been keeping eye on the market, piling up a 20-year- long experience there, Kwon said.

"Based on our long experience of business in China, we have prudently prepared for the launch of SK China," Kwon added.

The newly-launched SK China's main focus is on new energy, petrochemicals, next generation Information and Communications Technology (ICT), and urban development and environmental projects, all of which it considers as businesses essential for China to emerge as the next global leader, according to the company.

SK China's new plan to newly systemizing its existing business portfolios will "definitely" be accompanied by immense investment in related areas, Kwon said.

According to the company, its investment will amount to around 17.5 trillion won (14.6 billion U.S. dollars) in 10 years, which will be mostly focused on energy and ICT sectors.

Unlike many other peers that have penetrated into China from overseas, SK China seeks to place itself in the market as a " Chinese" company.

"We are going with a big picture to become the center of local professional human resources as a true Chinese company," Kwon said, adding that the company seeks to develop new business lines fit for the Chinese market on the back of SK's world-level technology.

"As part of our move, we will continue with our investment into three core areas, such as energy, environment, and innovative technology," Kwon added.

Highlighting that it ultimately aims to become a respected true Chinese group, the vice president said that SK China seeks to devise a new business model that could contribute to the economic growth of China.

According to Kwon, China will grow into the largest-size economy in the world, with its top-level growth potential.

With respect to downside factors, such as rising personnel expenses and labor relations, SK said that the country is only going through a transitory phase.

"As most of the advanced countries have seen the same problems before, I think uncertainties will fade away as time goes on," said the vice president, reaffirming the company's trust in the country and the market.

"After it passes this transitory period, China will see a larger pace of economic growth, which is what SK pays attention to, " Kwon added.

"China is a country with a strongly-founded culture, which in turn nurtures a strong economy and state, and SK is keenly aware of this," said Kwon.

Amid growing attention on SK China, the group's chairman Chey Tae-won also highlighted that SK China should become a self- sustainable company that can supply necessary resources for its own development.

The move is seen as SK's aggressive move into the market as the group has not been seeing fast progress up until now.

With the progress in the Chinese market, SK Group hopes to show better performances in other emerging markets as it recently refurbished its regional strategies for the Middle East, Latin America and Southeast Asia as well.

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