Ministry of Trade, Industry and Energy

Export and Import Trends for April 2015

Exports: $46.2 Billion, Imports: $37.7 Billion, Record Trade Surplus: $8.5 Billion   □ Korea’s exports fell 8.1 percent to $46.2 billion and imports decreased 17.8 percent to $37.7 billion in April from a year earlier, resulting in a trade surplus, for the 39 consecutive month, of $8.5 billion. - Exports and imports both continued to decline from January through April this year amid unfavorable conditions such as falling oil prices, lower export prices of key products and slowing global trade growth. -The country’s trade balance posted a record surplus for the third straight month in April.   □ Overseas shipments showed their largest monthly year-on-year decline of 2015 in April due to a drop in shipments of major products such as automobiles, ships and mobile telecommunication devices. - By product, shipments of computers and semiconductors increased, while those of mobile telecommunication devices and automobiles decreased. By region, exports declined for most regions excluding the Middle East amid the global trade slowdown. - The export volume fell slightly in April due to regular maintenance checks at production facilities for oil and petrochemical products, but gained 1.2 percent from a year earlier.   □ Inbound shipmentscontinued to fall in April due to a decline in unit prices of imported major raw materials. - Capital and consumer products, meanwhile, posted good growth.   □ < Factors behind Lower Export Growth in April > ①   Deteriorating export market conditions due to slowing global trade ②   Negative base effect from robust export growth recorded in April 2014 ③   Decline in unit prices of key exports, and regular maintenance checks at production facilities for oil and petrochemical products ④   Worsening conditions for overseas competition in major export markets and for key products due to an acceleration in the fall of the yen and a weakening euro (according to the views of exporters of automobiles and general machinery)   < Outlook and Policy Challenges > - Exports are likely to continue their downward trend in May due to fewer workings days (one less day compared with May last year), a decline in unit prices of key exports and regular maintenance checks of production facilities of oil and petrochemical products. - A rebound in overseas shipments is expected from June thanks to more working days, an expected increase in exports of new automobiles, and the completion of regular maintenance checks of oil and petrochemical output facilities. - The Korean government is preparing measures by looking closely at the competitiveness of major export products in light of recent market and foreign exchange conditions.   Attachment: date2015-05-15

USD 98 mil to be invested into stepping stone projects by 2017

The Ministry of Trade, Industry and Energy (MOTIE) announced on May 6 that it is investing 110 billion won ($98 million) in 12 stepping stone projects by 2017. A stepping stone project refers to the commercialization of interim R&D results in the form of technology and product.     For this year, a total of 31 billion won will be invested in plastic auto tuning parts, fishfinder drones for deep-sea fishing and logistics robots for hospitals and warehouses.     Plastic tuning parts can either be used on high-performance cars and but before the development is completed, they can be used on premium micro cars for children.     Fishfinder drones are a high-speed vertical take-over and landing aircraft that can be used to find schools of fish in the air. They can also be used in various areas, such as monitoring illegal fishing, military surveillance and disaster monitoring.     The logistics robots can be used both at the hospitals and warehouses for public health and safety. The plan is to employ the robots in domestic and overseas hospitals and nursing homes, before using them at hotels and large warehouses. The ultimate goal is to develop robot nurses and remote medical robots.     MOTIE expects to create 3 trillion won market by 2017 once the interim R&D results are commercialized through the stepping stone projects.     * Short version date2015-05-06

Korea and Vietnam sign FTA

The Ministry of Trade, Industry and Energy (MOTIE) announced on May 6 that Korea and Vietnam officially signed FTA after a total of 9 sessions of official talks after the promotion of FTA was agreed at the summit held in 2009.     The Korea-Vietnam FTA is expected to help increase the exports of Korean small and medium-sized material and parts manufacturers, particularly in the areas of textile, home appliances, cosmetics and auto parts thanks to the removal of tariffs on these items.     As for Vietnam, it will be able to attract more foreign investments and promote economy.     At the FTA signing ceremony, Minister of Trade, Industry and Energy Yoon Sang Jik said, "The Korea-Vietnam FTA will make Korean companies invest more in Vietnam, and their investments will help Vietnam's economy grow while also increasing the volume of trade between the two countries. This will be an exemplary case of mutually beneficial FTA for both parties."     * Short version date2015-05-06

