The 'pali-pali' and insatiable innovation: Korean lessons for Catalan companies

Seoul/BusanLess than a decade ago, South Korea was still often compared to Thailand or other Southeast Asian countries in business terms. The truth is that the Republic of Korea has experienced what they call an "economic miracle," achieving the title of the world's seventh largest exporter in 2021. With a cutting-edge technology industry and an administration characterized by its speed (pali-paliThanks to its industrialization and collaboration with the private sector, South Korea has positioned itself in recent years as one of the world's major industrial powers, with companies like Samsung, LG, SK Telecom, and Hyundai in its portfolio. It has a higher GDP per capita than Spain, at €33,491 according to official 2024 data, and its unemployment rate is below 3%. The lessons that South Korea can offer Catalan companies are numerous and include a strong commitment to industry as the main economic driver, world-class infrastructure, an education system focused on research and innovation, and a deep pride in their country and its culture. HallyuA concept that encompasses everything related to Korean culture and has placed them on the global map.

FemCAT, the private foundation of Catalan businesspeople, has chosen this country this year for its traditional trip to benchmarking The mission included around thirty business leaders, representatives from the academic world (including the four rectors of the main Catalan public universities: UAB, UB, UPF, and UPC), and journalists, with visits to companies such as Naver, Busan Port, Pangyo Techno Valley, Poongsan Ulsan Plant (a copper processing plant), and the university. Representatives from Catalan companies such as La Farga, BonÀrea, RACC, Hablemos Telecom, TADE, Fredvic, Mullor, and Grupo Gepork participated. This, along with several meetings with Catalans living there, such as Samsung's strategy director Ignasi Torguet, entrepreneur Carlos Kik, professional dancer Alessandro Navarro, and the president of the Spanish Chamber of Commerce in Korea, Roger Royo, lays the groundwork for understanding how Korea has re-emerged from the crisis. Among the conclusions, FemCAT president Oriol Guixà pointed out, is their industrial policy and innovation: "The context is very different from that of Catalonia, firstly because Korea is a sovereign country and Catalonia is not. Furthermore, they are an economy that has believed in industry as the engine of the country," he maintained.

The Korean miracle

During the Korean War (1950-1953), the devastation wreaked havoc on the country's economy: 50% of manufacturing and 40% of homes were destroyed, and the overall damage was equivalent to 83% of Korea's 1953 GDP, according to data from Taekyu Lee's Eco. After the war, a new government took office in 1961 with a very ambitious economic development plan, which allowed Korea to experience four golden decades, during which GDP per capita grew, on average, between 9% and 10%, well above the rest of the Pacific, the European Union, and even [BK_SLT_LNA]. The keys to this great growth, as Dr. Lee explained during a dinner organized by the Poongsan Corporation, lay in an economy led by private enterprise: "Korea did not depend on government-owned corporations, but rather placed private companies at the center of its industrial policy." The balance was as follows: "The government provides the infrastructure, and companies provide the speed and innovation," Lee explained. "It is the market, not the government, that leads the economy," KDI professor Wook Sohn also stated during his introduction to the country. However, this principle yields figures that, depending on how you look at it, can be controversial: the weight of private enterprise in Korea is such that Samsung alone accounts for more than 20% of South Korea's GDP.

Another characteristic of this country is its adaptability: decade after decade, it has steered its industry toward market demands. In the 1960s, Korea focused more on light industries, such as food, textiles, and construction; in the 1970s and 80s, it concentrated on heavier and chemical industries; in the early 2000s, it prioritized semiconductors and the mobile phone industry, and currently, it is focused on batteries, AI, and digital transformation. "Investment in R&D, technological localization, and global expansion have fueled the country's strong productivity growth," Lee noted. Exports are therefore one of its driving forces: the Port of Busan, also visited by FemCAT during their stay, is the second most important in the world for container transshipment, and is now preparing an ambitious expansion with which it aspires to exceed 13.5 million TEUs (each TEU is equivalent to a 38 cubic meter container) by 2030.

