There is a ten-year gap between Japanese and Korean IP. Can Korea catch up?

In the past 10 years, South Korea has not been able to get rid of its intellectual property (IP) deficit. On the contrary, Japan has achieved a huge surplus in the past decade. Now that Japan-South Korea relations are awkward, South Korea has also begun to pay attention to IP issues.

According to the Korean media Herald Economy, if the data from the Bank of Korea and the Bank of Japan are compared, in the IP royalties trade records from 2009 to 2018, Japan paid 2.4005 trillion yen in IP royalties to other countries last year, earning 5.225 trillion yen in the same period, with a total surplus of 2.62198 trillion yen.

This amount set a record for Japan's largest IP trade surplus in the past 10 years. Compared with the surplus of 452.7 billion yen in 2009, it is almost 5.8 times that of that year. What is special is that the IP trade surplus in 2013 reached the 1 trillion yen mark, which was also the second year since Japanese Prime Minister Shinzo Abe returned to power.

In a speech delivered at the Center for Strategic and International Studies (CSIS) in the United States in 2013, Shinzo Abe listed IP as a priority policy alongside trade, investment, labor, and the environment. In June of the same year, the Japanese government announced the "Intellectual Property Policy Blueprint", and since then, Japan has formulated new IP promotion policies every year to actively develop the IP field.

On the contrary, South Korea's IP royalties have set a record of trade deficit for 10 consecutive years. South Korea's IP trade deficit last year was US$2.1286 billion. Although it is the smallest deficit in 10 years, it still pays more IP royalties to other countries than it receives.

It is worth noting that South Korea's deficit with Japan last year was as high as US$718 million, accounting for more than one-third of the total deficit. In 2014 and 2015, South Korea reduced its deficit with Japan to US$584 million and US$472 million, but it began to rise after 2016, and in 2018 it hit the largest deficit in seven years.

However, Japan's trade surplus with South Korea last year was 42.9 billion yen, the highest in the past three years.

According to the "2018 Annual Report" recently released by the National Intellectual Property Commission of Korea, based on the PCT international patent application system, the number of applications filed by South Korea was 15,169, and that of Japan was 46,253, almost three times that of South Korea.

South Korean experts believe that in the field of intellectual property, South Korea should narrow the gap with Japan from the institutional perspective. Industry insiders pointed out that Japan's Intellectual Property Strategy Department is centered on the Prime Minister and cultivates the IP competitiveness of various departments, while South Korea's Intellectual Property Committee does not have the authority to evaluate and prepare budgets, and is often restricted in implementing IP policies.

South Korean technology media "etnews" pointed out that the Korean Intellectual Property Committee also emphasized at the 2nd Intellectual Property Rights Day commemoration ceremony held on the 4th that it will improve its ability to respond to domestic and foreign markets in the future and strive to utilize technological intellectual property rights such as artificial intelligence, big data, and smart energy.