- Korea’s August exports surpass $50 billion for first time 2018-09-01
The Ministry of Trade, Industry and Energy announced on September 1 that exports last month expanded 8.7 percent year-on-year to USD 51.2 billion, surpassing $50 billion for the first time for August exports. Exports in the first eight months also reached a record high of $399.8 billion, up 6.6 percent from the same period last year.
Average daily exports also hit an August record high of $2.1 billion, and won-denominated exports increased 7.8 percent to 57.4 trillion won.
The increase in outbound shipments in August is attributable to robust performance of global manufacturing industries, gross domestic product (GDP) growth in leading economies, and rising prices of oil and major export items.
Imports rose 9.2 percent to $44.3 billion, achieving growth for the 22nd straight month. Trade surplus stood at $6.9 billion, allowing the country to remain as a net exporter for 79 consecutive months.
Trade, Industry and Energy Minister Paik Ungyu stated that average monthly export growth for the second half of this year would remain at 5 percent, which would enable the annual exports to top $600 billion for the first time. However, he added that rising trade protectionism and uncertainty in emerging markets due to interest rate hikes by the U.S. Federal Reserve are putting pressure on exports. The Ministry will respond to downside risk factors by continuously monitoring relevant events with a task force, seeking multilateral cooperation in opposing trade protectionism, and diversifying export markets, according to Minister Paik.
A breakdown of exports shows that ten out of Korea’s 13 major export items saw growth. They are petroleum products, semiconductors, steel, petrochemicals, general machinery, computers, displays, textiles, auto parts, and automobiles. Exports of the first six categories grew at double-digit rates.
Exports of semiconductors soared 31.5 percent year-on-year to the highest record of $11.5 billion, posting the 23rd consecutive growth. Despite slowing prices, the growth could be achieved by newly launched smartphone models and greater memory capacities.
Outbound shipments of petrochemicals jumped 17.0 percent to a record $4.3 billion. Increased oil prices and fewer maintenance events led to more supply, resulting in exports of more than $4 billion for nine consecutive months.
General machinery exports went up 16.3 percent to $4.3 billion, expanding for six straight months. The expansion was largely due to strong performance of construction and manufacturing sectors in the U.S., China, and other major export destinations.
Overseas shipments of petroleum products spiked 46.3 percent to $4.2 billion, increasing for 22 straight months. They were above $3 billion for the tenth consecutive month. This is attributable to higher product prices that resulted from rising oil prices. Association of Southeast Asian Nations (ASEAN) countries and Japan were the main importers.
Steel exports rose 20.7 percent to $3.18 billion, thanks to increased orders of maritime steel structures, higher product prices, and diversified export markets. Exports to the Middle East and India increased 294.8 percent and 31.2 percent, respectively.
Outbound shipments of computers increased 11.7 percent to $934 million, growing for 17 straight months. Higher demand for solid-state drives (SSDs) for businesses and increased replacement of personal computer parts contributed to this growth. Especially, sales in the European Union and Vietnam improved by 10.7 percent and 25.9 percent.
Meanwhile, exports of wireless communication devices, ships, and home appliances saw decreases because of fiercer competition and increased overseas production.
Among outbound shipments of high-value, high-tech products that the Ministry separately keeps track of, organic light-emitting diodes (OLEDs) and SSDs achieved growths. However, exports of multi-chip packages (MCPs) experienced a decline.
OLEDs grew 52.5 percent to a monthly record of $1.3 billion on the back of higher sales of premium televisions and smartphones in ASEAN countries, such as Vietnam.
SSDs inched up 2.1 percent to $548 million, thanks to higher demand for both servers and personal computers, and many newly introduced products.
MCPs slipped 6.6 percent to $1.8 billion due to heightened competition in China.
By region, exports to China, ASEAN, the U.S., Vietnam, Japan, Central and South America, and the Commonwealth of Independent States (CIS) expanded. Outbound shipments to all of these destinations, except for the U.S. and Central and South America, posted double-digit growths.
In particular, exports to China rose 20.8 percent to a record $14.4 billion, expanding for 22 straight months. Those to Japan also increased for the tenth consecutive month.
For imports, inbound shipments of crude oil and liquefied natural gas expanded 44.2 percent and 39.4 percent, respectively, due to rising oil prices. Purchases of gasoline-powered cars and pharmaceuticals also increased 22.5 percent and 5.3 percent, respectively, as domestic consumption increased.