'Pali-pali' and anti-bureaucracy

Korean efficiency is based on a predominance of culture pali-paliwhich in Korean means Quick, quickEverything in this country moves at supersonic speed: the bureaucracy, starting businesses, the grants, and the new initiatives. "I created my company in just 30 minutes," explained Carlos Kik, a Catalan entrepreneur based in Seoul who, with the help of Pangyo Tech Valley (the Korean Silicon Valley), created his sixth startup and was the first recipient of the Korea Startup Visa, a special visa for entrepreneurs. "When I first landed in Korea in 2019, the first word I learned was precisely..." pali-pali“That’s how it is here,” Kik explained. “Four of the six startups I’ve created were founded in Barcelona, ​​but everything is very slow there.”

“There’s a lot of support in Korea, nothing like Catalonia,” he asserted. “If we Catalans want to be leaders, we have to invest the resources, be faster, be faster, be faster—nobody can imagine it,” Kik concluded. “Korean society is super-technological; everything runs on apps, everything is hyperconnected and interconnected,” Kik said. This makes it very quick to assess market reception, because everyone is very open to trying new things,” the entrepreneur says. However, to reach these levels of innovation, education is key. One of the darker aspects of this society is the constant competitiveness of talent, even from a young age: “From a young age, they compete with each other to be the best,” explained some residents in Seoul. Nevertheless, the result is that approximately 90% of people go to university. Furthermore, education is very industry-focused. KAIST, the Korea University of Science and Technology, is an example; it is often compared to the Korean MIT. It aims to lead “the industry of the future,” with pillars such as creativity, advanced post-AI research, globalization, value creation, and a shared vision based on trust. Hallyu and K-pop

If there's one thing Koreans have, it's a strong sense of pride in their nation and culture. HallyuK-pop, as they refer to everything encompassing their national customs and cultural productions, be it food, audiovisual content, or K-pop music, has become another of the country's attractions in recent years and has established itself as a global phenomenon. "The song of Gangnam Style "It was launched in 2012 and was the first major global phenomenon of Korean origin, followed by groups like BTS, Blackpink, and many others," explained KOFICE researcher Hyunji Lee.The squid game It also put Korea on the map in the audiovisual sector, and the Demon Hunter K-Pop (the Netflix-produced film inspired by Hallyu "The fact that it has been the most-viewed video in the platform's history has sealed its fate," the researcher pointed out. Furthermore, the export of content... Hallyu It has increased by 313% between 2010 and 2023.

The reason? Innovation applied to cultural productions. "During the Covid pandemic, companies took the opportunity to implement new technologies and create more innovative productions, and a strong connection has also been achieved between the Hallyu "And what is exported," Hyunji Lee pointed out. The beauty sector, and especially skincare,skincare Korean culture is also a major global phenomenon, fueled by cultural and industrial exports. Furthermore, South Koreans hold their language in high regard: "We've found that on many visits, they provided us with a Korean guide and an English translator, instead of the guide speaking directly in English; they do this to preserve their language and it demonstrates the country's strong sense of identity," reflected David Marín, businessman and former president of FemCAT. "We've seen a national strategy based on innovation, but also on communication: they know how to market themselves very well and have a strong sense of pride," reflected Roger Polls, CEO of Mullor and member of FemCAT.

However, South Korea still faces some challenges, mainly due to its geographical location, which places it in the middle of the trade war between the United States and China. "Currently, the Korean economy is stagnating and has the lowest fertility rate in the world, which poses a threat to Korean society," noted the professor from KERI. For this reason, the country is pursuing a new industrial policy based on strategic technologies with a greater impact on the national economy, such as quantum computing, AI, hydrogen, and robotics, and is also beginning to base part of its economy on cultural exports. "They have a problem with China and the US, but they have decided to combat it with innovation," emphasized Mercè Mullor, CEO of Mullor SA.

Josep Mateu, president of the RACC, summarized it thus: "They have been able to build a very strong economy since the 1960s based on sound planning and a great capacity for adaptation from within the business sector. They have known how to define collective priorities, diagnose the situation, and share it; now they want to do it again." In turn, the president of Parlem, Ernest Pérez-Mas, concluded: "We must be able, from Catalonia, to create a national plan like the Koreans have done, and determine how key policies such as those related to industry and taxation should be implemented." Although Korea is not perfect and its social dynamics are very different from ours, the Catalan government has already assigned work to Catalan companies. And, above all, pali-pali.