Two months after his appointment as Chilean Ambassador to South Korea, Mathias Francke talked to ChileCarne about the opportunities for Chilean pork in that market, the benefits of the FTA between the two countries –which is currently being updated– and the public and private efforts planned for 2023-2024.
He also commented that he met with ChileCarne to learn more about the sector’s current work, its future plans and projects, and especially what is being done on critical issues such as sustainability, food safety, antibiotics use, waste management, and care for the environment. In his opinion, the Chilean pork industry is doing an excellent job and needs to keep up the work on these areas, even though it is difficult and takes time and resources, to maintain their position in sophisticated markets such as South Korea.
– South Korea is a key market for Chilean pork. Based on your vast experience in trade policy, what opportunities do you see to continue growing Chilean agri-business in that country, particularly pork?
South Korea has been an important market and we expect that to continue. We want to strengthen the presence of Chilean products and foods in the South Korean market, especially in times of food insecurity and high food prices like these. We want to establish and strengthen a long-term relationship with Korean consumers by providing them preferential and stable access to food.
Chile is very well positioned in the South Korean market with various products. Of course Chilean pork, belly in particular, is highly valued, as we are one of the main suppliers. We are also the main supplier of table grapes, wine, cherries, and other food products; hence the need to strengthen the bilateral relationship.
We are trying to open markets of specific products that need health authorizations, markets in which we believe Chile has enormous potential, but we need those permits and that is why we are in conversations with the relevant authorities. In fact, a delegation from the Chilean Agricultural and Livestock Service (SAG) and the Chilean Exporters Association (Asoex) visited Seoul last month to discuss these issues; how to facilitate agricultural and livestock trade, health permits, and digital certification. Facilitating customs and health processes further is key.
We also discussed with ChilePork and ChileCarne how to keep working in the South Korean market. Today, pork has one way to enter, one distribution channel, but there are possibilities to reach end consumers, for example via supermarkets, where there is still work to do.
– This year marked the 60th anniversary of diplomatic relations between South Korea and 15 Latin American countries, including Chile. Chile was also the first country to sign an FTA with South Korea, in 2004. What have been the outcomes of the agreement for both economies and what opportunities lie ahead?
Chile was the first country to negotiate a Free Trade Agreement with South Korea, the first Chile signed with an Asian country. We were also the first country in South America to recognize South Korea as a country, long before others, in 1949. South Koreans particularly value that fact.
The FTA has allowed foreign trade to double since its entry into force 18 years ago. But the number of Chilean exporting companies and products exported to South Korea has also increased significantly; allowing us to diversify our exports over all these years.
However, the agreement has lagged behind other FTAs signed by both Chile and South Korea with other trading partners, which is why it needs an update.
We started that process a couple of years ago, including concepts such as digital economy, trade facilitation, sustainability, and small businesses, which are included in other agreements signed by Chile. We also want to improve market access for a significant list of products, around 5% of tariff headings which are currently excluded from the agreement. We are working with South Korea to liberate that 5%, which represent around 400 tariff lines, most of which are agricultural products.
– Where should public and private efforts focus their efforts in 2023-2024 to help boost Chilean pork imports and positioning in South Korea?
Chile has always had a strong public-private partnership to promote exports and the internationalization of Chilean companies. The private sector has worked side by side with the public sector to open new markets. For example, I recently accompanied SAG and Asoex to meetings with South Korean officials to discuss their concerns and interests, as well as plan future actions. This joint work has always been effective, and we must continue to promote it.
The Embassy of Chile in South Korea has an office of the Chilean Exports Promotion Bureau (ProChile) headed by a Commercial Attaché and an Agricultural Office given the importance of health clearances for the South Korean market. Both offices work in coordination, also with the private sector and the relevant public agencies.
We are a channel for opening doors, for holding political discussions, and my door and the Embassy’s door are always open to the private sector as well as our total support for their internationalization plans in South Korea. This is what I said it to the pork producers and exporters association.
– The South Korean market is especially important for our pork exporters. What advice would you give them during these times of change and various global crises to keep reaching different types of consumers in South Korea?
Well, my experience is still limited since I took office only two months ago. However, during these few weeks in Seoul I have felt the recognition given to Chilean products in the South Korean market, including pork, of course.
I think the trust built between consumers and importers with exporters and producers on the other side of the Pacific is key. Our companies have had that vision, of becoming reliable suppliers at reasonable prices. Because in a globalized and interdependent world, an exporter or producer that does not keep their word is quickly replaced with another, not necessarily from Chile. As you well know, competition with other pork producing countries is fierce and that is why our producers must continue to present themselves as reliable suppliers of food products on a daily basis.
And reliable not just by complying with the requested delivery times, quantities, and conditions but also in terms of sustainability, food safety, product traceability, and compliance with internationally recognized standards. In other words, offering a safe and high-quality product. Today, the South Korean consumer is very aware of these topics when making a purchase decision and that is why the Chilean industry has to keep focusing on food safety and sustainability.