Next-Generation Semiconductor and Electric Vehicle Exports Grow at an Annual Average of 7.2%... Better Than Europe and the United States

Last Year, South Korea's Top 5 New Industries Exported $59.3 Billion
Achieving Higher Growth Rates Than the US, China, Europe, and Japan

[Asia Economy Reporter Hwang Yoon-joo] Since the 2008 financial crisis, South Korea's export competitiveness in the five promising new industries has continuously improved, with exports in these sectors showing the fastest growth among major countries such as the United States, China, Germany, and Japan.

According to the "International Comparison of Export Competitiveness and National Economic Contribution Effects of the Five New Industries" report released on the 29th by the Korea International Trade Association's International Trade and Commerce Research Institute (Director Choi Yong-min), South Korea's exports in the five new industries?next-generation semiconductors, premium consumer goods, bio-health, electric and autonomous vehicles, and aviation and drones?increased from $25.4 billion in 2008 to $59.3 billion in 2019. This represents an average annual growth rate of 7.2% since the financial crisis, the highest among major countries.

Notably, despite South Korea's total exports decreasing by more than 10% compared to the previous year, exports in the five new industries increased by 2.4% last year, contributing to economic growth. This figure surpasses both the global average export growth rate of new industries (1.1%) and the average of major countries (1.3%).

The report compared the competitiveness of new growth industries using the trade specialization index, which measures quantitative comparative advantage in the global market for specific products, and the revealed comparative advantage index, which shows qualitative comparative advantage relative to other domestic products.

As a result, South Korea demonstrated the highest competitiveness among major countries particularly in the next-generation semiconductor and electric and autonomous vehicle sectors. In 2019, Korea's next-generation semiconductors ranked first in both the trade specialization index and revealed comparative advantage, and third in export market share. Electric and autonomous vehicles ranked second in the trade specialization index, first in revealed comparative advantage, and third in export market share. Additionally, bio-health, aviation and drones, and premium consumer goods also showed steady improvement in export competitiveness.

Exports of the five new growth industries also showed significant economic contributions, including economic growth and employment generation. While South Korea's total export contribution to economic growth was negative for two consecutive years at -14.4% in 2018 and -21.4% in 2019, exports from the five new industries showed positive contributions of 2.9% in 2018 and 17.0% in 2019. In 2019, these exports contributed 0.3 percentage points to South Korea's economic growth rate of 2.0%, with next-generation semiconductors contributing 0.18 percentage points, premium consumer goods 0.072 percentage points, and electric and autonomous vehicles 0.071 percentage points, in descending order of economic growth contribution.

From an employment perspective, in 2019, the number of jobs induced per $1 million of exports in new industries was 7.5, surpassing the total export average of 6.8.

Furthermore, the value added induced by exports in new industries last year totaled $41.8 billion, with next-generation semiconductors ($18.1 billion) and premium consumer goods ($16.4 billion) accounting for more than half of this amount. The export value-added ratio, which represents the proportion of value added directly and indirectly induced by exports to total exports, increased by 0.7 percentage points from 69.8% in 2017 to 70.5% in 2019 for new industries, whereas total exports saw a decline of 1.5 percentage points from 64.2% to 62.7% during the same period.

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