MONDAY, April 15, 2024

South Korean exports see decline accelerate in November

South Korean exports see decline accelerate in November

South Korea's exports fell for the second consecutive month on-year in November with the decline accelerating from the previous month due to the global economic slowdown and logistics disruptions over a truckers' strike, the Ministry of Trade, Industry and Energy said on Thursday.

The country also suffered a trade deficit for the eighth straight month due to high global energy prices.

Outbound shipments fell 14% on-year to US$51.91 billion last month, following a 5.7% on-year fall the previous month, according to the data compiled by the Ministry of Trade, Industry and Energy.

It is the first time since early 2020 that exports fell for the second month in a row.

The country's imports grew 2.7% on-year to $58.93 billion in November on high global energy prices, resulting in a trade deficit of $7.01 billion.

Imports have exceeded exports in South Korea since April, and it is the first time since 1997 that the country has suffered a trade deficit for the eighth straight month.

South Korea depends on imports for most of its energy needs, and the country's energy imports surged 27.1% on-year to $15.51 billion in November, the ministry said.

The fall in exports was blamed on the global economic slowdown amid high inflation and aggressive monetary tightening by major economies, as well as the impact of the ongoing truckers' strike that began November 24 over minimum freight rates, according to the ministry.

The nationwide walkout has caused supply disruptions in major industries, and it is feared to affect the broader economy by hurting overseas shipments, according to officials. The government ordered truckers to return to work, while their negotiations have made no progress.

A high base effect was also behind the exports fall last month, as exports spiked 31.9% on-year in November last year, the ministry said.

For the first 11 months of this year, however, exports grew 7.8 % to come to an all-time high of $629.1 billion, the ministry said.

By item, overseas sales of semiconductors, a key export item, tumbled 29.8% on-year to $8.45 billion in November on falling demand and the drop in chip prices, the data showed.

Chip exports have seen an on-year decline since August.

Sales of petrochemicals also fell 26.5% to $3.55 billion, and exports of steel products decreased 10.6% to $2.99 billion last month. Exports of ships sank 68.2% to $1.12 billion.

But car exports jumped 31% to $5.4 billion, an all-time monthly high, and sales of petroleum products advanced 26% to $4.88 billion.

Shipments of auto parts inched up 0.9% to $1.86 billion, and those of secondary batteries rose 0.5% to $740 million last month, the data showed.

By nation, exports to China, South Korea's top trading partner, fell 25.5% to $11.38 billion last month on the economic slowdown in China.

Shipments to the Association of Southeast Asian Nations also slid 13.9% to $9.08 billion.

South Korea's exports to the United States rose 8% to $8.79 billion, and those to the European Union added 0.1% to $5.3 billion, the data showed.

Exports bound for the Commonwealth of Independent States grew 4.6% to $1.29 billion in November due to low base effects, the ministry said.

"Given our high dependence on the global economic situation, it is necessary to revive export momentum to seek a breakthrough," Industry Minister Lee Chang-yang said.

"The government will thoroughly carry out tailor-made export promotion strategies, such as diversifying items and better supporting local exporters."

The Korea Herald

Asia News Network