Electricity Sales and Retail Sales Trends in March 2015

  □ In March, the volume of South Korea's electricity sales for industrial use decreased from a year earlier despite an increase of a day operated. It is because of fall in steel and textile. The total volume of electricity sales also increased from the previous year due to the rise in heating load and the days operated.   □ Regarding sales by major retailers reported in March, the sales of hypermarkets, department stores, and super supermarkets decreased, because of fewer days operated and drop in clothing sales.   ㅇIn the first quarter of 2015, the sales of hypermarkets, department stores, and super supermarkets decreased, while the sales of convenience stores increased.   date2015-04-30

Automobile Industry Trends for March 2015

  □ The volume of South Korean automobile production and exports decreased by 2.6 percent, while domestic sales increased by 8.8%. This was attributed to recession in overseas markets such as Russia and strong sales of sedans and SUVs in the domestic market.   □ : Production decreased by 2.6 percent from a year earlier to 414,352 units, despite a rise in production for the domestic market. This fall was mainly attributable to reduced production volume due to demand contraction in emerging markets.   □ : Domestic sales decreased by 4.6 percent from a year earlier to 128,103 units. This was attributable to new car models such as Sonata and Tivoli and high demand in multi-purpose vehicles.   - Sales of imported cars increased by 41.3 percent from a year earlier to 23,220 units.   □ : Exports decreased by 2.6 percent from a year earlier to 277,874 units. This was mainly attributable to demand contraction in emerging markets such as Russia, Middle East, and Central America, and intensified competition with Japanese motor companies due to Yen depreciation.   date2015-04-30

Apartment residents to save money on power bills by replacing fluorescent lamps with LED lamps

The Ministry of Trade, Industry and Energy (MOTIE) announced on April 30 that apartment residents can now save on power bills by replacing fluorescent lamps with LED lights in the form of installment payments, where the money saved on the power bill will be deducted from the amount charged on their credit card for the purchase of LED lamps.     So far a total of 21 apartment complexes use this program to replace the fluorescent lamps with LED lamps in the underground parking lots. The number is likely to increase to over 70 before the second half of this year is over.     If underground parking lot lights are replaced with LED lamps at an apartment complex with around 500 households, the residents can save up to 7.36 million won ($6,615) in power bills each year. Since it costs around 20 million won to have the LED lamps installed, it will take about 2 years and 7 months to break even.     Some of the advantages of this program are that it's easy to fund the project, no collateral is needed and an apartment management company can carry out the contract and provide after sales services.     For example, residents of "Seocho The Sharp" apartment have agreed to replace all the fluorescent lamps with LED lamps for their underground parking lots in January this year. Satisfied with the results, they have recently decided to replace all the hallway lights with LED lamps.     MOTIE plans to further promote this program so that gas stations, convenience stores and factories can also save on their power bills by using LED lamps.     * Short version date2015-04-30

South Korea’s FDI Trends in the 1Q of 2015

      □ Foreign direct investmentFDI) to South Korea in the first quarter of 2015 decreased from a year earlier. The declared amount fell 29.8 percent to USD 3.55 billion and the received amount fell 16.4 percent to USD 3.15 billion from a year earlier. In spite of the YoY downturn, the numbers still exceeded the average number of first quarters for the past five years, which are USD 2.87 billion declared and USD 2.01 billion received.   □ - There are a number of positive factors such as the implementation of the Korea-China FTA, which will lead to increased demand in investing on businesses outbound to China, massive potential investments resulting from M&As that are soon to take place, and additional integrated resorts being planned.   - South Korea plans to achieve $ 20 billion in FDI for the first time in 2015. To this end, the country will make diversified efforts starting in May. They will include visits to China to host “CHINA WEEK” event which will attract potential investors to South Korea and result in investments through one-on-one consultation meetings between SMEs and overseas investors. Also, a joint task force, designed to exchange potential investors list and to seek new investments demands through customized attraction activities, will be sent to the Middle East. Lastly, measures to enhance the overall investment environment for overseas investors will be established in May.   date2015-04-29

Korea and Chile agree to jointly develop technologies for copper mining

The Ministry of Trade, Industry and Energy (MOTIE) announced on April 23 that Korea and Chile agreed to jointly develop technologies that can be used for copper mining.     Representatives of the Korea Institute of Geoscience and Mineral Resources who are currently touring four South American countries with Korean President Park Geun-hye signed an MOU on joint development of application technologies for low grade copper ores with CODELCO on April 22 at the Sheraton Hotel Santiago, Chil date2015-04-23