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S. Korea's export growth to drop to 0% range in 2023: poll

Dec. 19, 2022 - 09:31 By Yonhap

South Korea's export growth is expected to fall to the zero-percent range in 2023 amid high raw material prices and slowing major economies, a poll showed Monday.

The survey of 150 companies in the country's 12 key export industries showed overseas shipments are forecast to expand 0.5 percent in the coming year from 2022.

By sector, exports of electric and electronics products are predicted to sink 1.9 percent on-year, with those of petrochemicals likely to fall 0.5 percent.

Outbound shipments of biopharmaceutical and health products are projected to grow 3.5 percent. Comparable growth rates are 0.2 percent for steel, 0.9 percent for cars, and 1.7 percent for general machinery and ships.

Of the total firms, nearly 40 percent projected outbound shipments of Asia's fourth-largest economy to shrink in 2023 from this year due to weakening export competitiveness stemming from high costs and slowing demand from major export destinations.

Local pollster Mono Research conducted the survey, which was commissioned by the Federation of Korean Industries, the lobby for South Korea's family-controlled conglomerates known as chaebol.

Exports, the mainstay of South Korea's economic growth for the past two years, have been losing steam in recent months due to such external negatives as the US Fed's rate hikes and the war in Ukraine.

The country's overseas shipments shrank 14 percent on-year in November, marking the second consecutive month of on-year decline.

It marks the first time since early 2020 that exports have dipped for two months in a row. South Korea last reported declining exports for more than two months from March through August in 2020.

Major economic think tanks in South Korea, including the Korea International Trade Association, predict the country's exports to increase around 7 percent in 2022 from a year earlier.

The survey also showed 53.3 percent of the respondents predicting their 2023 export profitability to be similar to that of this year, with 28 percent expecting a worsening condition. Some 19 percent forecast an improvement.

As to the ways of strengthening the country's export competitiveness, 38 percent replied the government should put top policy priority on providing tax breaks regarding raw material purchases. (Yonhap)