"Overseas Sales of Top 100 Companies Decline for 2 Consecutive Years Except in Electric and Electronics"

Federation of Korean Industries Analyzes Consolidated Performance Data from 2016 to 2020

Data provided by the Federation of Korean Industries

[Asia Economy Reporter Kim Heung-soon] The Federation of Korean Industries (FKI) announced on the 17th that an analysis of the consolidated performance data over the past five years (2016-2020) of the top 100 domestic companies by sales in 2019 revealed that these companies' overseas sales experienced negative growth for two consecutive years.

By quarter, overseas sales in the second quarter of last year decreased by 17.7% compared to the same period the previous year due to the global economic downturn caused by the COVID-19 pandemic. In the third quarter, as China recovered from the COVID-19 shock and the U.S. showed improvement centered on consumption and employment, overseas sales increased by 2.8% compared to the same period the previous year. In the fourth quarter, overseas sales decreased by 5.5% compared to the same period the previous year due to the impact of the third wave of the COVID-19 pandemic.

Most Major Industries Experienced Double-Digit Negative Growth in 2020

By industry, except for the electrical and electronics sector, most major industries such as automobiles and auto parts, energy and chemicals, general trading companies, steel and metals, shipbuilding and machinery, and construction and building materials saw overseas sales decline by double digits last year.

The electrical and electronics sector saw overseas sales increase by 4.0% year-on-year due to increased demand for mobile devices, PCs, semiconductors, and secondary electronics driven by the activation of the non-face-to-face economy amid the COVID-19 pandemic.

The automobile and auto parts sector experienced a 7.1% decrease in overseas sales due to production halts at North American and European automakers in the second quarter. The energy and chemical sector declined by 26.3% due to sluggish market conditions caused by low oil prices and weak refining margins, while the steel and metals sector fell by 12.1% due to a sharp drop in sales volume amid the downturn in demand industries.

Data provided by the Federation of Korean Industries

Overseas Sales to China and Asia Declined the Most

According to aggregated regional performance data of the top 20 companies reporting overseas sales by region and country, overseas sales in the China and Asia regions decreased by 13.8% year-on-year, marking the largest decline. The FKI explained, "This is attributed to the relatively large decrease of 6.3 percentage points in the real growth rates of China, India, Vietnam, and other key countries and regions that serve as major global production bases and the largest overseas business destinations for our leading companies from 2019 to 2020."

Overseas sales to the Americas increased by 5.0% year-on-year as the U.S. eased COVID-19 economic activity restrictions from the third quarter, with quarterly economic growth rates of 33.1% in the third quarter and 4.0% in the fourth quarter. Overseas sales to Europe decreased by only 0.6% year-on-year as economic lockdown measures were eased from the second half of the year and sales of semiconductors and batteries by European automobile OEMs improved.

Kim Bong-man, Director of International Cooperation at the FKI, stated, "To improve market access to Asian emerging countries where companies' overseas sales declined the most last year, our trade authorities should actively pursue trade strategies such as ratifying and implementing the Korea-Indonesia Comprehensive Economic Partnership Agreement (CEPA), ratifying the Regional Comprehensive Economic Partnership (RCEP), and creating conditions for joining the Trans-Pacific Partnership (TPP)."

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