South Korea Exports Fall For Seventh Straight Month

South Korea Exports Fall For Seventh Straight Month

May 2, 2023

South Korea’s exports declined for the seventh consecutive month in April due to the weak demand for semiconductors and a continuing fall in shipments to China, figures from the Ministry of Trade, Industry and Energy showed Monday.

Exports decreased 14.2 percent on a yearly basis in April, bigger than March’s 13.6 percent decrease. Shipments were forecast to drop 13.5 percent.

Likewise, imports declined at a faster pace of 13.3 percent annually after falling 6.4 percent in the previous month. This was also larger than economists’ forecast for 10.6 percent fall.

As a result, the trade balance posted a deficit for the 14th month in a row. Nonetheless, the shortfall decreased for the third straight month.

The trade deficit totaled $2.62 billion compared to $4.63 billion in March. In the same period last year, the shortfall was $2.37 billion.

Data showed that exports to China were 26.5 percent lower than in the previous year. At the same time, shipments to the US decreased 4.4 percent, while that to the EU advanced 9.9 percent in April.

By products, the annual fall in exports was driven by the 41.0 percent decline in semiconductor exports. Petroleum product exports decreased 27.3 percent. Similarly, exports of petrochemicals and steel fell 23.8 percent and 10.7 percent, respectively.

On the other hand, car exports jumped 40.3 percent and shipment of vessels surged 59.2 percent.

The ministry said the delay in global economic recovery and weak demand for semiconductors contributed to the fall in exports. Moreover, there were less working days and high base of comparison.

The Bank of Korea forecast the economy to grow less than 1.6 percent this year, affected by the deepened sluggishness in the IT industry. Exports weighed on the first quarter economic growth.

The central bank expects the economic growth to improve from the second half of the year, with the easing of the weakness in the IT industry and the impact of the Chinese economic recovery.

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