KOREAN NET

The public and private sectors have teamed up to boost the global competitiveness of the domestic cosmetics and beauty sector. Shown is a woman in July last year trying products at a cosmetics store in Seoul. (Yonhap News)

By Kim Seon Ah

Amid the rising popularity of domestic cosmetics and beauty products abroad, the public and private sectors have teamed up to boost the global competitiveness of the sector.

The Ministry of SMEs (Small and Medium Enterprises) and Startups and Ministry of Food and Drug Safety on July 24 said they signed a business deal and jointly announced measures to raise the global competitiveness of cosmetics and beauty SMEs at the headquarters of CJ Olive Young, a domestic beauty and health chain giant, in Seoul's Yongsan-gu District.

SMEs account for a country-leading 63% of cosmetics exports. Last year, overseas shipments of such items made by SMEs posted a record-high USD 5.3 billion, making cosmetics the top export item for such businesses.

Designed to resolve issues SMEs face when shipping such goods abroad and develop related industries, the plan has three strategies: discover and advance public-private cooperation with promising companies in the beauty sector; systematically respond to overseas export regulations and develop the industry's ecosystem.

To this end, the government will search for and incubate promising companies in the sector using the expertise and infrastructure of the private sector.

For example, the K-Beauty Creator Challenge, a collaboration with private platforms, manufacturers and distributors such as CJ Olive Young, Amazon, Cosmax and Komar, seeks to find and develop promising exporters in the field.

Selected companies will receive consulting on marketing and export strategies using the distribution networks and expertise of private collaboration partners. The two ministries will help them through connection with export support policy.

Kolmar and Cosmax will also jointly launch in the form of a fund of funds a "global K-beauty fund" to invest mainly in cosmetics makers advancing abroad.

The government will also raise support for responding to cosmetics export regulations, widen support for data on such regulations in newly emerging markets and ease corporate burden by unifying GMP (good manufacturing practices), the domestic certification standard for superior cosmetics manufacturing and quality control, to the level of the international standard ISO.

The domestic beauty ecosystem will also undergo further advancement to develop and produce innovative products in a speedy manner. And a "K-beauty network loan" will provide policy funds to companies even if they merely have a basic order contract.

"The performance of cosmetics exports is thanks to a solid cosmetic ecosystem harmonized between corporations and SMEs," Minister of SMEs and Startups Oh Youngju said. "We will do our best to help our SME cosmetics brands to gain world premium status that global environmental changes cannot shake."

sofiakim218@korea.kr