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Korea's Intellectual Property Deficit Soars |
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2005-01-31 |
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6154 |
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Korea’s royalty payments to foreign countries are snowballing as local businesses depend heavily on foreign technology.
The Bank of Korea said Wednesday that Korea paid US$3.86 billion in royalties to foreign companies for intellectual property and trademark rights from January to November last year, up 18.4 percent on-year. Total payment in royalties for the whole of last year is thus likely to surpass US$4 billion or W5 trillion.
Royalty payments have been on the rise since 2003 after dropping between 2001 and 2002.
The rise in royalties is galvanized by the Korean information technology sector, which increasingly uses overseas intellectual property. According to a report by the Ministry of Science and Technology last year, the information and communication sector accounted for 37.2 percent of the total deficit caused by an imbalance between technology imports and exports.
Meanwhile, Korea earned US$1.49 billion in royalties in the first 11 months last year, up 33.7 percent from a year earlier but still only a third of the country’s royalty payments going abroad. As a result, Korea’s intellectual property deficit rose by W224 million to $2.36 billion in 2004 from $2.14 billion in 2003.
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