Export Volume Continues to Rise... What About the Impact of COVID-19 in April?

Improvement in Net Barter Terms of Trade Index... "Further Oil Price Decline Expected to Improve Outlook"

[Image source=Yonhap News]

[Asia Economy Reporter Jang Sehee] Despite the novel coronavirus infection (COVID-19), export volumes have steadily increased, indicating a continued improvement trend in semiconductor exports. However, due to the additional decline in oil prices, there is a forecast that the net barter terms of trade index will improve.

According to the "March 2020 Trade Index and Terms of Trade" released by the Bank of Korea on the 28th of last month, the export volume index last month was 122.78, an increase of 10.6% compared to the same month last year. Since February this year, it has been increasing by more than 10%.

In particular, export volumes increased mainly in electronics and optical devices (15.2%) and chemical products (11.2%).

Looking at the export value index, it rose 0.4% year-on-year to 111.45 in March. This marks a two-month consecutive upward trend. Export values also showed an upward trend centered on computers, electronics, and optical devices (1.8%).

Regarding imports, the volume index in March was 116.71, up 8.8% year-on-year. This maintained a two-month consecutive rising trend. Especially, it increased mainly in machinery and equipment (26.2%).

The import value index also recorded 117.27 in March, an increase of 1.5% compared to the same month last year. It rose mainly in machinery and equipment (26.1%).

However, there is also a forecast that terms of trade will improve if import prices fall further due to the decline in oil prices in April. A Bank of Korea official said, "Due to the impact of the oil price decline in April, import prices may fall more than export prices," adding, "Terms of trade could improve."

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