- Log In/Sign Up
- P-ISSN1738-3110
- E-ISSN2093-7717
- SCOPUS, ESCI
ISSN : 1738-3110
The Expansion Strategy for the New Route between Korea and Hungary
Abstract
Purpose - The competitiveness of logistics in the 21st century rests on ensuring the efficiency and effectiveness of its local hub. While considering entry into a niche market in local logistics, it is pertinent to note that Budapest is emerging as a hub in EU enlargement in Eastern Europe. Big, small, and medium-sized businesses in Korea entered Hungary in the early 1990s since then, there has been a significant increase in Korean presence, of approximately 130 times. This study aimed to identify the key distribution issues that have emerged in relation to Eastern Europe. Research design, data, and methodology - This study indicates that 33 major Korean companies were located in Hungary, which serves as an out post to enter the European marketplace. However, Korea's exports to Hungary have declined (-32.0% in 2012) because of a loss of competitiveness against multinational corporations, due to factors such as the rise in current local distribution costs and wages. Hungary, on the other hand, through diversification and expansion of foreign trade with the non-EU markets, including Korea, is increasing its exports. Strategies of emerging countries are compared and reviewed in this study, by examining the vicissitudes of Hungary's distribution methods. Results - There are issues regarding Hungary's innovative ability. Hungary has a history of low wages and high skilled labor. However, the outflow of high-quality human resources for high-wages has become more extensive, and this underlines concerns that the CEE's trade hub is moving to neighboring countries. After the European financial crisis in 2010, the Hungarian economy is now developing, because of the IMF's measures, and it is being transformed into a trade surplus nation, while regaining distribution volumes rapidly. However, if there is continued lack of investment, the supply chain is weakened and exports decline amidst competition with TNCs or with China's distribution networks. Conclusions - It is necessary to create a new logistics approach for increasing trade between Korea and Hungary. First, Korean small and medium enterprises (SMEs) should build trust by working with advanced Hungarian talent, and they should expand into state-of-the-art fields instead of being confined to traditional sectors. Second, this study focuses on limiting and lowering their high expectations for success according to foreign direct investment (FDI) inflows and the role in the CEE distribution hub Korea should try to strengthen the distribution hub with its centralized population, using better, more highly educated human resources, thereby sustaining more innovative ability. Further, the positive effects of these measures are manifested in enhanced business on both sides of Hungary, namely, the EU and non-EU nations such as Turkey and emerging markets around Europe, and a better engagement in the core placement of culture and industry. For this, Korea can contribute to, and benefit from, a Hungarian logistics center, for adopting the high-tech cluster systems and commercializing distribution technology such as RFID·USN.
- keywords
- CEE Hub, New Route, Non-EU Trade, Distribution-Egde, SME Supply Chain, Technlogy-Cluster
Reference
Collier international (2014). European logistics report. White paper. 3, 3-4,Retrieved May 1, 2014, from http://www.colliers.com/en-gb/emea/insights/the-futur e-of-the-european-logistics-market#.U55XWBYbYs4.
Éltetö, A., & Völgyi, K. (2013). Integrated in the global value chains - trade developments between Hungary and Asia. Eastern Journal of European Studies, 4(1), 57-79.
European Commission (2014). Infrastructure-TEN-T-Connecting Europe What do we want to achieve?. Brussels, Belgium: Mobility and Transport, Retrieved May 2, 2014, from http://ec.europa.eu/transport/themes/infrastructure/index_en.htm.
Eurostat (2014). Key figures on the enlargement countries 2013edition, Eurostat poketbook. Luxembourg: Publications Office of the European Union..
HITA (2014a). Hungary an ideal location for distribution centers, Logistics. 12-15, Retrieved May 5, 2014, http://www.hita.hu/Publication.aspx.
HITA (2014b). Investing Guide Hungary 2014, PWC, Budapest. 13-25. Retreved May 5, 2014, http://www.hita.hu/Publication.aspx.
Hungarian Central Statistic Office (2014). International goods transport in Hungary (2001–2013), Statistic Data. Retrieved May 15, 2014 from http://www.ksh.hu/docs/eng/xstadat/xstadat_annual/i_odmv002.html.
Hungarian Chamber of Commerce & Industry (2014). Infrastructure and Transport, Budapest. 1-3. Retrieved May 7, 2014 from http://www.mkik.hu/en/magyar-kereskedelmi-es-iparkamara/infrastructure-and-transport-2631.
Kim, J.H. (2011). Studies on Sustainable Policies of European Intermodal Transport System. Journal of Distribution Science, 9(2), 25-30.
KITA (2013). General import and export - Data, Korea trade statistics. Retrieved May 5, 2014, http://stat.kita.net/top/state/main.jsp?lang_gbn=null&stati d=kts#none.
Kotra, KBC in Budapest (2014). Hungary, EU funded projects go closer to the EU standard, Globalwindow. Retrieved April 15, 2014, http://www.globalwindow.org/gw/overmarket/GWOMAL020M.html ?BBS_ID=10&MENU_CD=M10103&UPPER_MENU_CD=M10102&MENU_STEP=3&ARTICLE_ID=5014469&ARTICLE_SE=2030
Kovács, K. (2013). US Screening and Evaluation system of Inventions Utilized in Hungary, Budapest Management Review, 44(10), 24-36.
Losoncz, M. (2011).Continuity and Discontinuity in the Interaction of Regional and Corporate Cultures: Potsdam (Germany)and Győr (Hungary). European Planning Studies, 19(11), 1995-2008.
Mo, L., & Zhai, S. (2012). The Effects of County-of-Origin, BrandImage, and Corporate Image Dimensions on Brand Evaluations and Purchase Intentions of Smart Phones of Five Brands: A Comparative Study of China and Korea. Journal of Distribution Science, 11(7), 47-56.
NDA (2007). National Strategic Reference Framework of Hungary 2007–2013, the new Hungary Developement Plan. Retrieved May 7, 2007, http://www.mrrfeu.hr/UserDocsImages/EU%20fondovi/partne rske%20konzultacije/National_Strategic_Reference_Framework_2012___2013_1.pdf.
Svatoš, M., & Smutka, L. (2012). Development of Agricultural Trade of Visegrad Group Countries in Relation to EU and Third Cou,ntries, Agris On-Line Papers in Economics & Informatics, 4(3), 55-69.
Szakálné Kanó, I., & Vas, Z. (2013). Spatial Distribution of Knowledge-Intensive Industries in Hungary, Transition Studies Review, 19 (4), 431-444.
- Downloaded
- Viewed
- 0KCI Citations
- 0WOS Citations