South Korea’s exports maintained growth momentum last month as demand from China increased and semiconductor sales stayed resilient.
The value of shipments adjusted for working-day differences increased 4.3 percent from a year earlier last month, according to data released yesterday by the South Korean Ministry of Trade, Industry and Energy. That compared with a 3.7 percent rise initially reported for the full month of November.
Unadjusted exports rose 6.6 percent while overall imports increased by 3.3 percent, resulting in a trade surplus of US$6.5 billion.
Photo: Reuters
The up-tick offers some solace for a nation undergoing its biggest political upheaval in years. South Korean President Yoon Suk-yeol was impeached after shocking the nation by briefly declaring martial law on Dec. 3. South Korean Prime Minister Han Duck-soo was also impeached for refusing to quickly appoint judges to deliberate on Yoon’s impeachment. South Korean Minister of Finance Choi Sang-mok has stepped in as the second acting president.
The turmoil has sent the won to its lowest level since 2009, while South Korea’s stock markets also remain fragile. A Jeju Air plane crash on Sunday that killed all but two of 181 people on board might further dent consumer sentiment.
South Korea, which relies heavily on exports to drive its economic growth, also faces external challenges. US president-elect Donald Trump has promised an array of protectionist policies, including universal tariffs, as he prepares to return to the White House.
Bank of Korea Governor Rhee Chang-yong sees the economy growing this year less than the 1.9 percent forecast previously, and economists increasingly expect the central bank would go ahead with another cut this month as consumer and business confidence slump.
Weaker export momentum poses a threat to the won, and the nation’s semiconductor industry might experience slower demand this year after enjoying a boom from artificial intelligence development.
Chip exports increased 31.5 percent from a year earlier last month while shipments of cars fell 5.3 percent. Sales of wireless communication devices rose 16.1 percent, the trade ministry said.
Exports to China increased 8.6 percent, reversing from a contraction a month earlier, the ministry said. Shipments to the US rose 5.5 percent and exports to the EU advanced 15.1 percent.
For the year as a whole, South Korea’s exports rose 8.2 percent last year from a year earlier, the ministry said, adding that the trade surplus amounted to US$51.8 billion. Semiconductors, the biggest driver of exports, sold 43.9 percent more than in 2023, it said.
The outlook for this year is less bright. Exports are likely to grow 2.2 percent from a year earlier, while the trade surplus is set to reduce to US$48.7 billion, the Korea Development Institute said in a November forecast.
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