SK doubles contribution of exports from Korea in 5 years

SK Group Chairman Chey Tae-won, right, inspects a production line at SK hynix’s plant in Icheon, Gyeonggi Province, in this August 2015 file photo. After acquiring SK hynix in 2012, SK Group saw its exports surge to raise its contributions for the export-driven Korean economy. / Courtesy of SK Group

By Kang Seung-woo

SK Group has cemented its billing as one of the nation’s top export companies thanks to strong performances from its affiliates ranging from energy and chemicals to information and communications technology (ICT).

According to Korea’s third-largest conglomerate, Sunday, the total volume of exports from SK affiliates was $52.4 billion (59.6 trillion won) in 2016 and it accounted for 11 percent of the nation’s overall outbound shipment of $495.4 billion.

The news came in time for the 64th anniversary of SK, which started as a textile firm in 1953.

SK hynix, which was acquired in 2012, is the latest addition to help the business group boost and widen its export earnings steadily.

The conglomerate said that the combined exports from its ICT subsidies — SK Telecom, SK C&C, SK Planet and SK hynix — reached 17 trillion won last year.

It is a sharp increase compared with 130 billion won in 2011 made by the ICT affiliates without the chipmaker.

After taking over hynix, SK has seen the collective exports from its ICT units go on the upswing _ 9.5 trillion won in 2012, 16.2 trillion won in 2014 and 17 trillion won in 2016. The 2016 tally represented 30 percent of the group’s total exports.

Even SK C&C, largely regarded as a domestic-facing company, made 760 billion won from exports in 2016.

The increase from the ICT sector is mainly attributed to SK Chairman Chey Tae-won’s bold decision to expand the business portfolio that was heavily focused on energy and chemicals.

Following the acquisition of hynix, Chey increased the firm’s R&D budget from 834 billion won in 2011 to 2.09 trillion won last year.

In addition, the world’s second-largest memory chipmaker is set to invest 7 trillion won this year, much of which is likely to be funneled into the development of more advanced chips.

Plus, SK Group is committed to artificial intelligence (AI) amid the Fourth Industrial Revolution taking place globally.

SK Telecom, the nation’s top mobile carrier, recently set up a division devoted to developing AI-related technologies under direct control of its CEO and it is also working to offer integrated ICT services, including autonomous vehicles and quantum cryptography.

SK C&C has also tapped into the local medical industry with its AI system powered by IBM’s Watson for the diagnosis and treatment of cancer.

With the ICT affiliates putting up solid numbers, its conventional cash cows also remain competitive on the global stage.

The subsidies in the field of energy and chemicals posted 51.3 trillion won in sales and 30.2 trillion in exports last year despite the lingering global slump in these industries.

Particularly, they have formed partnerships with global companies to expand overseas markets, while minimizing risks, under the growth strategy of “Global Partnering.”

“Since the acquisition of SK hynix in 2011, SK Group has steadily contributed to the nation’s exports, accounting for more than 10 percent,” said SK Senior Vice President Lee Hang-soo, who leads the group’s public relations team.

“On the back of the group’s 64 years of experience, we are determined to keep contributing to the nation’s economy with export-centric policies.”

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