9 out of 10 Manufacturing and Distribution SMEs Suffer from C-Commerce

[Financial News] More than 9 out of 10 manufacturing and distribution SMEs have experienced damage due to the entry of Chinese e-commerce platforms such as Ali, Temu, and Shein into the domestic market.
The Korea Federation of SMEs announced the results of a 'Survey on the Status of SMEs Responding to the Entry of Chinese E-commerce Platforms into the Domestic Market' conducted on 300 manufacturing and distribution SMEs on the 23rd.
According to the survey, 96.7% of the responding SMEs said they experienced damage due to the entry of Chinese e-commerce platforms into the domestic market. Only 3.3% said they had 'hardly experienced any damage'.
By type, the most common response was 'damage due to reduced price competitiveness from the influx of low-priced, duty-free products from China' at 59.0%. This was followed by △intellectual property rights infringement (17.0%) △illegal resale of overseas direct purchase products (16.0%) △aggravation of reverse discrimination due to overseas direct purchase products without certification and post-management obligations (4.0%), among others.
However, although the majority (79.0%) of SMEs experienced damage due to the entry of Chinese e-commerce platforms, they answered 'did not respond specifically'. Reasons included △believing that the cost and effort of responding outweigh the damage amount (35.4%) △difficulty in proving damage or collecting related materials (27.4%) △lack of information on related institutions or departments (15.6%).
Regarding the abolition of the duty-free system for small goods, which is mentioned as one of the countermeasures, 71.7% were in favor, more than twice as many as those opposed (28.3%). The duty-free system for small goods exempts customs and value-added tax on products below a certain amount (under 150 dollars) for overseas direct purchases.
Regarding necessary government support other than the reorganization of the duty-free system for overseas direct purchases, 'mandatory certification and regulation of overseas direct purchase goods' was the most common at 48.7%.
Moon-gap Chu, head of the Economic Policy Division at the Korea Federation of SMEs, said, "The government should promptly prepare effective countermeasures such as supplementing the duty-free system for small goods, addressing product certification issues, and blocking illegal distribution so that SMEs can compete in a fair environment."

butter@fnnews.com Kang Kyung-rae Reporter