The Journal of Economics, Marketing and Management (융합경영연구)

International Convergence Management Association (국제융합경영학회)
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South Korea's Strategic Directions in the Context of the US-China Trade War: An Application of the ABCD Model

  • Dilong HUANG (Seoul Business School, aSSIST University) ;
  • Hwy-Chang MOON (aSSIST University) ;
  • Guy Major NGAYO FOTSO (The School of Management Fribourg (HEG-FR), University of Applied Sciences and Arts of Western Switzerland (HES-SO))
  • Received : 2024.04.15
  • Accepted : 2024.04.23
  • Published : 2024.04.30
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Abstract

Purpose: South Korea is a close ally of the US and an important partner of China. Caught between the two most powerful countries, South Korea's strategic directions are critical. This article emphasizes that the deeper core of the US-China trade war is to improve the business environment to attract foreign direct investment (FDI) to boost the economy, rather than engaging in the trade war. Research design, data, and methodology: Considering the complexity of this issue, this article applies a systematic analytical tool, the ABCD (Agility, Benchmarking, Convergence, and Dedication) model, to provide strategic guidance for inducing investments into South Korea in the context of the ongoing US-China trade war. Results: Specifically, South Korea needs to provide a more attractive business environment along the four points: expedite commercial activities through deregulation (Agility); adopt global standards of the flexible labor markets and technological developments (Benchmarking); integrate various industries and connect them to global value chains (Convergence); and create more economy-friendly policies rather than politics-oriented ones such as protectionism (Dedication). Conclusion: This study stands out not just by utilizing the ABCD model but, also by providing more systematic analysis and practical implications, particularly within the context of the escalating US-China competition. Unlike many existing studies that analyze the broader impacts of this geopolitical rivalry, this research delves into specific strategic guidelines for South Korea to attract FDI. The findings also provide implications for multinational corporations (MNCs) in choosing the locations for their overseas operations, particularly in South Korea.

Keywords

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