From Decline to Revival: Strategies for Revitalizing the Korean Textile and Clothing Industry

Hoon Park ()
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Hoon Park: Korea Institute for Industrial Economics and Trade, Postal: Sejong National Research Complex, Korea Institute for Industrial Economics and Trade, 370 Sicheong Dae-ro C-dong 8-12F 30147, Republic of Korea, https://www.kiet.re.kr

No 24-24, Industrial Economic Review from Korea Institute for Industrial Economics and Trade

Abstract: The South Korean textile and clothing industry is grappling with a perfect storm of challenges. Weak industrial competitiveness has led to a decline in exports and increasing consumer preference domestically for imports amid an ongoing economic downturn. Domestic firms’ productivity and profitability have tumbled due to a lack of technological innovation, a reliance on low-value added products, a dearth of exportoriented products, and an industrial structure dominated by small enterprises. The Korean government has continued to support the development of high value-added and high-performance technical textiles, hoping to foster them as a next-generation growth engine. But the technical textiles sector has thus far failed to blossom into an export industry, and firms remain dependent on imports of advanced textiles. The Korean textile and clothing industry is stuck in a nutcracker dilemma, with higher prices than lower-cost competitors such as China and weaker technology than advanced countries such as Japan and Germany. To address these challenges, this paper identifies policy measures capable of revitalizing the Korean textile and clothing industry, prying it out of the nutcracker. By strengthening its global competitiveness and pioneering global markets, particularly in high-value advanced technical textiles, the industry can position itself for future growth.

Keywords: textiles; textile industry; textile technology; technical textiles; textile processing; textile manufacturing; Korea; KIET (search for similar items in EconPapers)
JEL-codes: L52 L60 L67 (search for similar items in EconPapers)
Pages: 16 pages
Date: 2024-09-01
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