August Exports Down 9.9%, Daily Average Down 3.8%... Government Says "Relatively Strong" (Comprehensive)

Ministry of Industry Announces 'August Export-Import Trends'... Exports at $39.66 Billion
Single-Digit Decline for Two Consecutive Months Despite Shortage of Working Days
Increase in 4 Items... Semiconductors Turn Positive, Cars Down 12.8%
"Trade Ranking Rises from 9th to 8th"... Experts Warn "Caution Against Optimism"

[Asia Economy Reporters Kim Bo-kyung and Moon Chae-seok] Last month, South Korea's export value recorded $39.66 billion, a 9.9% decrease compared to the same month last year. The average daily export value fell by 3.8%, showing the smallest decline rate since the outbreak of the novel coronavirus disease (COVID-19). The government evaluated that "while major countries experienced sluggish exports, we performed relatively well."

According to the 'August Export-Import Trends' announced by the Ministry of Trade, Industry and Energy on the 1st, last month's export value was $39.66 billion, down 9.9% from August last year. Due to the global impact of COVID-19, exports have been in negative territory for six consecutive months.

Average Daily Export Value and Decline Rate Show Largest Improvement Since COVID-19

The Ministry of Trade, Industry and Energy emphasized the significance of recording a single-digit decline rate for two consecutive months, following July's (-7.1%), despite the number of working days last month being 1.5 days fewer than last year.

Considering the number of working days, the average daily export value was $1.8 billion. This is the largest scale since April, when the COVID-19 situation began to affect export performance. Monthly average daily export values show a gradual recovery: $1.65 billion in April, $1.62 billion in May, $1.67 billion in June, and $1.71 billion in July.

Compared to August last year, the average daily export value decreased by 3.8%, which is also the smallest decline since COVID-19. Except for January this year, when exports recorded positive growth, this is the best performance since 2019.

By major export items, four categories increased: semiconductors (2.8%), computers (106.6%), biohealth (58.8%), and home appliances (14.9%). Meanwhile, eleven items decreased, including automobiles (-12.8%), petrochemicals (-21.4%), steel (-19.7%), and displays (-22.8%). Semiconductor exports increased for two consecutive months, turning positive year-to-date from January to August compared to the same period last year.

Exports to South Korea's three major markets?the United States, China, and the European Union (EU)?all decreased by single-digit percentages. However, on an average daily basis, all three markets recorded positive growth for the first time in 1 year and 11 months. Exports to China decreased by 3.0% year-on-year, while exports to the U.S. and EU fell by 0.4% and 2.5%, respectively. Average daily exports increased by 3.6% to China, and by 6.4% and 4.1% to the U.S. and EU, respectively.

The Ministry cited the World Trade Organization (WTO) data on export and trade growth rates of the top 10 major countries in the first half of the year, stating, "While major countries showed sluggish export performance in the first half, our exports and trade performed relatively well," adding, "Our trade ranking rose from 9th to 8th, marking a one-step rise in eight years."

Seong Yoon-mo, Minister of Trade, Industry and Energy, said, "The August performance improved compared to July on an average daily basis, and exports to the three major markets?China, the U.S., and the EU, which account for half of our exports?all showed signs of recovery," adding, "This demonstrates that our exports are creating momentum for a rebound despite difficult conditions." He emphasized, "We will spare no effort to resolve export difficulties faced by companies and carefully check whether export revitalization measures are operating smoothly on the ground."

Sung Yun-mo, Minister of Trade, Industry and Energy Photo by Yonhap News

Experts: "Export Rebound? Not Yet"…Caution Against Optimism

Experts warn against 'export optimism.' Professor Jeong In-gyo of Inha University's Department of International Trade said, "Due to the great uncertainty caused by the spread of COVID-19, it is difficult to maintain an optimistic view," adding, "China's declaration of shifting to a domestic economy and the temporary increase in Korean imports during the supply chain adjustment process should not be interpreted as an export rebound due to China's economic recovery; such a view misses the bigger picture."

Professor Kang In-su of Sookmyung Women's University’s Department of Economics said, "For overseas demand to recover, COVID-19 prevention issues must be resolved, and it is not yet time to optimistically predict an export rebound," adding, "Traditional manufacturing industries such as automobiles, auto parts, and petrochemicals remain sluggish, while non-face-to-face information and communication technology (ICT) industries like semiconductors are enjoying a special demand. If this trend continues long-term, our exports may synchronize accordingly."

Meanwhile, the government is preparing a 'Non-Face-to-Face Export Activation Plan' to enhance the export capabilities of small and medium-sized enterprises and increase the number of non-face-to-face export companies by utilizing non-face-to-face technologies.

This content was produced with the assistance of AI translation services.