A view of the container terminal at Busan Harbor on Tuesday (Yonhap)
SEJONG -- South Korea suffered a negative growth in exports for the first time in two years in the wake of sharply contracted demand for semiconductors around the globe and China’s economic slowdown, state data showed Tuesday.
According to the Ministry of Trade, Industry and Energy, the nation’s exports posted $52.4 billion in October, falling by 5.7 percent compared to a year earlier.
This monthly tally marked the first decline in two years since its outbound shipments fell by 3.9 percent in October 2020, when COVID-19 was hitting the world at a high speed.
As a noteworthy case, exports of semiconductors, Korea’s biggest export item, declined by 17.4 percent on-year last month. This was attributed to a drop in semiconductor prices.
The nation saw exports of semiconductors drop for the third consecutive month, followed by 7.8 percent in July and by 5.7 percent in August, data from the Industry Ministry showed.
In addition, shipments of petrochemical products decreased by 25.5 percent, steel by 20.8 percent, displays by 7.9 percent, mobile telecommunications by 5.4 percent and computers by 37.1 percent. A 19.1 percent drop was seen in textiles, negative growth of 22.3 percent in home appliances and 16.7 percent in rechargeable batteries.
By destination, shipments to China fell by 15.7 percent, the Association of Southeast Asian Nations by 5.8 percent, Japan by 13.1 percent, South & Central Americas by 27 percent and the Middle East by 6.5 percent.
Nonetheless, exports to the United States and the European Union increased by 6.6 percent and 10.3 percent, respectively.
Korea’s imports increased 9.9 percent on-year to log $59.1 billion in October amid spiraling raw material prices, under which the nation posted a trade deficit of $6.7 billion.
The nation suffered a trade deficit for the seventh consecutive month, which marked the first time in about 25 years since it posted a protracted deficit between January 1995 and May 1997.
“Downside risks are expanding over the world economy due to (factors like) inflation and the war between Ukraine and Russia,” Industry Minister Lee Chang-yang said in a statement.
Citing unfavorable external factors, he predicted that it would be difficult for the nation to see an apparent rebound in export performance on a short-term basis.
“(To overcome the sluggish situation, the government) will carry out full-fledged support to reinvigorate exports by mobilizing any possible means,” he said.
By Kim Yon-se (email@example.com