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The Changing Structure of the Korean Textile and Clothing Industry and Policy Tasks

Author

Listed:
  • Park, Hoon

    (Korea Institute for Industrial Economics and Trade)

Abstract

The Korean textile and clothing industry has fallen into a positioning trap without any obvious strengths over the checks of advanced countries such as Japan, the United States and Germany and catch-up developing countries such as China and India. The domestic production base has shrunk as companies expand overseas investment to improve price competitiveness through cost reductions while neglecting facility investment for the production of new products and expansion of new facilities. In addition, the Korean textile and clothing industry has not only declined in terms of profitability but also in terms of productivity due to a lack of technological innovation capability, a lack of high value-added products and a reorganization of the industrial structure centered on small companies with low productivity and low profitability. With the advent of the 4th Industrial Revolution, advanced countries are using 4th Industrial Revolution technologies and smart factories to increase the productivity and efficiency of logistics and distribution, but the Korean textile and clothing industry has utilized these technologies at negligible levels. The government has continued to support the development of high value-added and high performance technical textiles to upgrade the industrial structure, but technical textiles have not grown into export industries and still demonstrate high import dependence. In this regard, this study will identify policy tasks that will enable the Korean textile and clothing industry to escape from the positioning trap between advanced and developing countries and to develop into a growing industry by developing a high value-added market currently occupied by advanced countries.

Suggested Citation

  • Park, Hoon, 2020. "The Changing Structure of the Korean Textile and Clothing Industry and Policy Tasks," Industrial Economic Review 20-4, Korea Institute for Industrial Economics and Trade.
  • Handle: RePEc:ris:kieter:2020_004
    as

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    More about this item

    Keywords

    textiles; clothing; textile industry; fashion industry; Korea;
    All these keywords.

    JEL classification:

    • L67 - Industrial Organization - - Industry Studies: Manufacturing - - - Other Consumer Nondurables: Clothing, Textiles, Shoes, and Leather Goods; Household Goods; Sports Equipment

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